The pandemic effects McLaren. Will Renault announce next?
On Tuesday, McLaren Racing announced that it would eliminate 1,200 jobs because of pandemic-related impacts on its business. Three divisions will be affected: automotive, applied technology, and racing.
Paul Walsh, head of the McLaren Group, said that the cuts will put the company in more of a control of its budget in the future, and will lead to the company becoming more competitive.
Paul Walsh: While this will have a significant impact on the shape and size of our F1 team, we will now begin to take the necessary measures to be ready to run at the cap from 2021 onward–to challenge again for race wins and championship.
The cap to which Walsh referred is F1’s new funding cap of $145 million, which is designed to control spending from next year on.
Walsh didn’t sugarcoat why he decided to make his most recent move: “We have already undertaken dramatic cost-saving measures across all areas of the business. But we have no other choice but to reduce the size of our workforce.”
According to British reports, the team will cut a quarter of its workforce, which will make the remaining staff total just over 4,000 people. The team had already gone through a rough transition. Ron Dennis was the team leader for many seasons before selling his stock in the company. Dennis was replaced by Zak Brown, who has since restructured the team to its current form.
McLaren is not alone in the F1 budget-cutting business. In two days, Renault will make a decision–prompted by a slowdown in worldwide car sales–and layoffs may also be in the offing, including in its Formula 1 program.
