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Red Bull Powertrains, or not? The Behind-the-Scenes Attempt to Keep Benefits

Anyone that follows F1, or has seen Drive to Survive will remember Red Bull's engine supplier struggles and drama over the past several seasons. With the official departure of Honda from F1 (again) at the end of last season, Red Bull decided to create their engine program so they wouldn't have to put up with any supplier issues like they did with Renault, or a supplier pulling out like Honda did ever again. Originally this decision meant that starting in 2022, all Red Bull engines would be branded a Red Bull Powertrain component despite the engine specification freeze in effect until 2026, with Red Bull designing their first powertrain for the new set of regulations. However, a wrinkle has been thrown into this plan by the Volkswagen Group, which is rumored to enter Formula One at the same time as the new engine regulations in 2026. Let's dissect red bull's original plan, these complications, and how likely Red Bull is going to be able to pull this one off.

As I stated above, Red Bull's original intention was to take over the manufacturer and maintenance of the Honda design powertrains starting this year. This included a transfer of the intellectual property that Honda owns regarding the motor to Red Bull, so they would be able to build and maintain the engines without any direct involvement from Japan. This original plan would have allowed Red Bull to continue to use the Honda powertrain that helped it win the world title last season at a time when regulations are frozen, meaning that they would be at no disadvantage to any other engine supplier, particularly Mercedes or Ferrari. Since this original plan was hatched last year when Honda announced it would no longer be participating in Formula One past the conclusion of the season, it made perfect sense and was the logical step for Red Bull to take. However, since then developments in the world of Formula One have caused them to back off of that original plan in hopes of getting added benefits when the new regulations begin.

This wrinkle in the original Red Bull plan was caused by speculation which now seems to have solidified into real news, which is that the Volkswagen Group plans to enter Formula One with both Audi and Porsche brands. Speculation suggests that the Volkswagen Group ideally would want to have an Audi works team, meaning that a team's primary sponsor (if not the outright owner) would be Audi, who would be responsible for the design of the car as well as the production of an engine. While it's unclear which team exactly might take on the Audi project, a strong case could be made for either Alpha Tauri, Williams, or Alfa Romeo. Porsche though has been linked closely linked with Red Bull and their new engine department for collaborating on a Porsche-branded power unit. This is a logical pairing, as Red Bull has already built the infrastructure and testing equipment necessary to design and maintain a Formula One engine in the UK, and would be a very easy “plug and play” for a new engine manufacturer to jump into the sport and hit the ground running. However, this speculation has caused Red Bull's original plan of maintaining, building, and receiving the intellectual property from Honda a little bit more complex.

Within the regulation of Formula One by the FIA, there are special provisions in place for the new engine regulations four new engine manufacturers that will potentially enter the sport, regulations which the Volkswagen Group has been instrumental in arguing for due to their planned entries. These added benefits include a higher operating budget, more development time, and more time on the dyno to test the engines as well. This is all designed so that a new manufacturer that enters Formula One does not have to operate from a disadvantageous position at first until they “catch up” with the development of the established engine suppliers.

Recently, the rumors of the Porsche Red Bull partnership have become more solidified as Red Bull has changed their approach for the remaining time of the engine freeze in hopes that they will be afforded the “new” engine supplier benefits when Porsche announces their official entry into Formula One. Because Porsche is likely planning to partner with Red Bull, they have put a halt on their original plans to acquire the intellectual property from Honda and build and maintain the engines for the duration of the engine freeze under the Red Bull powertrains moniker. Instead, Red Bull and Honda have come to an agreement where Honda will maintain the intellectual property, continue to build in service the engines, and provide all development and technical support to the team through the engine freeze. This essentially makes Honda the “unofficial” official engine supplier for Red Bull, with the hope being that the FIA will then as a result allow Red Bull and Porsche the extra dyno time and budget associated with being a new engine supplier, despite the existence of Red Bull powertrains for several years by that point.

There are a couple of things about this decision that make it interesting from a legal and political standpoint. One is going to be the marketing of Honda on the Red Bull cars going forward. Currently, on the engine cover of the Red Bull car there is a small decal recognizing Honda's part in the production of the engine, but no widespread advertisement for them as there was last year because Red Bull powertrains are the “official” manufacturer. For Red Bull’s new plan to work, their cars going forward will have to have more Honda branding to highlight this increased involvement by Honda to convincingly show the FIA that Honda is the “actual” engine supplier, not Red Bull. this decision also raises eyebrows because of the surprising decision for Honda to leave Formula One after just handful of seasons of being back with Red Bull. It wasn't that the engineers at Honda didn't want to continue, it was that their profit-motivated board decided that they couldn't afford to spend the immense amount of resources required to maintain a Formula One engine program anymore. But here they are less than a year after making that decision, committing to essentially doing just what they said they “couldn't afford to do” again.

Beyond these attempts by Red Bull to show they aren’t the engine supplier yet, there's still the issue of whether or not this plan will work and convince the FIA and the other Formula One teams to afford Red Bull Powertrains these benefits. Ultimately, it's not up to Red Bull whether they get these benefits—it's going to be up to the FIA, with the other engine suppliers having a say as well. That's going to be a hard sell to the likes of Ferrari and Mercedes, the other two major engine suppliers, and Formula One because they are witnessing exactly what we are, and just like us, they will see right through it and understand what Red Bull is trying to accomplish here.

All this is to say that Red Bull Powertrains will certainly have an uphill battle in front of them to attain these benefits of being an engine supplier, and their trickery and optics surrounding Red Bull Powertrains will likely continue to evolve and play a major role in whether or not they can receive these benefits come the new engine regulations.

Zachary Bryson is a graduate from Wake Forest University with B.A. in Economics and a Minor in Entrepreneurship. He is currently JD candidate at Elon University School of Law, Class of 2023. You can connect with him via LinkedIn or follow him on twitter at @ZacharySBryson.

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