Costs have become a major issue for F1 Formula One's teams and governing body the International Automobile Federation (FIA) have agreed key cost-cutting measures for the next two seasons. The packages come after Japanese manufacturer Honda pulled out of F1. The Formula One Teams Association (Fota) said as well as a package for 2010, an agreement for a cost-cutting plan for 2009 had also been reached. The details will be released on Friday after it has been approved by the FIA's World Motor Sport Council. "Agreement was reached on measures to meet all the objectives originally put forward by the FIA for 2010 and thereafter," said the FIA in a statement. "In addition to which Fota have now made proposals for very significant cost saving in 2009, while maintaining Formula One at the pinnacle of motor sport and reinforcing its appeal." Ferrari and Fota president Luca di Montezemolo added in the statement: "The unity of the teams was fundamental to meeting the goals for a new F1, but with the same DNA, as requested by the FIA." FIA chief Max Mosley had wanted the teams to use a standard engine and gearbox from 2010 to help cut their costs by up to 80%. 606: DEBATE Why not loosen the regs and allow open the sport to newcomers?
Regazzoni28 While Fota is committed to dramatically cutting the operating costs of the teams, it was opposed to the idea of one manufacturer, Cosworth, providing a standard engine for all the teams. A complete "powertrain" - with an engine supplied by Cosworth and gearbox from Xtrac and Ricardo - would cost the teams an initial up-front payment of £1.68m. The teams could build their own engines to the same specification as the Cosworth, or continue to use their existing units, but on a par in terms of performance. That would be followed by a fee of £5.4m per season over the three years of the agreement, running from 2010 through to 2012. Such a figure is around 10% of what teams have spent on engines in recent years. Ferrari and Toyota have previously threatened to quit the sport if a standard engine was to be introduced. Yet all the teams are committed to dramatically reducing their operating costs, particularly in the light of Honda's pull-out.
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Cosworth's 2004 Champ Car engine 
Formula One looks set to enter an era of standardised engines. The FIA is meeting with teams in Monte Carlo and is expected to approve the use by some teams of a standardised power unit provided by Cosworth, an automotive engineering company, from 2010 onwards. The move to a standard engine, which is common in lower tiers of open wheeled racing such as GP2, was pushed for by FIA President Max Mosley earlier this year as he aims to reduce team costs. This would not see the exclusion of manufacturer made engines, as at this time participation in the system would be voluntary and teams would be free to build licensed Cosworth engines or their own powerplants but on a performance par with the Cosworth unit. Mosley has stated that stabilising Formula One means that the FIA "...must stabilize the system with a base engine which anyone can have and which is inexpensive, as well as a standard gearbox" and has warned of future budget problems, saying that "Honda pulled out because of falling car sales and there is no guarantee that these falling sales, which affect all manufacturers, will not drop further".

Ahead of the meeting of the FIA there have been rumours in the Italian press that Formula One team Renault had broken with the Formula One Teams' Association (FOTA), rumours which Renault has strongly denied. FOTA was established earlier this year by the teams to negotiate with the FIA over cost cutting measures and other changes, changes it hopes will stop the introduction of compulsory standardisation of engines and other parts on F1 cars. The FOTA's position was hard hit last week by the announcement by Honda that they were leaving F1 due to the economic crisis, a move which has caused many teams to re-assert their commitment to a future in Formula One. David Richards, whose Prodrive entry to Formula One was called off last season due to costs, highlighted what he sees as the need for fundamental changes, saying that Honda's exit was 'a salutary lesson for the whole of F1 that things are going to have to change, and everything is going to have to come back a little bit if the whole sport is to prosper in the future'.

Five teams have reportedly expressed an interest in the Cosworth engines from the 2010 season, the five being all four independent teams (Williams, Force India, Red Bull Racing and Scuderia Toro Rosso) joined by manufacturer Renault. If only four teams sign up to the idea, the FIA has announced it will go ahead. Renault have been highly vocal in criticising the failure of the engine development freeze that has existed in Formula One and have, after a couple of seasons of struggling, been under pressure from their parent company to justify the continued expenditure in Formula One. Cosworth have previously been prolific engine suppliers in Formula One, their last stint was supplying engines to Williams in 2006.

The talks come as many of the Formula One teams are in Jerez for part of their winter testing regime, with potential Toro Rosso driver Sebastian Buemi topping the time sheets for the first two days.