(Motorsport-Total.com) – The Chinese electric car giant BYD has set its sights on Formula 1 and could be aiming to enter the championship in the near future – in whatever form. Stella Li, BYD Vice President and CEO for America, Europe, and the Middle East, has never made a secret of seeing the world championship as the perfect stage to enhance the company’s brand image.
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Exactly how BYD could secure a starting place in Formula 1 remains a subject of ongoing discussions. Basically, there are three logical ways: First, a title sponsorship in the style of Gucci, which will appear in the name of the Alpine team from 2027, or even a complete takeover of a team’s brand identity, like Alfa Romeo did with Sauber a few years ago.
Second, there is the possibility of acquiring an existing team and ultimately founding a completely new twelfth team.
After initial exploratory talks earlier this year around the Chinese Grand Prix, Motorsport-Total.com has learned that Li will be on site next week at the Monaco Grand Prix and will meet with Formula 1 bosses ahead of the weekend.
However, it is assumed that things are still in a very early phase of information gathering and that concrete decisions about what BYD wants to do next are still far off.
What role does Horner play?
In recent weeks, the potential entry of the Chinese company has been linked to a possible Formula 1 return of Christian Horner.
He could theoretically return to the championship after his departure from Red Bull and is known to have exchanged views with a number of current and potential Formula 1 teams as well as investors about his next step.
Horner was photographed together with Li at the Cannes Film Festival, which appeared to be a carefully staged PR action – either to lend more credibility to BYD’s interest in a Formula 1 entry or to keep Horner’s name in the conversation and perhaps put pressure on other projects the former team principal is involved in.
Horner is also involved in a consortium that wants to acquire Otro Capital’s 24 percent stake in the Alpine team. His group is competing with Mercedes, and it is believed that other brands are also waiting in the wings to compete with players like BYD for a future Formula 1 entry.
Sponsorship yes, takeover uh …
In any case, the sponsorship option is easy to implement. However, if ultimate control is important, all roads lead to the takeover of an existing team or the founding of a twelfth team. These paths are likely to be steep uphill.
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Dubious Formula 1 sponsors
In recent months, several investment funds and a major car manufacturer have reportedly contacted teams with takeover offers of over two billion dollars, only to receive a polite “No, thank you” in response. No one is willing to sell – even at sums that would have far exceeded the value of a top team three or four years ago.
The consensus is that team valuations will continue to rise in the coming years. Therefore, no one wants to risk waking up with a billion-dollar hangover because they lost patience before the strategically perfect moment for a sale had arrived.
Twelfth team? It gets complicated …
The idea of founding a twelfth team is even more complicated than buying an existing team, as Formula 1 has only just approved the Cadillac project after a lengthy process.
Formula 1 has not yet been able to fully foresee the commercial or logistical impacts of adding an eleventh team at this time. Tight pit lanes at Grands Prix like Monaco or Montreal cannot magically create more space overnight.
And given the mentioned team valuations, it is also about agreeing on an anti-dilution fee, which will probably be even higher.
New Formula 1 teams since the 1990 season
BYD has the resources to easily handle this and to make agreements with an existing manufacturer for initial technical support. According to insiders in the Montreal paddock, however, the timing for a twelfth team does not yet seem ripe, even though Formula 1 currently has the legal framework to expand to up to twelve teams.
While the upcoming Monaco weekend could provide further clues about the direction of the journey, there is currently not enough evidence that BYD will ultimately put together a serious project – apart from cleverly spread speculation that has already brought a lot of attention to all involved.
Nevertheless, this underlines the idea that Formula 1 is a seller’s market and that it is encountering great interest in the huge Chinese market – which both Formula 1 boss Stefano Domenicali and FIA President Mohammed Ben Sulayem would like to tap even further.
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