Complications and negotiations related to Perez's departure from Red Bull

It has been quite clear for a while that Sergio Perez is not going to be a part of Red Bull's future in Formula 1 as a result of his tumultuous 2024 campaign.

However, it wasn't as obvious how precisely the split would end as a result of complications brought on by him being under contract.

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This was the results of Red Bull's decision in June to increase Perez by two years for 2025 and 2026, which the team said was intended to reassure him.

As Red Bull team principal Christian Horner admitted earlier this month concerning the call: “We decided to depart early, which obviously didn't work. Sometimes that's life.”

However, once he committed himself to it, Red Bull couldn't change his mind and easily settle on his own that he would relatively do something else.

In the world of massive money F1, drivers and their managers should not willing to easily break multi-million-dollar contracts and walk away without presenting any type of agreement.

The major weapon in Perez's arsenal was his veteran manager Julian Jakobi, who’s well-known for pushing hard bargains having worked with the likes of Ayrton Senna, Alain Prost and Jacques Villeneuve during his long F1 profession.

Sergio Perez with manager Julian Jakobi in 2021

Photo: Steven Tee / Motorsport Images

Red Bull were well aware of the contract situation in the ultimate stages of the season, when results made it clear they desired to make a change, but in addition they understood that there have been other aspects that clouded the situation.

He knew Perez needed to acknowledge the fact of the situation he found himself in.

However, achieving the specified result is rarely easy because on the subject of reaching an agreement to finish contracts, either side play an obvious game. If you recognize that you simply are the person the opposite party desires to do away with, it’s best to repeatedly make it clear that you simply intend to see things through. You see this occur time and time again when people know there’s a likelihood they can be transferred – so that they stare at it.

One famous example was the 2021 Brazilian Grand Prix, where then Aston Martin boss Otmar Szafnauer's days were numbered as he was linked with a switch to Alpine. Speaking at a press conference this weekend and asking about his future, his stance was defiant but specific: “I've been in the band for 12 years and I have no intention of leaving.” Two months later, his departure was finally confirmed and an exit package was introduced.

Playing hardball on keeping the contract signifies that when the lawyers are available, they’ll argue that any move to terminate the contract should be compensated with as much compensation as possible.

If you let it slip that you simply're open to a deal or that you simply're occupied with going for a walk anyway, it’ll weaken your hand in negotiations.

It was a battle that looked as if it would unfold within the closing stages of the season as Perez, keenly aware that the writing was on the wall, dug deeper and deeper into his determination to race with Red Bull and explained his belief that he would remain with Red Bull. team.

Sergio Perez, Red Bull Racing RB20

Photo: Red Bull Content Pool

In Abu Dhabi he said: “Nothing has modified since then when it comes to what I said all year long. I even have a contract for next 12 months and next 12 months I’ll drive for Red Bull. “

Red Bull also knew they couldn't just drop Perez on a whim – because the F1 Contract Recognition Commission would likely become involved if there was any breach of what had been signed.

This meant that an agreement would should be reached and that’s the reason Red Bull all the time wanted Perez to simply accept that a negotiated exit needed to be negotiated. Already in Qatar, Red Bull team principal Christian Horner said that Perez accepted that things weren’t going well.

“This is not a pleasant situation for Checo, who takes this position every week in the face of speculation,” he said. “He is old enough and wise enough to know what the situation is and let's see where we are after Abu Dhabi.”

When Red Bull shareholders agreed at a gathering in Dubai on Monday after the tip of the season that they might now not proceed with Perez, it became a matter of finally reaching an agreement.

As Horner revealed, when he and Perez sat down last week to debate various issues, they each agreed that their future wouldn’t be together.

Horner told Sky Sports F1: “He is [Perez] what was reflected within the postseason and last week we sat down and discussed what are the following steps? He has decided to take some time without work, essentially take a sabbatical from F1 and remain involved with the brand and team but step back from driving duties. It was sad to see him leave the band, but in fact it was time for him to also spend time along with his young family and take into consideration what he desired to do in the long run.

Christian Horner, Team Principal, Red Bull Racing, Sergio Perez, Red Bull Racing

Photo: Red Bull Content Pool

Ultimately, it was about crossing the t's and dotting the i's.

While F1 is a series through which obsession reaches hundredths of a second, on the subject of contracts, lawyers and managers, it moves at a much slower pace.

There will inevitably be disputes over clauses and wording, clarifications about what should and mustn’t be included within the negotiations, and naturally, a very powerful issue of all – the financial compensation package. That explains the delays in attending to where we finally got today. It is known this all took place as much as the eleventh hour before news of Perez's departure was finally made public.

The superb details of what was ultimately agreed upon between Perez and Red Bull are something that may only be known to them, however it is noteworthy that ultimately the primary confirmation of the tip of their relationship got here from Perez himself.

This was largely portrayed as Perez's own decision. The announcement read: “Message from Checo” and in a short time included a reference to a “separation agreement” reached between the driving force and the team. There is a superb line between jumping on yourself and being pushed: the tip result is similar, but the place to begin makes an enormous difference when lawyers become involved.

For Perez, the deal may leave him on the fringes of F1 for 2025, but at the least he can be paid decently as he considers his next steps in racing.

In the case of Red Bull, the ultimate termination of the contract could have involved some expenses, however the team hopes that what it needed to pay, in addition to the potential lack of sponsorship money incurred by Perez, can be compensated by a team with a greater likelihood of next 12 months's Constructors' Championship.