The Guide

02. Watching F1, what is it?

formula1 :

The Pinnacle of Open-Wheel Racing

Watching F1, but what is it exactly?

Formula 1 is the pinnacle of open-wheel, single-seat car racing. Today the sport is a global phenomenon where hundreds of millions of people watch ten teams and 20 drivers compete for two world championships over a season. 

The competition for the Drivers World Title and the Constructors Title are run in parallel and will be held over 24 race weekends (2023), with six having added sprint races. 

Drivers and teams compete for points based on where they finish each race, with points awarded for places 1 – 10. And 1 – 8 in the sprint with a bonus point awarded for the fastest lap during the race, provided the recipient is in the top ten.

The Drivers Title is sought for individual prestige (although the driver will always credit a whole team effort), whereas where the teams rank in the Constructors Title also determines their share of the prize money

The owners

Liberty Media Group bought the rights to run the tournament and the associated media rights for $4.6b in 2017.

Since then, they have set about to actively widen and grow the audience base. They initiated the Netflix series Drive to Survive, which has significantly increased the sport’s popularity over recent years. Along with an increase to 24 events in 2024.

F1 can’t turn up and race anywhere, the tracks must be graded, and the host country bids for the rights from Liberty to hold the event. Most likely a much more lucrative endeavour in recent years due to the sport’s growth in popularity and sell-out crowds at every event in 2022.

Liberty manages the logistics, and races are clustered into regions as much as possible to assist with turning around the paddock in two weeks for the next event, and often one. The entire event is moved by the road where possible or where that is not possible; they use a fleet of jumbo jets and refer to the event as a fly-away

The sport has seen huge growth in the Americas, with three races scheduled for the USA in 2023 – Miami, Las Vegas and COTA in Austin. 

The FIA is the governing body for all Formula racing and is responsible for setting and enforcing the rules, as well as running the event. Their focus is on delivering entertaining and close racing with a focus on safety for all parties, which fuels Liberty’s ability to build their business and deliver more racing… 


F1 is a big-money sport. BIG MONEY. In 2021, Liberty Media introduced a cost cap to try and close the gap between the well-funded teams and those smaller teams nearer the back of the field. The cost cap is in the region of $145m, with a downward sliding scale but then adjusted back up for the number of races, added sprint races and inflation. To put the cost cap into perspective, Ferrari’s 2019 budget is estimated to have been $450m, so that’s quite a cut. 

Outside of this cost cap sits the supply of the Power Units (another $95m per team) and the salaries of the Drivers and top three executives. For the top three teams, that could feasibly equate to another $100m (Max and Lewis are rumoured to receive $50m.

Liberty Media shares profit from the season between its shareholders and the teams, 50/50. The team’s share is distributed under a prearranged matrix. Each team receives a $35,000,000 base fee and then a share based on the total points earned during the season. Finally, the top three teams receive a bonus, and a small number of teams receive legacy payments. Of note, Ferrari receives an extra 2.5% of the team’s fund. In 2018, Mercedes won the constrictors title and earned $177,000,000.00, while Ferrari came second and was paid out $205,000,000.00


Further income comes from teams selling sponsorship space on their cars, clothing and merchandise. With nearly 1 billion people tuning in to watch the 2021 final, you can well imagine the value of the advertising. While many factors affect how a deal is structured, various articles suggest sponsorship starts at around $100,000 and heads into the millions. A top-tier team could reasonably value their rear wing at over a million and side pod at 15 times that (this is indicative).

Drivers also come with title sponsors, and in some cases, drivers pay for the seat as opposed to being paid to drive the car. Known as a ‘paid seat’ and usually in one of the lower-ranking teams where there is an advantage in contracting a driver with funding behind them. 

And teams do pay an entry fee. This is based on a sliding scale reflecting their results from the previous year with a team at the back of the field paying around $500,000 and the winner paying closer to $5,000.000. 

Teams and drivers 

Ten teams, each with two cars and two drivers, enter the competition and accumulate points over the duration of the tournament. A driver’s points go towards his own tally, and the same amount of points is applied to the team. If a driver can’t compete, as we saw recently due to covid, the reserve driver will take over the duties and any points gained will be stated against his entry as well as the team. 

Teams are referred to as constructors or customers. Constructors design and build their own Power Units, such as Mercedes, Ferrari and Renault. In contrast, customer teams purchase their Power Units from one of the constructors. 

Ferrari has a rich history that goes back to the early days of Formula 1. McLaren joined in the ’60s when a bunch of guys built their own car on a shoestring and did whatever they could to get it to the start line. Today a new team will need to pay $100,000,000 to get a seat at the table before they even start to work on their entry.

The cars

Today’s F1 cars are mind-blowing machines designed to accelerate to 200kph in 4.5 seconds. They can reach speeds of around $350kph and corner at over 200kph. When the speed limiter comes on in the pits, they are ‘trundling along’ at 80kph.

F1 cars use downforce to stick to the road when cornering at high speed and you will see changes to the car depending on the track type. A track with long straights is referred to as low downforce and requires a smaller rear with less drag, whereas a track with more corners is high downforce and a larger rear wing. 

An F1 car produces more downforce than its own weight, so technically, it could drive upside down in a tunnel and not fall off the roof.

In 2022 a new set of regulations was enforced, changing the fundamental aerodynamics of the car and shifting it to a ground effect model. This is done to reduce the dirty air coming off of the lead car and allow closer racing from the car behind. This has proven to be very successful, with the 2022 season delivering wheel-to-wheel racing and action-packed passing.

Race Weekend. 

A race weekend takes place from Friday to Sunday. The weekend consists of three one-hour Free Practice sessions; two take place on Friday (FP1 and FP2), and one takes place Saturday morning (FP3).

An hour of qualifying split into three sessions takes place Saturday afternoon. That forms the starting grid for the race Sunday, with the format detailed below. 

The race is the main event of the weekend, and it’s where the points are delivered to the teams and drivers. The drivers race each other around the circuit for 190 miles (305 km), typically across two hours,  but race can take up to four hours depending on red flags (that is to say, the race needing to be suspended due to a crash).

The race features strategy elements, with pit stops and fuel management to consider. Incidents have a big impact, too; they lead to safety cars and virtual safety cars (meaning no overtakes and a limited speed).

The future of F1

F1 is always evolving, and Liberty Media appears to have a strong focus on delivering entertainment, inclusion and the environment. Rule changes are producing more exciting racing, a bolstered race calender, greater participation from feeder series, the introduction of Formula W and a female driver academy and a target of carbon zero by 2030. 

The next big change for F1 is the new 2026 Power Unit. 1000+ horsepower from biofuel (fossil fuel is banned), three times the battery power of today’s PU, increased safety and reduced costs (currently around $15m per unit). 

So that’s F1 in a nutshell. We will expand on the above in the following Guide posts, in addition to our general posts, FAQ’s and comprehensive F1-specific Glossary.



Andrew Burden

The author Kiwi F1 Fan

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