COOPER: Handy Timing

Formula 1

COOPER: Handy Timing

It’s taken a full 55 years, but in 2010 Mercedes-Benz will finally be back under its own name...

Adam Cooper | http://www.speedtv.com | Posted November 16, 2009 Balen (BEL)

Mercedes-Benz will be running under its own name and with pure ‘Silver Arrows’ livery in 2010 for the first time since 1955. (Photo: LAT Photographic)

It’s taken a full 55 years, but in 2010 Mercedes-Benz will finally be back under its own name and running with a pure ‘Silver Arrows’ livery for the first time since it withdrew from the sport at the end of 1955.

After a false start with its former World Sportscar Championship partner Sauber, followed by 14 sometimes successful but often rocky years of marriage with McLaren, the purchase of 75.1% of Brawn GP will allow the company to run its own show.

Ross Brawn and his existing management team are overseeing day to day operations, but it will be Mercedes Grand Prix, have no doubt. The fact that the operation was still owned by Honda some 49 or so weeks ago will conveniently be overlooked...

The reasons for the divorce with McLaren are complex, but Mercedes concedes that McLaren Automotive’s road car ambitions are the major concern. It’s obvious that the recent spying and lying scandals also did not sit well with Stuttgart.

But the bottom line is that Mercedes was never fully in control of its own destiny when in partnership with McLaren. Even after acquiring a 40% share, Mercedes was something of a sleeping partner, and (outside the German media at least) it was always viewed as just a supplier to McLaren. Now it can claim all the glory, but equally, it has nowhere to hide should things go wrong.

The purchase may prove to be a relative bargain. The existing McLaren Group shareholders have agreed to reclaim Daimler’s 40% holding over the next two years, one assumes at the perceived market value, or something close. It will probably prove to have been a good investment. In fact Daimler is only buying 45.1% of Brawn GP with its own funds, and it is likely to be spending a lot less than it will receive.

The remaining 30% will be paid for by Aabar Investments, an Abu Dhabi government-backed group that already owns a 9% chunk of Daimler. Another Abu Dhabi concern owns a share of Ferrari (hence the Etihad Airlines sponsorship on the Maranello cars), so that is something of a strange anomaly.

As is the fact that Aabar already owns a big part of Virgin Galactic. Bear in mind that Virgin tried and failed to buy into Brawn earlier this year, and has now jumped into bed with the new Manor team – whose new boss is also the head of Virgin Galactic.

Meanwhile as part of the settlement McLaren will continue to use Mercedes engines until 2015. That continuity seems to represent a pretty good bet by the German company – it would be far more painful if McLaren switched supplier and found success, at the expense of the new teams. To paraphrase what was once said of J Edgar Hoover, better to have them on the inside pissing out...

It remains to be seen how cordial the relationship will become over time, but one imagines that things might grow a little tense. It’s also not entirely clear whether the team has the option to make an alternative choice. A new engine formula is due in 2013 in any case.

Intriguingly as an aside to all this, McLaren Automotive will be ‘spun out’ of the rest of the company, which will allow the race team and road car business to have different shareholder groupings as the Mercedes stock is reassigned.

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Adam Cooper

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