Bipartisan senators call for DOJ investigation into FOM’s postponement of Andretti-Cadillac entry

A bipartisan group of senators has called on the Department of Justice (DOJ) to investigate Formula One Management (FOM) for shelving Andretti-Cadillac’s attempts to enter Formula One.

Andretti has been confirmed by the FIA ​​as meeting the requirements set by the governing body last year for any potential new signing, bringing him to the point where he can attempt to agree commercial terms with the FOM.

After conducting an analysis, the FOM said in January that it would not accept Andretti-Cadillac in 2025 or 2026, partly due to the need to draw on a customer power supply from Renault – potentially mandatory if a deal is not reached could be – but would be more open to entry in 2028, when General Motors has announced its intention to produce its own engine.

Since there has been no significant movement, members of Congress wrote to Liberty Media about the situation earlier this month, and now U.S. Senators Todd Young (Republican – Indiana), Amy Klobuchar (Democrat – Minnesota) and Mike Lee (Republican – Utah ) called to request the DOJ to investigate.

The letter, signed by several other senators and addressed to DOJ Antitrust Division Assistant Attorney General Jonathan Kanter and Federal Trade Commission (FTC) Chairwoman Lina Khan, does not address the 2028 potential , but describes the situation as “the exclusion of Andretti Formula Racing, LLC from participation in the Formula 1 championship series” and focuses on both on-track competition and GM’s position in the European automotive market.

The full text of the letter is listed below:

Dear Deputy Attorney General Kanter and Chairman Khan,

We write because we fear that Formula One, at the behest of its independent teams and other “key stakeholders,” including foreign automakers, is removing the team created by Andretti Formula Racing, LLC from its partnership with General Motors (“Team Andretti-Cadillac”) “) is excluded from entry into the Formula 1 championship series. It’s possible that such a denial of a deal — particularly if orchestrated through a group boycott — could violate U.S. antitrust laws.

The Formula 1 Championship Series (“F1”) currently consists of 10 teams; However, neither team races a US-made car with US-made components driven by an American. Eleven teams competed in Formula 1 in 2016 and twelve teams competed in 2012. In February 2023, the Fédération Internationale de l’Automobile (“FIA”), the umbrella organization for Formula 1 and other motorsports, opened a comprehensive application process. to allow potential teams to fill the vacant spots on the F1 grid. Of the applicants, it was assumed that only the Andretti-Cadillac team met the FIA’s strict criteria.

Once approved, the commercial terms and conditions for Team Andretti-Cadillac’s participation in Formula 1 should be negotiated with Formula One Management (“FOM”). Instead of negotiating commercial terms, FOM unilaterally rejected Team Andretti-Cadillac’s request. FOM postulated that the Andretti-Cadillac team would not benefit Formula 1 financially and would not be competitive, “particularly in terms of podium finishes and race wins”. This is in stark contrast to the technical approval given prior to commercial negotiations. Furthermore, the vast majority of F1 teams fail to win races in a given season. In 2023, a single team won all but one race, and half the teams in Formula 1 failed to win a race in the last four seasons combined. This competitive balance has not been the hallmark of Formula One racing, and the addition of a team backed by a major U.S. automaker is likely to increase, not decrease, competitiveness.

FOM also expressed concern about Team Andretti-Cadillac’s need to secure a “power unit” (the engine), although it stated that “GM has the resources and credibility to more than meet this challenge (of development). It’s worth noting that there are only four manufacturers making power units, and the addition of GM would lead to more competition in this highly specialized market.

What was most striking, however, was the FOM’s determination that the inclusion of the Andretti-Cadillac team in Formula 1 would “not add any added value to the championship”. Although Formula 1 does not currently have a US-based team, it is committed to increasing its presence in the US market. In recent years, more than a million Americans have watched every Formula 1 race, and that number has more than doubled in recent seasons. Last year, Formula 1 held three races in America, in Miami, Las Vegas and Austin, while no other country hosted more than one race. Even individual teams like Red Bull are wooing U.S. fans by hosting events in U.S. cities to “experience the wonder of Formula 1 engineering first hand and bring Formula 1 fans together.” There is clearly a financial incentive to add an American team to the Formula 1 roster, and there is no reason to block Team Andretti-Cadillac unless the FOM is trying to shield its current partners from competition.

Given these facts, we have serious concerns that Team Andretti-Cadillac’s rejection was based on a desire to exclude a rival from the circuit, marketing opportunities and the prestige that competition in Formula 1 can give to a car manufacturer that is competing Globus is responsible for selling cars all over the world. While the FOM maintains that it did not consult with the current teams before rejecting Team Andretti-Cadillac, it specifically points to consultations with “key stakeholders” that are likely to include team sponsors, including automakers that deal directly with General Motors and Cadillac compete. That F1 stakeholders may have taken concerted action to exclude the Andretti-Cadillac team – particularly after it had met all the technical requirements to join F1 – deserves investigation.

We thank you for your attention to this important issue.