Lewis Hamilton contract: Formula 1 salary caps could impact Mercedes negotiations

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A new driver salary cap is set to be introduced to Formula 1 which could speed up Lewis Hamilton's contract negotiations with Mercedes, or derail it entirely.

The terms, which would come into effect in 2023, have been approved by all of the current Formula 1 teams, according to GPFans.

Although yet to be confirmed, it is believed that teams would be allowed to pay their two drivers a combined salary of $30m.

The details of the proposed change were discussed earlier this week at the Formula 1 Commission video conference call, which featured representatives from all 10 teams.

However, the final terms have yet to be ratified by the World Motor Sport Council.

With the salary cap set to be announced in the near future, this could have major ramifications for Hamilton. The six-time Formula 1 champion reportedly earns $38m per year, meaning that if he were to agree a deal to stay at Mercedes beyond 2023 after the salary cap comes into play, he would be set for a considerable pay-cut.

If Hamilton signs a long-term deal before the salary cap is introduced, though, Mercedes would have to honour that contract and pay Hamilton his full salary.

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This latest development could also see the 35-year-old turn his back on the idea of a short-term contract extension.

Hamilton's current contract runs out at the end of this season, and only committing for a further year would see him facing the same problems with the salary cap 12 months down the line. 

Mercedes team principal Toto Wolff has previously stated that he hopes that is not the case.

“I think everything should be done this year. I don’t want to go into any other negotiation mid-year next year and drag it on again.

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“We all need to be concentrated on our job - Lewis driving, me running this team and Ola [Kállenius, Daimler chairman] turning the big wheel," he said.

Of course, there remains the slim possibility that Hamilton could walk away altogether when the season concludes in December.

That appears very unlikely, though, with the Brit currently in sparkling form and on track for a record-equalling seventh Formula 1 title.

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