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  • The cost to compete.

    In another thread, the subject kinda got off topic in regards to cost and thought it deemed its own topic because of the importance of competing in OW and now that Honda has spoke with the cost of the lease in 2006 (and being the sole supplier should make the costs fairly accurate), we can get a relative gauge in terms of cost.

    As Indycool pointed out, "Almost all IRL teams are buying new cars every year." we can get a clearer view of costs to compete. So lets take 1 or two teams that are financialy 'comfortable', both that will be running 2 cars next year, Penske and Rahal.

    (If I'm far off on these numbers please indicate)
    Refrences = a 2 car team with 2 backups + 1 chassis back at the shop to cover a crashed T car. 5 cars total. Cost for a chassis per the Indycar.com site (http://www.indycar.com/tech/chassis.php) of $309,000

    2 car team with 5 new chassis = $1.54 million annualy.
    Honda engine lease in 2006 (per car, per Honda) = $1.3 million.
    2 rollers, 1 engine lease per year, per car, dividing the 5th car in half = $2,072,000.00.

    Add both cars for the single team = $4,144,000.00

    Excluding payroll, fuel,tires,travel etc. because their all pretty relative but just looking at the chassis/lease costs, can we say to field a 2 car team in the IRL, with new cars every year + the lease for both cars is $4.2 million annualy?

  • #2
    Read here many times at 2 car operation can be ran in the $5,000,000 range so I'd say your numbers are as good as anyones........
    the man in expensive shoes

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    • #3
      Found numbers on the DP01: http://sc1.att.mindcomet.net/commentary/20641/
      "$205,000 less electronics and $300,000 for a roller."

      Beings that all the teams currently have electronics, we'll use the $205,000 figure.

      Champ Car, two car team with the DP01's and Cossworth lease (in 2007), same numbers (5 chassis) for a two car team.

      (5) Chassis for a two car team = $1,025,000.
      Engine lease @$750k per car (x)2 = $1.5 million.

      Total cost for a (2) car team, (5) new DP01 chassis with (2) engine leases = $2,525,000.

      IRL 2 car team with Honda engine lease for both cars = $4,140,000 (in 2006)

      CC 2 car team with Coss. engine lease and no new chassis $1,500,000 (in 2006)

      CC 2 car team with Coss. engine lease for both cars = $2,525,000 (in 2007)

      Comment


      • #4
        Originally posted by HardPoint
        Found numbers on the DP01: http://sc1.att.mindcomet.net/commentary/20641/
        "$205,000 less electronics and $300,000 for a roller."

        Beings that all the teams currently have electronics, we'll use the $205,000 figure.

        ...snip...
        I seriously doubt the electronics will just transfer over. Don't think the electronics are just the control pods and a couple of wires. You have dozens of sensors from ride height, tire pressure, shocks, air speed, exhaust temp, intake temp, dozens of little engine thing-a-ma-bobs (highly technical term), and all of this needs to go into a nice wiring package for the particular team so that their tlelmetry package works with it. I'd say you would be smart to use the roller figure instead.
        ...Always follow the money

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        • #5
          Champ Car owns PI.
          Panoz is building the new car around the Cossworth, which CC owns.
          Panoz is going to build a car, ignoring the electronics in which the series owns?

          All of the sensors you describe are PI sensors.

          Your example leads to someone having to buy all new elctronics, which would hold water if the DP01 was built around a different data aquisition company, which is silly to assume imo.

          Comment


          • #6
            Rahal in Feb 2003 when he stradled the fence said it cost the same to run a car in the IRL as it did Champcar.

            Easily $20 million for a two-car team. Then you have to add drivers' salaries—anything from zero to $5 or $6 million.

            Will an IRL budget be as large?

            Could be close to what a CART budget was [2001]. And one thing about ovals, there's no such thing as a small accident—they're all expensive. But there are money savers in the IRL, which CART basically copied. Freezing the chassis for three years, restrictions on development. The IRL is trying to protect teams from the unfettered development that manufacturers incite. Now with Honda and Toyota there, it's going to get harder.
            I believe it would be safe to say that IRL costs have risen since 2003, and Champcar costs have come down. Not everyone runs a team with the cost of Rahal, but you get the point.

            The $500,000 saving on the Honda is only the very tip of the iceberg.
            Asked how he’d like to be remembered were he hit by a bus tomorrow, Tracy doesn’t hesitate: “I’m a race-car driver. At the last second, I’d swerve and avoid the bus.”

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            • #7
              Originally posted by HardPoint
              Champ Car owns PI.
              Panoz is building the new car around the Cossworth, which CC owns.
              Panoz is going to build a car, ignoring the electronics in which the series owns?

              All of the sensors you describe are PI sensors.

              Your example leads to someone having to buy all new elctronics, which would hold water if the DP01 was built around a different data aquisition company, which is silly to assume imo.
              So you are telling me that each team is going to go through their old chassis, remove mounting hardware, connectors, data ack hard and soft points, create their own sheilded harnesses, fabricate their own mounting hardware, and attach the old sensors.

              Ya know, I can cut you a deal right now on a bridge..... some disasembly and assembly might be required, but it is a sweeeet deal.
              ...Always follow the money

              Comment


              • #8
                For the sake of argument, $300,000 for a DP01 roller. ($475,000 addition for 5 cars)

                IRL 2 car team with Honda engine lease for both cars = $4,140,000 (in 2006)

                CC 2 car team with Coss. engine lease and no new chassis $1,500,000 (in 2006)

                CC 2 car team with Coss. engine lease for both cars = $3,000,000 (in 2007)

                Along with a reduction in year long replacement costs:
                Steve Elkins:
                "In addition to that, we're also building in about a 50% reduction in the cost of the parts of the cars, the parts that everyone goes through every weekend, the wishbones, the uprights, the very much consumable parts. We've reduced the cost of all of those. The fact of the matter is we're using an American manufacturer helps that a lot also."
                --------


                The reason I started this thread is in the delicate OW climate where every scent is counted in terms of out of pocket cost, I think $$/participation will play a big factor in the very near future.

                Comment


                • #9
                  Forgot to add in the ammoritized cost for -

                  the shop
                  transporters
                  motorhome
                  scooters
                  payroll
                  insurance
                  office space
                  furniture
                  hospitality
                  etc,etc,
                  Have attended: Indy 500 (36), Belle Island (3), Kentucky (4), St Pete (3), Homestead (1), Texas (2) Michigan (5), Cleveland (3), Iowa (6), Chicagoland (5), IRP (2), Eldora (3)...

                  Comment


                  • #10
                    Originally posted by damilt
                    Forgot to add in the ammoritized cost for -

                    the shop
                    transporters
                    motorhome
                    scooters
                    payroll
                    insurance
                    office space
                    furniture
                    hospitality
                    etc,etc,
                    As I said above in the original post: "Excluding payroll, fuel,tires,travel etc. because their all pretty relative but just looking at the chassis/lease costs-"

                    Both series enjoy paying for the above, taking a simple look at one chassis/lease to another.

                    Comment


                    • #11
                      Originally posted by sightlines
                      The $500,000 saving on the Honda is only the very tip of the iceberg.
                      And the good ship IRL is the titanic?

                      jono

                      Comment


                      • #12
                        Originally posted by sportscarbruce
                        This is a response thread to HardPoint's question on IRL cost, what kind of cost can CCWS teams expect to encounter when the new chassis and engine takes effect? Current Lola spares, data, and the like are out the window, so that must be figured in. Then we have the cost of a clean-sheet chassis and new Cosworth engine. I don't suspect KK is looking to lose money on the engine so it can't be free or next to free. Then the transport cost from Mexico to Canada and all over the US must be figured. Last but not least no Indy 500 payout.

                        Anyone care to tackle it?
                        As I laid out links and factual numbers from both CC and the IRL, if there are numbers or questions abound on any of the above, can you post them?

                        "I don't suspect KK is looking to lose money on the engine so it can't be free or next to free." Any links on it being free or close to free? Theres a link to the $750K lease number.

                        "Indy payout" - is that payout currently helping any IRL teams right now that are in sponsorship trouble and would that payout help any CC teams in trouble? If you have links to cc teams with no sponsors, or teams that are in trouble currently due to cost, please post um up.

                        "Transportation costs" your right SCB, the IRL has CC beat there, the IRL only has to head west once. Anything else SCB?

                        The bottom line was to take a look at chassis/engine costs, which we have real world numbers to work with. If there are "free" or "close to free" concerns, feel free to post them. Or post a link to anything else you unearthed above.

                        Comment


                        • #13
                          Originally posted by SportscarBruce
                          "Oh.

                          From what some are suggesting '07 is supposed to be the year that teams leave IRL in droves and flock to CCWS. Economics is supposed to be the lynchpin in the predicted move, so help us understand how running in CCWS will be financially more attractive than in Indycar. The only way I can see that happening is if the CC cost to compete are held at an artifically low level until the IRL's back is broken. But maybe not. Show us why."
                          Where are people saying here that this 2007 situation is to unfold?

                          On your question of the "predicted move", I dunno. The only thing I heard was the Director of Ops. for Target/Chip Gannasi saying 'Chip is more likely looking at 2007, not 2006' back when that topic was in the media.

                          I think it was a week later (or two), when a reporter specificly asked Chip on this, he said the same thing, '2007, not 2006'.

                          Have you heard of anything else on the projected move of team or teams(s)? Because thats all I've heard. And you said that, "The only way I can see that happening is if the CC cost to compete are held at an artificialy low level".

                          Explain 'artificialy low'. Is a standard $750K cc engine lease 'artificialy low'? And as IC pointed out, most IRL teams buy new cars every year, so that cost difference to stay competitive is also there in the IRL.

                          Comment


                          • #14
                            But there's no Indy 500. Owning a AAA ball might be cheaper, but there's no World Series.

                            These numbers you're quoting on the newer but cheaper cars and engines to be in CCWS, are those subject to change or year-to-year? Hard to see how a clean-sheet design of each can be less expensive. No one would present speculative numbers to customers that later don't hold water, would they? Why that is unthinkable.

                            Comment


                            • #15
                              Originally posted by SportscarBruce
                              But there's no Indy 500. Owning a AAA ball might be cheaper, but there's no World Series.

                              These numbers you're quoting on the newer but cheaper cars and engines to be in CCWS, are those subject to change or year-to-year?
                              Could possibly. Honda says $1.3million for a motor in 2006, could those numbers be higher then expected? You bet. splitting hairs over what if's is silly imo. Like 'what if Honda said $1.3 to calm the waters just to turn around and make it $1.5mill? see how petty and conter productive that can be?

                              Hard to see how a clean-sheet design of each can be less expensive. No one would present speculative numbers to customers that later don't hold water, would they? Why that is unthinkable.
                              Hard to see? Look at the numbers.

                              Try again Bruce. This isn't Champ Car's numbers Bruce, its Panoz's. You might as well say Panoz is lying about the %35 less expensive roller compared to a Lola and the misleading %50 reduction in regularly replaced parts.
                              Last edited by Sybil D. Sobydianz; 12-21-2005, 05:14 AM.

                              Comment

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