Audi Delays Second Engine Upgrade Until 2027 Due to Budget Cap

Audi has a spare engine upgrade token burning a hole in its pocket, and it has absolutely no intention of spending it this year. Allan McNish confirmed after the Hungarian Grand Prix that the team’s second ADUO power unit upgrade is being pushed back to 2027, and the reason is refreshingly blunt: money.

The Token They Won’t Touch

Under Formula 1’s Additional Development and Upgrade Opportunities system, Audi was awarded two upgrade tokens after the first ADUO checkpoint following Monaco. The FIA’s benchmarking determined Audi’s ICE was at least four per cent down on the Red Bull Powertrains benchmark, which tells you everything you need to know about where the German manufacturer currently sits in the engine hierarchy.

One token was spent at the Spanish Grand Prix in Barcelona, targeting driveability rather than raw performance. Gabriel Bortoleto and Nico Hulkenberg had been struggling off the line, and that update helped smooth things out. The second token, however, is staying firmly in the drawer.

“Everybody has got this trade-off between when you’re bringing upgrades, chassis and PU, and also where you spend your money. You can’t spend everything at one time, because then you don’t have anything to fight with later. So it’s got to be a managed expectation, not just over one season, but multiple seasons as well.” – Allan McNish

The Budget Cap Bites Again

Power unit manufacturers operate under a $100 million budget cap for 2026, and McNish is making no attempt to dress up the decision as anything other than financial pragmatism. This is not visionary long-termism. This is an organisation managing its chequebook carefully because hardware upgrades are expensive and irreversible.

As McNish put it plainly: the bigger parts are for 2027, and nothing significant will arrive on the power unit side before then. The 2026 regulations already brought sweeping changes, scrapping the MGU-H and boosting electrical output to 350 kW, so there is at least a logical case for a major architecture rethink taking time. Still, admitting your engine is a second a lap down on the front runners, as Mattia Binotto has previously suggested, is not exactly a ringing endorsement of progress. For more context on where the top teams stand, see our piece on Hamilton’s warning about Ferrari’s second-half power unit push.

Encouragement in the Midfield

To be fair to Audi, the recent trajectory is genuinely positive. Three consecutive points-scoring races, a jump past Williams in the constructors’ standings, and consistent Q3 appearances suggest the chassis package is doing its job. After seven races without a single point, that matters.

McNish sounded appropriately measured when reflecting on where the team stands: comfortable rather than triumphant, aware the gap to the top four remains enormous, but encouraged by an upward trend after just 11 Grands Prix as a full factory entry.

Patience, Or Necessity?

Audi will tell you this is all part of a carefully managed multi-season plan. And perhaps it is. But when the budget cap is explicitly cited as the reason you cannot deploy an upgrade you are already entitled to, the narrative writes itself. This is not patience. This is a manufacturer learning, the expensive way, that arriving in Formula 1 without deep financial reserves is a humbling experience. The 2027 power unit had better be worth the wait.

Greg Ashford

Greg Ashford fell in love with F1 during the Häkkinen-Schumacher battles and has been watching the sport's slow descent into corporate theatre ever since. After years of playing nice in the paddock, Greg decided someone needs to say what everyone's thinking. He's not here to make friends with team principals or parrot press releases, he's here to tell you what's actually going on. No filter, no bullshit.