A significant development has emerged in the ongoing saga surrounding Andretti Global's bid to enter Formula 1. Twelve...
The post US Congress raises concerns over F1’s rejection of Andretti bid appeared first on F1i.com.
A significant development has emerged in the ongoing saga surrounding Andretti Global's bid to enter Formula 1.
Twelve members of the US Congress have sent a letter to Liberty Media, F1's commercial rights holder, expressing strong concerns about the rejection of the American team's application.
In January 2023, Andretti Global, partnered with automotive giant General Motors, submitted an official bid to join the F1 grid as early as the 2024 season.
While the FIA, F1's regulatory body, approved their technical capabilities last October, their application was ultimately rejected by Formula One Management (FOM) earlier this year.
FOM cited the lack of value for Formula 1 that an eleventh team would bring to the sport and its skepticism towards Andretti’s ability to be “a competitive participant”.
It also feared that accepting an additional team would risk placing a financial burden on F1’s race promoters.
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F1 legend Mario Andretti, a vocal advocate for the American family’s bid, visited Capitol Hill this week and met with Congressman John James, one of the twelve bipartisan signatories to the letter.
The US Congress members, in their letter addressed to Liberty Media CEO Greg Maffei, raise critical questions about the true motives behind Andretti’s rejection, hinting at potential anti-competitive practices.
"We write to express our concerns with apparent anti-competitive actions that could prevent two American companies, Andretti Global and General Motors (GM), from producing and competing in Formula 1."
We are grateful to the bipartisan members of Congress for their support in challenging this anti-competitive behavior.
We remain committed to bringing the first US works team and power unit to F1 and to giving American fans a home team to root for.
It is our hope that this… pic.twitter.com/CyqqDhDzoa
— Andretti Global (@AndrettiGlobal) May 1, 2024
The letter further emphasizes the potential violation of US antitrust laws, stating that the rejection “appears to be driven by the current line-up of European Formula 1 race teams, many of which are affiliated with foreign automobile manufacturers that directly compete with American automotive companies like GM. It is unfair and wrong to attempt to block American companies from joining Formula 1, which could also violate American antitrust laws.”
The letter also underscores the principle of a meritocratic entry into Formula 1.
“Participation of all Formula 1 teams including any American teams should be based on merit and not just limited to protecting the current line-up of race teams.
"This is especially true considering Formula 1's growing presence in the United States, including three Grand Prix motoring [sic] racing events in Miami, Florida; Austin, Texas; and Las Vegas, Nevada.”
©Andretti
The 12 members of Congress have asked for Liberty's responses to the following questions by May 3rd.
1. “Under what authority does FOM proceed to reject admission of Andretti Global? What is the rationale for FOM's rejection, especially with respect to Andretti Global and its partner GM, potentially being the first American-owned and America-built race team
2. “The Sherman Antitrust Act of 1890 outlaws unreasonable restraints on market competition to produce the best outcome for the American consumer. How does FOM's denial of Andretti Global and GM, American-owned companies, square with Sherman Act requirements, since the decision will benefit incumbent European racing teams and their foreign automobile manufacturing affiliates?
3. “We understand that GM intends to re-introduce its Cadillac brand into the European market, which would support thousands of good-paying American automotive jobs, especially with Formula 1's worldwide audience and its halo effect on its teams and sponsors. How much did GM's and Andretti's entrance into racing competition taking a portion of the racing market share and GM's entry into the European market taking market share each play into the decision to deny admission to the Andretti Global team, given the public outcry of incumbent Formula 1 teams against a new American competitor?”
“We continue to exercise oversight on this matter, and with the appropriate Federal regulators, to ensure that any potential violations of U.S. anticompetition law are expeditiously investigated and pursued,” concludes the letter.
The intervention by US Congress members clearly signifies a significant escalation in the Andretti-GM saga.
It demands transparency from FOM regarding their decision-making process and potentially paves the way for legal action if anti-competitive practices are confirmed.
The future of Andretti Global's F1 ambitions remains uncertain, but the involvement of Congress injects a new layer of complexity and potential legal ramifications into the situation.
©MarkAntarDesign
“I’ll let you figure out if this is cartel-type behaviour; if this is anti-competition, monopolistic-type behaviour,” Republican Congressman for Michigan John James told NBC News.
“From the outside looking in, one can ask: Is this a money grab?.
“One can ask: Is Formula 1, is Liberty Media kicking the can down the road to get a more juicy deal for themselves, so that they can go from $200 million to $1 billion dollars extracted from Andretti-Cadillac.
“Meanwhile, the commitment has been shown by Andretti-Cadillac, I think, to the tune of millions of dollars a month in preparing for the standards of complying with everything.
“We hope that we can resolve this to do business together for our mutual benefit, but particularly for America. But if not, we will have our questions answered.
“Because we have an obligation to protect the American consumer, to protect American companies, and that is our first allegiance. And those who are seeking to take advantage will be held accountable.
“It’s not just supporting Andretti. It’s about supporting Americans.”
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