Since 2021, F1 has operated under a budget cap — a strict spending limit meant to level the playing field and stop teams from buying their way to victory.
What is the 2025 budget cap?
The core cap for the season is $135 million per team.
This covers most performance-related spending — including car development, parts production, and race operations.
What’s included in the cap?
- Car components
- Research & development
- On-track operations
- Most team personnel salaries
- Freight and travel (with some allowances)
What’s not included?
- Driver salaries
- Top 3 staff salaries (team principal, CTO, etc.)
- Marketing, hospitality
- Engine development (separate rules)
- Cost of damage from accidents or natural disasters (limited exclusions)
Does the cap change year to year?
Yes — the cap adjusts slightly for inflation and number of races. Extra allowances may be made for long calendars or new races.
Who monitors it?
The FIA Cost Cap Administration checks all spending. Teams submit detailed financial reports and are subject to audits.
What happens if a team breaks the budget cap?
Penalties range from:
- Fines
- Points deductions
- Reduced wind tunnel time
- In serious cases: suspensions or disqualification
Why does the budget cap matter?
It forces teams to spend smarter, not just more — making success more about efficiency, talent, and innovation than raw cash.
