Formula E to introduce cost cap from 2022

The FIA Formula E World Championship will introduce a cost cap from 2022 to improve financial sustainability across the category.

The FIA World Motor Sport Council has ratified proposed financial regulations for Formula E that will come into place for Season 9, starting October 1 2022.

Two sets of regulations will come into place, separating manufacturers and teams, designed to increase financial sustainability and team competitiveness.

Spending for teams will be capped at €13 million ($20.5 million AUD) per season, to increase to €15 million ($23.6 million AUD) per season from Season 11.

The increase is to include the introduction of the Gen3 car.

Manufacturers will be limited to €25 million ($39.4 million AUD) over two consecutive seasons.

"Over the past 18 months, we have worked closely with the FIA and all participants in the ABB FIA Formula E World Championship to create a regulatory framework that will underpin the long-term financial sustainability for all participants in Formula E," said Jamie Reigle, Formula E CEO.

"When combined with recent enhancements to our technical regulations and sporting formats, this financial system will strengthen Formula E’s value proposition."

"In partnership with the FIA, we have created a framework which places long-term financial success at the core of the Championship which will support our existing teams and manufacturers while attracting new competitors and investment."

"The financial regulations are designed to complement our ambitious technical roadmap and enable manufacturers in Formula E to showcase the potential for electric vehicles in the most demanding racing conditions: the ABB FIA Formula E World Championship."

"The shift to electric vehicles is accelerating, Gen3 will set the standard for performance and efficiency. There is no turning back."