- The Washington Times - Tuesday, June 16, 2009

LONDON (AP) - Formula One’s governing body is sticking to its plans for a budget cap to avoid a “financial arms race,” despite threats from key teams to pull out of the sport if the plan is implemented.

Ferrari and other teams say they will withdraw from competition unless plans for a voluntary $60 million budget cap are scrapped.

FIA financial experts met Monday with their FOTA counterparts to discuss the cap.

“Unfortunately, the FOTA representatives announced that they had no mandate to discuss the FIA’s 2010 financial regulations. Indeed, they were not prepared to discuss regulation at all,” FIA said Tuesday. “As a result, the meeting could not achieve its purpose of comparing the FIA’s rules with the FOTA proposals with a view to finding a common position.

“In default of a proper dialogue, the FOTA financial proposals were discussed but it became clear that these would not be capable of limiting the expenditure of a team which had the resources to outspend its competitors. Another financial arms race would then be inevitable. The FIA financial regulations therefore remain as published.”

Five teams _ McLaren, Renault, Toyota, BMW Sauber and Brawn GP _ have until Friday to unconditionally sign up to the FIA’s budget cap due to take effect in the 2010 season.

A further three teams _ Ferrari, Red Bull Racing and Toro Rosso _ were, apparently against their wishes, entered by the FIA on Friday.

If FOTA and the FIA are unable to reach any agreement over the next few days, the latter has confirmed more new entrants will be named to make up the 13-team, 26-car grid for next season.

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