After a prolonged struggle for several years, Andretti Formula Racing LLC's bid to join the F1 grid is now within touching distance as the FIA has approved its application to become the 11th team in the sport. The final step is to reach an agreement about the commercial discussions with Formula One Management (FOM).
The team, owned by former IndyCar champion and F1 driver Michael Andretti, has been knocking on the doors of the pinnacle of motorsports for several years. Although Andretti is a household name in American motorsports, their bid to join Formula 1 has been a distant dream until now.
Michael made the first attempts to put his team on the F1 grid in 2021 with various bids to buy existing teams. He was very close to striking a deal with Sauber until the Swiss team backed out at the last minute. This motivated him to create his own F1 team from scratch.
Earlier this year, when American Motorsports patrons announced its F1 bid, the team announced a partnership with General Motors-owned Cadillac to boost its application. Following a long period of deliberation by the FIA, it recently announced Andretti Formula Racing LLC as the only applicant that passed its "stringent criteria".
"Assessment of each application was based on sporting, technical and financial analysis - Review process included sustainability and positive societal impact criteria - FIA concluded that Andretti Formula Racing LLC will proceed to the next stage of the application process to enter Formula 1 from a list of four final applicants in Phase 2," the FIA noted.
Following the completion of Phase 2, for the final step of the process, FIA has referred the successful applicant to the FOM for commercial discussions.
After getting FIA's approval, Andretti F1 faces its toughest challenge yet
Soon after the governing body made its announcement, F1 released its own statement where it announced that it would now assess the "merits" of the remaining applicant.
"We note the FIA’s conclusions in relation to the first and second phases of their process and will now conduct our own assessment of the merits of the remaining application," the FIA stated.
While Andretti's bid passed the first two phases with flying colors, its toughest challenge will be the upcoming commercial discussions with the FOM. It will be an uphill battle for the team as the management and the current 10 teams have voiced their opinion against an 11th team, as its existence would dilute the prize money.
However, the Concorde Agreement allows for up to 12 teams in the sport and mandates a $200m (£165m) anti-dilution fee to be paid by the new entrant, which is split among the 10 teams. This fee is also under scrutiny as most teams have suggested increasing the fee given the sport's popularity and the current valuation of the teams.
Hence, Michael will have to make a strong case on how his team would add "value" to the sport, which F1 CEO Stefano Domenicali has emphasized as the key factor in deciding a new entrant.
According to various reports, under the EU laws, the American motorsports organization could also pursue a legal route if its application is rejected by FOM.