Monisha Kaltenborn has had a rough first full year as team principal of the Sauber Formula One squad. The former lawyer, born in Dehradun, has had to keep team morale up in the face of a lack of results on track, while at the same time having to work tirelessly behind the scenes to find vital funding to secure the outfit’s financial future.
Abhishek Takle spoke to Monisha in Korea about the Indian Grand Prix, the high cost of competing in Formula One, the deal the team agreed with a group of Russian investors and next year’s driver line-up.
Abhishek Takle: First, I want to get this question out of the way, a question of common interest to the both of us – India. What are the issues there? I’ve spoken to you about this before as well but what seem to be the main problems and around why the future of the Grand Prix is in question?
Monisha Kaltenborn: Generally, it’s the responsibility of the commercial rights holder to determine the calendar and to choose the races and when they come so we have not really been informed that much about the reasons. We understand that there are some differences between the promoter and the commercial rights holder so we were told that for that reason the race is not going to be on the calendar.
AT: But there are well reported issues around the taxes for example. Drivers have to pay a withholding tax on their salaries, do teams also have to pay an entertainment tax when they go and race there?
MK: The teams are also subject to taxation, yes.
AT: Apart from the customs duties?
MK: Yes. And we did have a difficult time getting in there and I don’t think that’s the major reason but definitely also a factor that we don’t understand why it is made so difficult for the sport because the platform is excellent, we know that there is a fan base there, for companies it’s important so — we’re not saying we should have privileges — but why should it be made so difficult?
AT: So you’re not asking for anything from the authorities but they could make the sport feel more welcome?
MK: Yes. And it is a sport. To start with it is a sport. And just because maybe we have glamorous guests or we get the kind of attention it should not deviate from the fact that it is foremost a sport.
AT: As you mentioned just now it’s an important market and in fact in the run up to the first Grand Prix also there was a lot of talk about how it’s an important market – rising incomes, an emerging middle class. But are we at a point where the difficulties the authorities throw up – the trade-off between it being an important market and sponsors tapping that demographic, the trade-off is less favourable because of the difficulties that the authorities throw up?
MK: I don’t think that it’s actually just about the authorities. It is certainly one aspect that, of course, has an influence on how the sport is perceived. And if, from the beginning, it is perceived as something where there are issues, and the taxation coming in because it is something luxurious, this does not help establishing it and this also makes companies cautious of using the platform because you might transmit the wrong message over there. So that’s not been beneficial for establishing it. And then of course if you don’t feel welcome as a sport, I can very well imagine that the commercial rights holder will say when there are other races which want to come in then we’d rather go for them.
AT: Moving on from the India topic – Sauber has been in the news a lot this season, unfortunately not for all the right reasons. There were financial difficulties reported earlier on in the year. How distracting has it been? Because there was speculation that you might not reach the end of the season …
MK: It’s not been helpful at all. And I think it shows two sides which are not good about Formula One. One is that, generally, if you just talk about finances and the situation teams are in, it shows that the situation is not healthy and something should be done because it’s not only Sauber – it might have this year been more (about) Sauber – now other teams are coming into the focus and that’s not what the reporting should focus on. Because we are about a competition, we are about athletes, it’s eleven teams fighting against each other and actually that should be the focus of reporting and not these financial issues. There were times when one was just talking about the finances and nothing else, which is bad for the product because the product is a very, very good product and it is together with the Olympic Games – as we especially saw now when we were in Russia (Sauber recently conducted a demo run in the Russian town of Sochi which will host the winter Olympics next year as well as Russia’s inaugural race) – and the football world cup, one of the three strongest sport platforms. So that’s what we should avoid. As for us, it’s also not been good for us. On the other hand, we have been through many ups and downs. The company was founded in 1970 and we are still there. We are today the fourth oldest brand after very big names like Ferrari, McLaren and Williams and we still plan to be there. And we have I think shown how we can go through difficult times. So it did hurt a bit to see that people took such a negative position in spite of our track record but I guess it’s more sensational to write that but then the next sensation comes up and then one is suddenly in the back row.
AT: Unfortunately, after Sauber the next sensation was also financial with Lotus, for example. But what does that say about the state of Formula One where you have the fourth oldest team which faced financial difficulties, you have a title contender which is in financial difficulties. This might be a bit of a naïve question but why can’t teams sit down and agree on bringing the costs down because everyone you talk to says it’s a concern?
MK: I think it’s a very valid question because what it shows for me is that the overall environment is not right and what is wrong is to project this onto the product. Because for me, it is still one of the best platforms which combines sport, marketing, technology and it is ideal for companies — because it’s worldwide — to actually exploit this. No other sport can offer you that so regularly throughout the year and that too year by year and at a global level. The other two sports or events which I mentioned are either four years or they’re very limited to one place whereas we are really, truly global and yet local at these places. So there’s nothing wrong with this product. But what is not right is that if we reach financial levels where, actually, more than half of the grid cannot stay and this sport should not be about money. We know, and that’s always been the case, that there have been richer teams and poorer teams but it was in some way leveled. If I look back even to the time when we were fourth in the constructors’ championship long before all the manufacturers came in again, you still had the possibility as a small, private team to make that step off and on into the top four, top five and just cause the excitement and that’s getting more and more difficult. So what we really need to look at is that we are embedded in this overall global economic situation, it’s not good anywhere, so we need to react and it is not so difficult to react for us. We’ve done that before. We’ve laid the steps with the RRA, the Resource Restriction Agreement, and that’s the way we need to go ahead.
AT: You mention the RRA, you say it’s not difficult to react. But when Max Mosley had proposed a 40 million pound budget cap it caused political ructions within the sport. The RRA came in, but the teams have shown that they’re not able to agree, or even implement the RRA. It’s toothless right, because if you choose not to adhere to it, there won’t be any penalty. So do you think it needs a third party to police costs because teams clearly can’t seem to agree?
MK: Absolutely. And I think this is very normal because nowhere where many people come together they can manage it on their own. You always need an authority on top. So for me it is the job of our Federation. Like they check the technical side, like they check the sporting side, they need to look at the financial side. Because we see the dangers and it cannot be that only the people who have the money should be the ones in the sport. Because even the image we have, and the standing we have lives from diversity. So I’m convinced of it that you will not be able to have this kind of prominence and the image that we represent with just four teams. So you need the smaller ones, even if they are not that important maybe for the competition itself, but you need it for the overall picture. Because fans like it. And at the end of the day, it’s all about the fans, even for the companies, because the companies reach out to their clients which are fans. So we have to always keep our prime target, the fans, in mind. And they like this diversity. So as such it’s not difficult, that’s what I meant to say. It’s easy to implement something but you need an authority to do it. We’ve set out a lot of principles which we gave the FIA and I hope that now once the election is over, that the FIA will play an active role in this.
AT: You agreed your Russian investment deal over the summer. Has the money from that started coming in?
MK: We confirmed, we clarified that, yes, money has come. Things take their time, we cannot push it more, so we are working on it.
AT: Part of the deal is preparing Sergey Sirotkin to step up to a race seat. So in case he is not ready, is there a clause that restricts a part of the funding which, when he is ready and once you put him in the car, triggers the release of those funds?
MK: First of all, the contract is subject to confidentiality so I cannot comment on that at all. But clearly what matters to all sides is that whatever step you take is a sensible one, that you don’t just push through things. So we will together look at how he will develop now, how he will do the testing and then we will make our assessment.
AT: So the financial side of the deal is independent of whether Sergey races next year or not?
AT: What has his progress been like? You did the demo run with him in Sochi last weekend and now you’ve got tests lined up for him at the end of October. So are you impressed by what he’s done so far, working with the engineers in the factory and that sort of thing?
MK: It’s too early to say something. Clearly what we can see is a very positive feedback from the engineers. When they spoke to him, he brings the right attitude along, he listens a lot, he learns very quickly. But all this can say nothing about how he will be on the track. The first test is on Monday (Oct. 7th) and then we will start seeing how he is on the track and how he can adapt.
AT: What car will he be driving?
MK: He will be driving an old Ferrari. (Note: Sirotkin will drive a 2009 Ferrari at Fiorano in Italy)
AT: Which brings me basically to the drivers, because Rubens has popped up as a name this weekend in fact when you didn’t deny the fact that he could be a candidate. There are obviously many drivers in the running for the seat. Can you reveal who they are, who you’re considering, any names?
MK: No. I do not want to nourish any speculation! And also with Rubens, I don’t know where this story came from and why it developed into the extent it has. We have clarified over the weekend so far that we have never spoken to him regarding a seat for next year, also not regarding racing in Brazil. I have a lot of respect for him for what he has achieved and I can fully understand that he wants to race again but we’ve not had these talks with him.
AT: But there are some suggestions that you might go into next year with an inexperienced driver line up and Rubens could probably come on board as a driver mentor, similar to what Alex Wurz is doing at Williams. Is that a possibility?
MK: No. We have spoken about young drivers and how he sees things but we have not spoken about any co-operation at all.
AT: Are you comfortable heading into next season, if you have to, with Esteban and Sergey? It’s a season of big changes so are you comfortable heading into the year with such an inexperienced line up?
MK: For me, that is not a question which is relevant because whatever situation we are in, we will decide on our drivers then and then you just make the most of it. So we have seen, we’ve had years even before in the team’s history where we had very young drivers, inexperienced drivers, one was a rookie, one a half-rookie and I think it was one of our best seasons. So we’ve had other situations as well where we had a very experienced driver and a rookie and they were not so good. So we as a team have had a lot of experience and we will do the best with whatever driver line up we have.
AT: Are you still trying to hold onto Nico, though?
MK: I will not comment on that.
AT: Can you convince him to stay on after this season?
MK: Every driver has to decide that for himself and he can see what kind of a car we have. I think we are among the few teams which is showing how we are still going up through better understanding of the car which is very important also for your future development. So it’s for him to make his opinion of it.
AT: Moving on to a lighter subject now – since Monza you’ve had an upturn in form. In Monza you said it was a surprise but have you figured out why you’ve had that upturn in form and are you expecting that to continue through to the end of the season?
MK: I don’t think Monza was a surprise in the sense that we thought we were going to be really bad there and suddenly we were good. We can see since the Hungarian Grand Prix or even, for that matter the Nurburgring, that there is the upwards trend coming in now. It didn’t always reflect in results for various reasons but we knew that we’re slowly getting to where we want to be. Then with the points coming in slowly we also saw it as being confirmed by the results on track and then we had of course Monza, then we had Singapore where Esteban qualified so well. So I think it’s more than a trend now. It is really the direction we are going. I’m sure we will have a setback or so but the direction is clear because it’s based on a solid understanding we have of the car. So I hope it continues that way.
AT: You identified early on in the season that it was the rear-end aerodynamics but it was still an evolution of last year’s concept wasn’t it?
MK: Not really.
AT: So you tried a new concept and it didn’t quite work out?
MK: Yes, but you also have to know how far a concept you have can be developed further. And when we knew there’s nothing much we can do there, we went a different way. Maybe we went here and there a little wrong or didn’t understand the things correctly, but I think this shows that since we have not fundamentally changed the car, that it wasn’t all that wrong as it might have looked. So now we understand the problems better and we can remedy them better.
AT: And what does that do for team morale, since Monza?
MK: Well you see smiling faces, which is good. It’s very important because when you struggle this much… It’s at the end of the day in the team about success, sporting success. And that’s what we all strive for. So if you can repeat these kind of results, the positive morale, the positive thinking establishes itself again. And then you can also handle situations which are not that good, maybe, better. And that’s important, that the people believe in themselves. And we are lucky to have a very strong core team which we can always rely on and that has always been our strength.
AT: Couple of questions on next year, starting with the calendar – 22 races. Is that doable or is it a bit too much given you’ve also got the in-season testing?
MK: I would like to first wait and see what the actual calendar is, the final one. Personally, I think 20 races are more than enough because we shouldn’t be saturating the market with races. And then the other side are the logistical issues which maybe you can still manage but it is mainly for me the manpower behind it because you cannot expect people to do the races and the testing – although it is going to be at the track where the race takes place – you still need different people. You can’t make the people do all that work. So that doesn’t avoid the problem you have with getting extra people in. And then you can’t forget that teams also need to do some PR, like we did the demo run in Sochi, and this adds on to it. So how can you manage just with the current crew and the structures we have? So this actually will result in higher costs.
AT: So are you expecting the calendar to be trimmed? Because you have that triple-header which not too many people are saying is feasible with New Jersey. Martin Whitmarsh says that there’s not much going on in New Jersey so you expect probably that to fall off?
MK: I think some races will still drop out, yes, and that could be one of them.
AT: And new regulations next year. Are you excited about it or are you concerned about the conservation formula we seem to be heading towards?
MK: It’s going to be a challenge. We already went back on the aerodynamic side a lot considering what was originally planned to be in there. But it will be a big challenge with the new powertrain coming in. And of course as a customer team on the engine side we have certain disadvantages compared to the manufacturer teams so I do expect that they probably will have a certain advantage at the beginning but then we should be able to catch up later on.
AT: Like you say, you’re a customer team. You just announced a deal for next year with Ferrari, in fact. So all this time that you’ve been designing the car for next year have you been designing it under the assumption that you would be putting a Ferrari engine into it?
MK: Yes, and we also did get information (from Ferrari). This was more about certain technicalities which we sorted out and we have a long-lasting relationship with each other, so it was not that tricky an issue.
Images courtesy of Octane Photographic.