Eleven weeks until the start of the 2021 Formula 1 season (assuming Melbourne is, as expected, postponed) and still the world champion has not signed a contract with his team.
Sir Lewis Hamilton and Mercedes remain committed to each other in theory – but not yet on paper.
“We are not worried about eventually getting it done…” said Toto Wolff last month.
“We are not putting a special date to it because we don’t want to be under pressure. Sooner or later it needs to be done and, at the latest, before we go testing.”
The December announcement of the revised shareholding in the team is probably where we should be looking for the real explanation of the delay in F1’s best driver and best team tying the knot to extend their eight-year partnership.
The automotive parent company Daimler Benz has reduced its shareholding in the team from 60% to 33%. Energy company and former sponsor Ineos has become a 33% shareholder – with team boss Wolff the other one-third partner (previously he owned 30%).
It’s against this corporate background that Hamilton has been negotiating his contract.
He won’t be cheap – and the grapevine suggests he’s pushing for a £35million annual retainer plus a share in prize money and possibly a future role in the team in addition to/after that of driving.
It would be a tough negotiation even in normal times, but against the redrawn commercial landscape of COVID and a major ownership restructure of the Mercedes team, it’s sure to be even trickier.
Daimler has been forced to make extensive redundancies due to the pandemic and structural changes in the industry as it moves inexorably towards electrification.
So the granting of such a high-profile, high-paying contract to Hamilton is difficult in its timing.
But on the other hand, the company’s significantly reduced share in the team means it could still be making an overall saving on its F1 budget, especially now with the cost cap applied. It’s probably more a question of tone than money.
Similarly, it’s unknown where new co-owner Ineos boss Jim Ratcliffe stands in the negotiation and whether or not he will simply be guided by Wolff’s management of the situation.
What we do know is that both the team and Hamilton definitely want to extend the partnership. We’d judge the likelihood of him not continuing to be remote.
We believe the situation will be resolved significantly before testing begins. But this is F1…
