FIA introduces salary offset in 2026 F1 cost cap for Audi

The Sauber-run Audi team will no longer be handicapped by Switzerland's higher cost of living

The FIA has introduced a cost cap offset in Formula 1's 2026 financial regulations to accommodate the Audi team's higher salaries in Switzerland.

Sauber has long argued its staff costs are a big handicap as it fights to become competitive due to the much higher wages and cost of living in Switzerland compared to its rival teams in the UK and Italy.

The Sauber team is also continuing its push for the new regulations to include an offset for teams operating in countries with higher salary levels than the UK or Italy.

According to figures from the figures from the Organisation for Economic Co-Operation and Development (OECD), the average wage in Switzerland in 2022 was $80,000 compared to $54,000 in the UK, where most other teams are based. That means the Hinwil-based team, which will become the Audi works team from 2026 onwards, has significantly less headroom to spend resources on performance and car development.

The FIA has now agreed that Sauber's situation is not fair and will work on a cost cap offset from 2026 based on OECD salary data, which has been incorporated in the latest version of the financial regulations.

"It is our responsibility to be fair," FIA single-seater director Nikolas Tombazis said at Austin's US Grand Prix. "It became obvious to us that salaries in certain countries are much, much higher and cost of life is much higher in certain countries.

"I see it myself, I live in Geneva. Whenever I go to the supermarket I think about it. And we felt that a team based in a high labour-cost country like Switzerland would end up having approximately 30% or even 40% fewer people working on the car, which we felt was fundamentally unfair.

"We've decided that this could either lead to us trying to take some protections from a regulatory point., or it would eventually mean that teams could not operate and a team like Sauber would have to basically close and move to another country, which we don't think is the right way for world championship to operate.

"So, that's why there's an adjustment in the financial regulations for 2026 which will basically adjust the salaries that gets considered in the cost gap by some factors that get determined by OECD data, data that's available to the world. As we get data from teams, we know that this OECD data is very consistent with the salary differences that exist within Formula 1 context and amongst the engineers of teams. So it's not just OECD data."

For 2026, the F1 cost cap has been raised from $135m to $215m after including a whole raft of new items under the financial regulations.

Rather than a large net increase in the amount F1 teams will be spending, the new figure will now include several items in the new cap that were previously exempted. The higher figure also takes into account inflation adjustments as well as changes to the exchange rate.

The additional $300,000 allowance for each sprint race is one item now included in the base figure, while the $1.8m allowance for any race over the ceiling of 21 has been raised to 24 grands prix per season.

Teams can also no longer write off certain R&D costs made under the UK research and development expenditure credit scheme.