The automotive industry has been one of the most affected due to the Chinese virus called Covid-19. In Formula 1, we have heard a lot of rumours and some facts saying that low and mid field teams are struggling to find money in order to maintain their teams in the highest category of motorsport. One of the most affected teams and brand that has been struggling a lot is Renault, if we remember, the French team is also an engine supplier for other teams and with all of their sales, that money could be used to improve and develop their car, but in 2018, they lost Toro Rosso since they chose Honda to be their engine supplier, in 2019 they lost Red Bull as the Honda engines which were used with their B-team (Toro Rosso) turned out in a well alternative. In 2020, Renault is supplying power units to McLaren, but in 2021, the British team will now move with Mercedes. These are huge money losses and it means that they will have less money to develop their car and their engine. Now, if we add the pandemic that the world is currently going through, it means that this is not the scenario that a team ever wants. In this piece, we are going to talk about McLaren and how the pandemic is affecting them.
McLaren F1 Team is one of the most known and historic teams in the category. They are part of the 4 most successful teams in the history. Last year, their season was an outstanding one as their two drivers (Carlos Sainz and Lando Norris) and all their engineers that work at the factory and at the track managed to achieve best of the rest (P4) in the constructors’ championship and an outstanding P6 in the drivers’ championship achieved by Carlos Sainz, who also beat Alex Albon’s Red Bull Racing. Everything was going well for the British team, but their situation is decreasing with the Covid-19 pandemic. Sky news has commented that McLaren will announce that 1,200 jobs will be lost. It is believed that Nissan, which is a Japanese car manufacturer, will announce 20,000 cuts of jobs.
McLaren is in a very fragile situation since they are hoping that the local UK government borrow up to £275m so they are still able to continue operating and their cars won’t be stuck in their factory and they can have sales. The 1,200 jobs that will be lost due to the pandemic equal more that 25% of their workforce, which is a total of around 4,000 people, and these are going to be of all departments, such as Formula 1, road-car and Applied Technologies operations. An insider of the enterprise has said that McLaren is being resized for the new reality.
“It is, undoubtedly, a challenging time for our company, and particularly our people, but especially those whose jobs may be affected. The company has already undertaken dramatic cost-saving measures across all areas of the business.” Commented the company’s executive chairman, Paul Walsh.
McLaren has been trying to gain money with investors and for possible loan from the government. It is worth say that McLaren has already tried to convince the government to approve a £150m loan but it was rejected since political businesses are also struggling. Paul Buddin, McLaren’s chief financial officer, told investors: “We are looking at a number of very credible sources, and that includes all [those we] might be expected to ask, including government, including third parties”.
McLaren is working together and helping each other so they can be saved of this Covid-19 pandemic. Ron Dennis, who has become one of Britain’s best-known businessmen, has offered McLaren a £275m deal. Mr. Dennis is a former McLaren boss, so he does not want to see the team in which he worked, suffering. Hopefully the British team is able to continue its operations without more problems and we wish hope to all the people whose jobs have been affected.