F1: FIA Could Not Prove Ferrari’s (NYSE:RACE) Engine Was Illegal

F1: FIA Could Not Prove Ferrari’s (NYSE:RACE) Engine Was Illegal

$RACE

F1 bosses have explained that they reached a settlement with Ferrari over their engine case as they feared they would not be able to prove any wrongdoing.

Last week, the FIA said an agreement was reached with The Scuderia over a long-running analysis into their Y 2019 power unit due to questions raised by the car’s impressive straight-line speed.

Ferrari always denied any wrongdoing but a collection of 7 rival teams released a joint statement to voice a “strong objection“.

MercedesAMG, Red Bull, McLaren, Renault, Racing Point, Alpha Tauri and Williams co-signed the letter. Haas and Alfa Romeo who both use Ferrari engines did not sign.

The motorsport’s governing body has released a statement to explain why they did not pursue the investigation into the power unit any further.

It said: “The FIA has conducted detailed technical analysis on the Scuderia Ferrari Power Unit as it is entitled to do for any competitor in the FIA Formula One World Championship.

The extensive and thorough investigations undertaken during the 2019 season raised suspicions that the Scuderia Ferrari PU could be considered as not operating within the limits of the FIA regulations at all times.

The Scuderia Ferrari firmly opposed the suspicions and reiterated that its PU always operated in compliance with the regulations. The FIA was not fully satisfied but decided that further action would not necessarily result in a conclusive case due to the complexity of the matter and the material impossibility to provide the unequivocal evidence of a breach.

To avoid the negative consequences that a long litigation would entail especially in light of the uncertainty of the outcome of such litigations and in the best interest of the Championship and of its stakeholders, the FIA, in compliance with Article 4 (ii) of its Judicial and Disciplinary Rules (JDR), decided to enter into an effective and dissuasive settlement agreement with Ferrari to terminate the proceedings.

This type of agreement is a legal tool recognised as an essential component of any disciplinary system and is used by many public authorities and other sport federations in the handling of disputes.

The confidentiality of the terms of the settlement agreement is provided for by Article 4 (vi) of the JDR.” Fini

Ferrari is the Aristocrat of the automotive sector.

Enzo Ferrari’s iconic Italian Supercar manufacturer claimed the title according to the latest Brand Finance Global 500 2019 report launched at the World Economic Forum in Davos.

HeffX-LTN overall technical outlook for RACE is Neutral to Bullish, there is resistance 164.16 and Key support is at 151.98. As a bottom was put in last Friday at 152.51. My Key indicators are turning Very Bullish as the stock is very oversold in here.

Ferrari finished at 154.19, -6.19 after hrs Thursday in NY.

Ferrari will continue to create value in the long term. Ferrari is a quality 1st long term luxury products investment, and I have called it at it at 200+/share long term, adjusting it to 200/share short term and siding with BAML to 230 long term for now

Stay tuned…

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