Ambiguity remains over size of Hamilton’s Ferrari contract

Ambiguity remains over size of Hamilton’s Ferrari contract

Lewis Hamilton will logically earn a huge salary at Ferrari. At 40, the seven-time world champion is making a dreamed and at the same time bold move to another F1 team.

It will be a huge challenge for Hamilton to lead the team to a world title, and he will also have to beat Charles Leclerc to that goal, and therefore, Hamilton will certainly not be racing for a lower salary.

As a rule, the Italian media are well-versed when it comes to the salaries of Ferrari drivers, but at the moment, reports still vary as to how much Hamilton’s salary will be.

For example, there is talk of a $50 million salary, a $100 million salary and amounts well above that. In 2023 at Mercedes, Hamilton would have received a fixed salary of $35 million. That does not include bonuses. That amount went up with his new two-year contract to around $45 million a year.

Given the sporting challenge, the salary offered by Ferrari will have been sizeable.

When you look at Hamilton’s addition commercially, it is fairly easy to conclude that Ferrari had to dig even deeper. Still, they were happy to pay it.

The Briton is still the most popular and well-known driver in the world. In addition, he is very focused on fashion, including bringing Tommy Hilfiger to Mercedes, and Ferrari wants to take another big step in that area.

There is also some ambiguity about the length of his contract. Ferrari reported only that it is a multi-year deal.

There is talk in Italy of a two- or three-year contract, although it is also quite possible that a so-called 2+1 construction is on the table.

That would mean Hamilton will drive for Ferrari in 2025 and 2026, then the two sides will evaluate and see if they want to take up an option for a third year.

Clothing brand

In 2023, Ferrari had revenues of $6.4 billion and reportedly a third of the amount came from merchandise. That includes not only merchandise such as caps and shirts from the F1 team, but also scale models of both the F1 cars and the road car arm.

In addition, Ferrari has also established a luxury clothing brand. These clothes are often worn by Ferrari’s current drivers during GP weekends, and the brand is gaining prominence.

Thus, the clothing brand is already generating some merchandise revenue. That amount is estimated at two billion dollars. It stands to reason that Ferrari’s clothing brand will benefit from the positive global response to Hamilton’s arrival.

The now 39-year-old driver is very fashion-conscious and is going to provide an additional boost to the clothing brand with Ferrari. Extra revenue guaranteed you might say.

It is still unknown what arrangements were made in terms of salary or bonus payments. In itself, it was already a big surprise to the whole world that Hamilton is switching to the Scuderia.

No doubt the two sides will have an agreement in terms of clothing/merchandise, giving Hamilton a further boost to the base salary and sporting bonuses.

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In 2023, rumors of a possible Ferrari move by Hamilton were harshly quashed, as the seven-time world champion would never give up his ambassadorship at Mercedes.

Indeed, agreements were previously made between Mercedes and Hamilton that he would continue to play a role at the German marque beyond his F1 career. This logically meant that Hamilton would still be paid handsomely by Mercedes after his career, as they recognized that he could then play a major role for the car brand as well.

It’s great for a brand of Mercedes’ size when you can tie a seven-time world champion to your brand forever, but it doesn’t come cheap.

Yet Hamilton decided to leave, which means he would see the ambassadorship pass him by. No problem, because Ferrari is only too happy to take over this “bonus” from Mercedes.

Ferrari cannot imagine a better ambassador at the moment, especially since Hamilton is also so well-known in the fashion world.

So Ferrari is hitting the mark athletically, in terms of merchandise and of ambassadors.

However, this ensures that Hamilton will earn a mega sum at Ferrari. The quoted figure of over a hundred million dollars sounds quite realistic when you consider what Hamilton was already earning in fixed salary at Mercedes. Add to that his contribution for Ferrari and the circle is complete.

The amount, in fact, seems to be “peanuts” when you consider what Ferrari is guaranteed to earn from him.

It is going to be immense, without Hamilton having taken a single victory or title for the Scuderia. So the switch is certainly a brilliant decision by the Italians on a financial level.

The credit seems to go especially to John Elkann. He didn’t give up and wanted to bring in Hamilton no matter what. As a chairman, it makes sense for him to look at the business side first and know that Ferrari is going to receive a huge boost financially with the arrival of Hamilton.

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