MPH: Why has Honda only extended its F1 contract by a year?

by Mark Hughes on 29th November 2019

A new F1 deal will keep Honda in the sport until 2021 with Red Bull and Toro Rosso, but plans beyond that remain unknown…

Alexander Albon in the Red Bull RB15 during the 2019 Brazilian Grand Prix

Honda signed a one-year extension to stay in F1 but the move leaves its long-term future up in the air Photo: Motorsport Images

Just as with Mercedesdriver announcements earlier in the season, there are several ways that Honda’s announcement that it has extended its supply contract to Red Bull and Toro Rosso for an extra year might be taken.

The statement that it will continue this supply into 2021, thereby extending the current contract by a year, rather poses the question of ‘why only one year?’ What happens beyond that? It’s no secret that the Honda board has been split on whether to continue its F1 programme into the ‘new’ F1 that is post-2020. These were highlighted earlier this year in the magazine.

To quote from that piece, “Honda’s automotive COO Seiji Kuraishi is a man said not to be in favour of the programme. In a presentation last year, he said, ‘One of our goals is to make Honda a company that society wants to exist. In order to achieve this objective in the fast-changing environment, we have formulated the 2030 vision to provide new value unique to Honda. One of the keys to achieving this objective is in reducing CO2 output.’ A petrol-burning formula, hybrid or not, might not resonate much with an automotive company looking to move to electrical, hydrogen and fuel cell technology.”

There is also a very real concern about the costs of an F1 programme in a time the automotive industry is having to invest massively in new technology (drive-by-wire, electric, fuel cells etc).

A board meeting took place after Brazil – and this one-year extension is the outcome. But what does it signify? Here are the possible scenarios.

Pierre Gasly's Toro Rosso Honda out-drags Lewis Hamilton's Mercedes for second during the 2019 Brazilian Grand Prix

The Honda-powered Toro Rosso beats the works Mercedes to the line Photo: Motorsport Images

Face Value

It may mean exactly what it says, and no more: that it will definitely continue until the end of 2021 at least and at some stage before then, once negotiations have been completed and terms agreed with both F1 and the Red Bull group, there will be a longer term commitment.

Future Success

With a super-strong end of 2019, there is a tantalising prospect of proper, title-contending form in 2020 with Red Bull. In which case it might be awkward to pull out just as real success has finally been achieved after such a long and difficult gestation.

A one year extension might allow the board to gauge whether the motorsport programme has actually achieved true competitive parity with Mercedes, Ferrari etc - or even superiority. In which case, committing to a longer programme may then become more feasible.

Max Verstappen and Toyoharu Tanabe celebrates his win at the 2019 Austrian Grand Prix

Could Honda be pulling out just as real progress appears to be bearing results Photo: Motorsport Images

Leverage

If Red Bull and Honda together can play the ‘possible loss of a manufacturer’ card in order to get whatever commercial and/or technical changes they might be seeking, a one year extension would serve that agenda pretty well, even if in reality the intention is to continue for the full term of the new agreement (which runs until the end of 2025).

Pull-Out

Has the board decided it will definitely be pulling out – and the one-year extension is just as a favour to Red Bull to give it time to arrange an alternative?

Take your pick.

 

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