Williams' future in Formula 1 was quite possibly saved by the drastic cost-cutting measures being brought into force in the top flight over the next few years, the Grove-based concern's owner and chief executive have confessed.
Williams has claimed no fewer than nine drivers' crowns and seven constructors' titles since its entry in to the sport just over three decades ago, making it statistically one of the most successful teams in F1 history. Of late, however, not only have results dried up – with no victory now since the 2004 Brazilian Grand Prix finale at Interlagos – but so have funds, with reputed losses of £27.7 million in 2006 and £21.4 million in 2007.
The Financial Times
reports that the cost to the independent outfit of Formula 1 competition was £100 million in 2008 alone – a significant three-fold increase in ten years. Worse still, having parted company with BMW at the end of the 2005 campaign – leaving it without the support of a major manufacturer behind it, a distinct rarity in modern F1 – Williams has been relying predominantly on sponsorship for two-thirds of its income.
However, embattled Icelandic investor Baugur, Brazilian oil company Petrobas and Chinese IT firm Lenovo have all recently jumped ship, and major backer the Royal Bank of Scotland has announced that its own support is also under review in the wake of a disastrous 70 per cent loss in its share price resulting from the global credit crunch – the greatest corporate loss in British history.
“We recognise the need to ensure that our sponsorship activity reflects the process of restructuring that the bank has underway,” a spokesman told the Daily Telegraph
Nonetheless, there are still two years remaining on RBS' three-year contract with Williams, and team CEO Adam Parr assured that more than 60 per cent of its sponsorship target is secured for 2009.
“I think it would be fair to say we have reached a point where further borrowing is not acceptable to the board of this company,” he told the FT
“[Given] the financial pressure we are under, the consequent changes to the rules to reduce the cost of racing are a major benefit,” added team founder Sir Frank Williams, evincing a 'fresh start' this year. “We need to make a profit.
“To be successful and to be certain of staying in business, we need to be successful financially too. We need to make a profit every year. We've lost in the last two years, or three, I think, but we have the reserves and resource to manage that.”