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Max Verstappen claimed the 2024 Drivers' Championship, further cementing his dominance in Formula 1, while McLaren emerged victorious in the Constructors' Championship. Although Verstappen’s individual performance was outstanding, McLaren’s strong and consistent results throughout the season earned them the coveted title as the top team in the standings.
In Formula 1, prize money is primarily distributed based on the standings in the Constructors' Championship. Teams that finish higher in the rankings receive a larger portion of the prize pool. However, while drivers do not directly receive prize money for their race victories, they often benefit from additional financial rewards, including performance-based bonuses. These bonuses, which can be substantial, are often tied to a driver's success in races and championship standings.
How Much Do Drivers Earn?
The highest-paid driver in Formula 1 for 2024 is Max Verstappen, who surpassed his longtime rival Lewis Hamilton. Verstappen, under contract with Red Bull, is set to earn $55 million annually through 2028. Lewis Hamilton, who is in his final season with Mercedes before moving to Ferrari in 2025, currently earns $45 million annually. After his transfer to Ferrari, Hamilton’s annual income is expected to rise to approximately $100 million, including bonuses.
The following is a list of some of the top drivers in Formula 1 for 2024, detailing their salaries and contract years:
1. Max Verstappen (Red Bull) – $55 million (contract until 2028)
2. Lewis Hamilton (Mercedes) – $45 million (contract until 2025)
3. Charles Leclerc (Ferrari) – $34 million (contract until 2028)
4. Lando Norris (McLaren) – $20 million (contract until 2025)
5. George Russell (Mercedes) – $18 million (contract until 2025)
6. Fernando Alonso (Aston Martin) – $18 million (2024 contract)
7. Checo Perez (Red Bull Racing) – $14 million (2024 contract)
8. Carlos Sainz (Ferrari) – $12 million (2024 contract)
9. Valtteri Bottas (Kick Sauber) – $10 million (2024 contract)
10. Daniel Ricciardo (Red Bull) – $7 million (2024 contract)
While these salaries reflect the earnings from base contracts, drivers may also benefit from bonuses tied to race victories, podium finishes, and championship standings. This bonus structure ensures that the top drivers earn even more than their fixed salaries, with success on the track leading to increased financial rewards.
How Much Do Constructors Earn?
The financial rewards for Formula 1 teams are also heavily tied to their performance in the Constructors' Championship. The team that finishes first in the Constructors’ standings receives the largest share of the prize pool. In 2023, Red Bull secured the top position in the Constructors' Championship and is estimated to have received approximately $140 million. This amount represents about 14% of the total prize money for the season. Interestingly, this figure is just $5 million more than the 2023 cost cap, highlighting the significant financial stakes involved for the top teams.
However, prize money is just one source of income for F1 teams. In addition to their share of the prize pool, teams generate substantial revenue through sponsorships, merchandise sales, and commercial partnerships. These additional revenue streams can be just as important, if not more so, than prize money. For instance, while Red Bull’s $140 million prize payout for winning the Constructors' Championship is substantial, the team's overall financial success is also driven by its lucrative sponsorship deals and marketing partnerships.
The Importance of Championship Points
The amount of prize money a team receives is directly linked to the number of points it accrues throughout the season. The team that finishes at the top of the Constructors' standings, based on total points, is awarded the prestigious FIA Formula One World Constructors' Championship Trophy. Teams continue to compete fiercely throughout the season, as each point gained or lost can have a significant financial impact.
