Why Formula 1 is the big winner with entry of brand-new American team

The FIA announced in 2023 that the Andretti F1 project met the technical and sporting rules to be on the grid in 2026, forwarding the bid onto commercial talks with Formula 1 management (FOM). 

But FOM gave a negative opinion after negtioations seemingly blocking the prospect of an 11th team joining the grid, with RacingNews365 writing at the time that F1 was shooting itself in the foot with this decision.

In the end, FOM has come around, especially since the Andretti name is no longer attached to the project, but that of General Motors and Cadillac. In short, that made a desired difference for F1.

All in all, however, little has changed in the background. Yes, Michael Andretti has left the project, but the same people are still involved. Just as Greg Maffei is leaving as CEO of Liberty Media means organization is not suddenly completely different. 

The FIA will be delighted with the choice to get the American team on the grid in 2026, and it feels like a huge victory for the FIA, which gets its desired outcome having opened the entry process in January 2023, with a project being admitted that it felt met the demands of the technical and sporting regulations.

FOM holds the commercial rights, but it is the FIA that judges an entry based on the technical and sporting regulations. 

Andretti was deemed not to be strong enough commercially, but with the Cadillac name, F1's biggest obstacle is off the table and therefore it seems guaranteed that we will see Cadillac F1 on the grid in 2026. 

A win for the FIA

It is abundantly clear that F1 and the FIA are often not on the same page, but Cadillac's entry does allow the FIA to throw more weight around. 

Even though the federation has often been in the news lately due to departed and fired employees, one of its main targets was to be able to welcome Andretti/GM as a new team. The FIA's determination now puts the federation in a stronger position regarding negotiations for the new Concorde Agreement, with the current one set to expire at the end of the 2025 season.

This provides an interesting subplot to Cadillac's entry, with the new Concorde set to be in place for 2026 in that under the existing agreement, a new team has to put down $200 million in an anti-dilution fee to be split among the existing 10 teams, with questions set to be asked about the status of the fee. 

Elsewhere Cadillac has yet to find an engine supplier for 2026 and 2027, with its own in-house unit set to be operational from 2028. 

RacingNews365 understands that Cadillac has been working on developing its own unit for some time and it is a certainty that the team will be a full works outfit by 2028 - but a customer supply is needed for the first two seasons. 

Mario Andretti, serving as an advisor, has since confirmed that a Ferrari supply is the favoured option, with this option making the possibility of a takeover of Alpine significantly less likely.

Big player in America

In the paddock, things initially remained remarkably quiet around the Andretti/GM F1 project. 

It was widely assumed that the project was dead in the water, but the team continued to recruit personnel with as many as 300 joining, including some from current teams. That shows the lure the project has, with the green light now set to speed up the hiring process, which should be straightforward given GM has an annual turnover of around $170 billion. Cadillac is expected to be at war strength in the near future.

The scale of GM's pockets, some smaller existing teams will be sweating as the willpower and investments made over the previous months indicate that American outfit will be gunning for the world championship.

This will not happen in 2026 or 2027, but from 2028 onwards, a competitive Cadillac absolutely cannot be ruled out. Indeed, GM and Andretti Global's achievements in motorsports speak for themselves - it has both the resources and ambition to achieve success.

Given the team's background in sports and finance, it is more than justified to be on the grid in 2026. 

A fourth Grand Prix in the United States would help further establish the series, but a truly American F1 team puts the sport even more on the map.

The question is whether the American public will embrace the Cadillac name as much as Andretti. After all, the family name is associated with car racing in the U.S., while GM/Cadillac is not as engrained in the racing consciousness.

But the story of the underdog will resonate with American racing fans.

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Good news for F1 teams

Despite the fact that F1 teams have no right to decide whether to allow another team to join the sport, it was clear by early 2024 that many if not all teams were opposed to Andretti's arrival. 

Several negative opinions about the project as well as the individuals were circulating and it seemed that teams and team bosses were doing everything they could to influence the process of a possible entry. 

Indeed, the negative opinions in the press made many people in the paddock and beyond feel that the Andretti/GM project did not stand a chance. 

The teams also wanted to increase the anti-dilution fee demanded from a new team, by as much as $400 million on top of the current amount of $200 million, with the idea of the fee being to protect the existing 10 teams as the prize money pie would be split 11 ways instead of 10.

But having an American team and generating sponsor interest will increase the overall scale of the pie - meaning more money and revenue for F1 and the teams, in a market F1 has tried to crack almost since the start of the world championship.

After all, every TV viewer in America is worth more than a viewer anywhere else in the world, with the NFL and top five European football leagues a good comparison.

The NFL makes more money annually than the Premier League, La Liga, Serie A, Bundesliga and Ligue 1 combined. More people watch the five football leagues from England, Spain, Italy, Germany and France, but the American spectator simply has more money to spend annd is therefore worth more in terms of advertisements. Quality over quantity.

This is also true in Formula 1.

Still, relatively few Americans watch Formula 1 (about 1 to 1.5 million people per race), but ESPN would happily pay about 75-90 million a year for the TV rights of Formula 1 in America.

If Formula 1 wants to grow in America, a real American team seems to be the way to a larger fan base, growing the group brings in more money for the F1 organization and automatically for all F1 teams. 

In addition, look at how many American sponsors have made the move to F1 in recent years and count your profits. When Cadillac joins, there will be even more American companies interested in the sport. 

As described earlier this year, the F1 organization was on the verge of shooting itself in the foot and should be glad they have backtracked on this decision, but what was the genesis of the rethink remains rather uncertain.