Caterham and Marussia F1 teams to miss United States and Brazil rounds

Formula 1's commercial boss Bernie Ecclestone confirmed in media reports that neither the Caterham or Marussia F1 teams will participate in the United States Grand Prix in Austin, Texas on the October 31 to November 2 weekend due to financial difficulties for both tail-end outfits.

Even before Marussia F1's absence at the US GP was declared, Caterham had been embroiled in a battle to remain on the grid due to complications following Tony Fernandes' sale of the team after the Malaysian businessman could not sustain the costs of running the team.

Caterham F1 published the following statement on their website on Wednesday, October 22:

On 29 June 2014, Caterham Enterprises Ltd, Caterham (UK) Ltd and Sheikh Mohamed Nasarudin (Seller) and their shareholders Tony Fernandes and Datuk Kamarudin Bin Meranun entered into a Sale and Purchase Agreement (SPA) with Engavest SA (Buyer) with regards to 1Malaysia Racing Team Sdn Bhd/Caterham F1 Team.

Since the date of the Agreement, the Seller has refused to comply with its legal obligations to transfer their shares to the Buyer. The Buyer has been left in the invidious position of funding the team without having legal title to the team it had bought. This is in total contradiction to the Seller's press release of 3 October 2014 which stated that Mr Fernandes and his Caterham Group had no longer any connection with the Caterham F1 Team.

The administrators of Caterham Sports Limited have been appointed on behalf of Export-Import Bank of Malaysia Berhad (Exim), a creditor of Mr Fernandes and the Caterham Group. The Buyer has no connection with Exim. Caterham Sports Ltd was a supplier company to the Caterham F1 Team. Very regrettably, the administrators' appointment has had devastating effects on the F1 Team's activities. Since their appointment, the administrators have released various press statements which have been severely detrimental to the management of the Caterham F1 team.

After three months of operating the Caterham F1 Team in good faith, the Buyer is now forced to explore all its options including the withdrawal of its management team. Lawyers have been instructed by the Buyer to bring all necessary claims against all parties, including Mr Fernandes who, as an owner, will run the F1 operation.

MARUSSIA ALSO IN TROUBLE
However, in a development that has been labeled a failure of Ecclestone and the F1 team bosses to agree to cost-cutting measures, Marussia F1's absence from Austin will mean that there will be less than 20 cars on the grid for the United States round.

The 2005 season was the last time the F1 grid consisted of less than eleven teams as the end of the 2002 season saw mounting concerns about the cost of competing in F1, which resulted in the number of teams competing drop from 12 to 10 from the 2003 to 2005 seasons.

ONLY NINE IN BRAZIL TOO
Due to the logistics of F1's freight, nether Caterham or Marussia are expected to make the trip to Sao Paulo for the Brazilian Grand Prix either.

As per the sporting regulations of F1, teams are permitted to miss up to three rounds of the world championship should circumstances absolutely compel them to do so.

The current crisis resulting from the cost of competition in F1 has lead to speculation of just eight teams competing in the 2015 season with each team being allowed to field three cars.

However, amid the cost-cutting debate, worryingly little seems to be being said about the unfair distribution of F1's annual revenue among the participants. The Formula One Group, which is being controlled by venture capitalists CVC, takes around 50 percent of F1's annual revenue that is believed to be in excess of 1 billion United States dollars.

Teams are made to do with the rest, which is awarded to them on a 'sliding scale' where the more successful teams (invariably the best funded) take the higher share of the remaining percentage and have to pay their hundreds of employees along with taxes and other costs.