Commentary

McLaren pays $100 million; the F-1 world keeps spinning

Updated: September 14, 2007, 2:27 PM ET
By Mark Kreidler | Special to ESPN.com

Bill Belichick and the NFL? Financial pikers.

The real money is in Formula One, and if you need proof, simply consider Ron Dennis' reaction upon being informed that his McLaren racing team had been fined $100 million -- I said $100 million -- for cheating on rival Ferrari in the "spying operation" that has shaken the sport.

Lewis Hamilton
AP Photo/Darron Cummings Lewis Hamilton and McLaren lead in the F-1 points race by a nose.
"We have a turnover of $450 million to $500 million a year and we are debt-free," Dennis said, not blithely so much as matter-of-factly. "This is a very strong company."

A debt-free race company, operating in the half-billion dollar turnover range, facing a $100 million fine. Let's put that in some American perspective. The New York Yankees spent around $200 million in baseball payroll last season and got hit with a fine -- excuse me, a "luxury tax" -- of roughly $26 million. The tax, although not nothing, was certainly not a disincentive to the Yankees to spend that $200 mil in the first place, nor to spend it again this season.

For McLaren, likewise, this ludicrous record fine -- nothing remotely close to it has occurred in the 57-year history of F1, nor for that matter in the history of any other sport -- is not nothing. (Of course, if they'll just stop by Bud Selig's office during the next team road trip that passes through New York, they'll be able to lower it by at least half upon appeal.) But in a sport that reportedly generates more than $4 billion a year in revenue, even this unprecedented penalty is not exactly the end of nature.

McLaren will certainly go on, bloody nose and all. You can bet the house that F1 will continue. Ferrari comes out just fine. And the sport, the industry itself, keeps rolling. If anything, the McLaren-Ferrari contretemps just clued in the generally unobservant U.S. sports market for one of the first times all season, and considering the deep pockets here for sports-related interests, that's almost never a bad thing. We may not know racing, but we understand cheating scandals, and we've seldom let one come between us and a good weekend event on TV.

It's yet unclear how much of the $100 million will actually be paid (or to whom), but on any level the fine represents a new benchmark in … well, we're not sure exactly what. Among the F1 cognoscente, there is a strong body of thought that the cartoonish amount of the penalty reflects a longtime grudge held against McLaren team principal Dennis by Max Mosley, president of Fédération Internationale de l'Automobile, the governing body for the sport.

Jackie Stewart, the former world champion, went so far earlier this week as to describe what FIA was doing to McLaren and Dennis as "witch-hunting." David Tremayne, writing in the Belfast Telegraph, mentioned "the ongoing class war" between McLaren team principal Ron Dennis and FIA president Max Mosley, adding, "Dennis was told in Monza last weekend that if he were to retire from the sport, all the team's problems would go away."

If so, that might explain how FIA could come up with a $100 million figure, though roughly half that is thought to be in the form of lost winnings. And as for the fact that the governing body declined to sanction McLaren's top two drivers, even though it stripped the team of the ability to win the constructors' title for overall points? Well, that's just good old-fashioned business.

In one of those stunning coincidences, Lewis Hamilton, a rookie, and Fernando Alonso, a two-time champ, are running 1-2 in the drivers' points race. Their absence from this stretch run of the season -- they're separated by only three points, with four races to go -- would take the starch out of a great individual competition in which the Ferrari drivers are third and fourth, respectively. Thus, FIA magically concluded that since Hamilton and Alonso had been really cooperative during the investigation (or some such), they could carry on.

On Friday, FIA directly implicated Alonso, quoting e-mail exchanges it said proved that Alonso and test driver Pedro de la Rosa were in unauthorized possession of secret technical information belonging to Ferrari. Still, de la Rosa will drive in the final four races.

Remember, this is a $4 billion annual venture. As a colleague noted, in some of the places where F1 races, $100 million barely buys you one of the yachts that are moored near the race sites. There are still races to be run and money to be made.

And made it shall be. Long after the McLaren team has figured out how to make the fine come off the books, long after the corporate sponsors have done their dance of disgust and then come right back to the endorsement table, the true wonder of all this will be that there's a sport in the world in which a team can get fined $100 million -- and go right on humming. By any measure, impressive.

Mark Kreidler's book "Four Days to Glory: Wrestling With the Soul of the American Heartland", published by HarperCollins, is in its third printing. His book "The Kids of Summer," about the curious ability of one town to consistently produce Little League champions, will be released in July 2008. A regular contributor to ESPN.com, he can be reached at mark@markkreidler.com.

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