FIA president Max Mosley has written to Formula One teams to further explain his vision for bringing down costs in Formula One, after revealing the FIA is in exclusive talks with Cosworth regarding a supply of engines from 2010.
On the same day that Honda announced it was withdrawing from the sport and putting its team up for sale, Mosley revealed that the proposed deal could see team's spending less than £6 million per year for an engine and transmission system.
That price would be dependent on four teams signing up for a supply of engines, with the costs set to be reduced if more teams elected to go down that route.
"We have completed the tendering process and are now in exclusive negotiations with Cosworth together with Xtrac and Ricardo Transmissions (XR) to supply a complete Formula One power train starting in 2010," Mosley wrote. "The engine will be a current Formula One engine while the transmission will be state-of-the-art Formula One and a joint effort by two companies which already supply transmissions to most of the grid.
"The cost to each team taking up this option will be an up-front payment of £1.68M (€1.97M) and then £5.49M (€6.42M) per season for each of the three years of the supply contract (2010, 2011, 2012). This price is based on four teams signing up and includes full technical support at all races and official tests, plus 30,000 km of testing.
"The annual cost will reduce if more teams take up the option, for example to £4.99M (€5.84M) per team with eight teams. It will further reduce if less than 30,000 km of testing is required. Neither engine nor transmission will be badged."
However, Mosley added that teams wouldn't be forced to use the spec-engine, which would be one of three possible options available.
As well as the Cosworth powerplant, teams would be able to build their own engine, identical to the Cosworth unit or 'continue to use their existing engine, with the current ban on development and requirement for engine parity still in place (noting that the engine supplied will become the reference engine for output and other performance indicators and no engine will be permitted to exceed those indicators)'. In all cases, teams would be required to use the XR transmission.
Alongside other cost-cutting measures the FIA is seeking to bring into place, Mosley said he was hopeful that the new engine regulations would allow independent teams to continue in the sport and would make it easier to replace any other manufacturers who elect to follow the lead of Honda and quit F1 – which Mosley wrote 'seems likely'.
Teams have until Thursday 11 December to say if they intend to enter contracts to use the standard engine, although the FIA could still push ahead with the plans if less than four teams sign up.
However, should that happen, the price on offer to teams would vary.