Haas F1 in a Tough Spot

After the beginning of the Russian invasion of Ukraine, Formula 1 (F1) made the quick decision to cancel the Russian Grand Prix at the Sochi Autodrom that was scheduled for late September. For the CEO Stefano Domenicali and 10 team bosses it was the right decision given the situation, but one of the team bosses now faces an even larger and more complicated decision. Haas F1 team principal Gunther Steiner and team owner George Haas are now faced with a sponsorship decision that could have serious implications on this year’s team and potentially their future in F1. The current primary sponsor of the Haas cars is Uralkali, a Russian fertilizer company and their cars are painted like the Russian flag. If only the decision was as simple as a new paint job.

There are several significant decision points related to the future of the Haas and Uralkali relationship. While it doesn’t appear any official decisions have been made as of writing this, Haas made a statement by running an all white car in Friday’s final day of testing in Barcelona, removing reference to the Russian flag and Uralkali all together. They also indicated they will be taking time to make a decision this upcoming week. Let’s take a deeper dive into the impact of a decision to either continue with Uralkali as a sponsor or dissolve the partnership.

1. Money, money, money

The loss of a title sponsor of an F1 team would result in a huge financial hit for a team at the bottom of the grid week in and week out in 2021. If Haas were to dissolve their partnership with Uralkali, they would need to find another sponsor to fill the void and with inital testing complete and the season kicking off in Bahrain in just 3 weeks, that wouldn’t be an easy task. While the exact amount of money Uralkali has invested in Haas is unknown, it’s likely significant given Steiner’s comments that Haas would “not be here today [without Uralkali]” in September 2021. For a smaller team with shorter pockets, every dollar is even more significant than say a Mercedes team. Just for comparison, the Haas F1 team has around 200 employees, while the Mercedes AMG F1 team has around 980 employees. When your revenue is much lower overall, it’s harder to absorb a loss of revenue.

2. Driver Changes and Family Ties

It’s well documented that Haas driver Nikita Mazepin has a seat in F1 because of his father, Dmitry Mazepin, Chair of title sponsor Uralkali. As part of the partnership deal, Nikita must remain a driver for the team, which obviously complicates this situation. The elder Mazepin is associates with Russian Prime Minister Vladimir Putin, perhaps pushing the decision to drop Uralkali over the edge. The likely scenario if Uralkali is no longer the title sponsor is the end of Nikita Mazepin’s run in F1 (at least for Haas). Haas has said that test driver Pietro Fittipaldi is prepared to take the seat if needed, although it was in the context of Nikita Mazepin potentially being unable to get a visa to travel to all the F1 race locations. Fittipaldi certainly has F1 in his DNA, as he is the grandson of 2-time world champion Emerson Fittipaldi.

The biggest issue is timing. The first test session of the year in Barcelona is over and there is just one more test session (March 10-12 in Bahrain) before the season opens in Bahrain March 18-20. Haas had the fewest laps in Barcelona and now would be putting an inexperienced driver in a barely tested car. Now, Fittipaldi isn’t completely green in F1, he filled in for Romain Grosjean after his horrible accident in 2020 and started 2 races for Haas finishing 17th and 19th at Sakhir and Abu Dhabi respectively (the last place of any non-retired cars in both). Given Haas’ track record, I’m not sure a green driver in an untested car makes the situation worse than every race in 2021, but it’s a concerning turn of events that adds some anxiety.

3. Damaging Impacts of Keeping Uralkali

On the flip side of the coin is keeping Uralkali as the title sponsor. One obvious issue is public impression. It won’t sit well with most fans and drivers if Uralkali and the Russian flag colors are flying around the track each weekend. It would be a constant reminder of the conflict and would likely alienate the hearty fans of Haas, which is especially difficult in a period when United States interest in the sport of F1 is growing exponentially and at record highs thanks to the Netflix documentary “Drive to Survive.” The Haas name is well-known world-wide, but obviously means more in the US as the only US-based team owner.

A secondary issue with keeping Uralkali as a sponsor relates to driver travel and visa issues. As a Russian citizen, Nikita Mazepin has already had issues gaining entry into some countries where races have been held, including the US last fall. With the current conflict, I can’t imagine it will get easier for the Russian driver to travel and gain entry into different countries, making the driver situation week-by-week for Haas. Brazilian Fittipaldi is waiting in the wings should such a visa issue arise, but switching out drivers and limited practice time makes it near impossible to be competitive. Haas is already at a pretty massive disadvantage in money and staffing, to take another hit with inconsistent drivers would just make their likelihood of success drop even further.

Overall, it’s an incredibly difficult decision for Haas to make around their title sponsor. Without the title sponsor, the team may not have the money to compete in F1 and need to make even more drastic decisions about the future, but with Uralkali as a sponsor, they will be faced with alienation and potential weekly issues around which driver is available. In my opinion, the right and almost only decision at this point is to drop Uralkali and Nikita Mazepin and hope that another title sponsor is willing to jump in and save the Haas team. There are plenty of large corporations with deep pockets who could jump into the F1 game at this point. Pietro Fittipaldi represents the future for the team (if there is one) and there is no reason, other than a sponsorship agreement, that Mazepin should have a seat over him. I’ll be keeping a close eye on this development over the next week or two.

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