The cost cap is a rule introduced by the FIA that limits how much money a Formula 1 team can spend on developing and operating its car each season. It was introduced in 2021 to prevent the wealthiest teams from spending unlimited amounts and gaining an unfair advantage. The cap does not cover driver salaries or top executive pay. Teams that breach the cap face sporting and financial penalties. It is designed to make the championship more competitive over time.
Example: There are reports that the team may have exceeded the cost cap last season — the FIA investigation is ongoing.
The cost cap does not limit a team’s total budget — it specifically caps certain technical and operational spending areas, with a number of items excluded such as driver salaries.
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