Mercedes–AMG Petronas Formula 1 Team CEO Toto Wolff had minimal involvement in his organisation’s contribution to the Ineos Team UK Challenge for the 36th America’s Cup.

That was until he he watched footage of the British AC75 struggling to get airborne during the Christmas Cup regatta in New Zealand last December.

Although on holiday with his family, the agonising plight of Ben Ainslie and his crew out on Auckland’s Hauraki Gulf caught Wolff’s full attention.

“The boat wouldn’t go out of the water properly – and it was really annoying to see that,” he recalls.

When Mercedes engineers got involved in troubleshooting the sailing team’s problems during a break in the racing over the Christmas period, their input triggered a remarkable transformation of the British team’s performance.

When their boat came out of the shed in the new year it was firing on all four cylinders and capable of stable flight. Ainslie’s men suddenly found they could execute complex manoeuvres with panache and began immediately to win races.

The reinvigorated team dominated the round robin sections of the challenger selection series to secure the automatic spot the Prada Cup final series, although they ultimately lost out to the superior performance of the Italian Luna Rossa Prada Pirelli AC75.

“When our team got involved in the troubleshooting, we applied the same kind of tools and processes that we would deploy if we had an aerodynamic problem [in Formula 1],” Wolff explained.

“I think it's never down to one factor, but in the end, it helped to lift the boat out of the water – maybe not quick enough to win the Cup, but much better, not embarrassing anyone.”

Now the Mercedes Formula 1 team – which Wolff owns one third of along with Daimler AMG and Ineos Britannia owner Jim Ratcliffe – will be dramatically more involved in Ainslie’s third attempt to win the America’s Cup.

Last week Wolff was front and centre at the announcement that Ineos Britannia – the British America’s Cup Challenge led by Ainslie and owned by Ratcliffe as part of his Ineos Sport initiative (which also includes topflight sports teams across football (soccer), cycling, and running) – would be a joint venture with the highly successful Mercedes Formula 1 team.

Although only just announced, the relationship has been in place for several months now and the campaign is fully up and running. Wolff said the team’s Applied Science division in Brackley, England will soon have around 50 people working on the Ineos Britannia AC37 project.

“We are slowly ramping it up,” he said. “But it is less a question of the sheer amount of resource and more about [asking] where can you deploy intellectual property and know-how from Formula 1 into sailing.”

Formula 1 is universally recognised as the benchmark of sporting professionalism, innovation, and technical excellence. It is easy, therefore, to see what Ainslie’s sailing team will gain from the relationship. According to Wolff, there are benefits to be had too for the Formula 1 team from applying itself to the quest to win sailing’s most technologically advanced and expensive prize.

“It doesn't get any bigger than then the challenge of winning the America's Cup as the Challenger of Record.”

Wolff said he saw the America’s Cup competition as ‘the most challenging of all racing, the pinnacle, comparable with Formula 1’, but added that the allocation of resources to the Cup project from the team’s Applied Sciences division ‘is not in the pursuit of margin’.

“It is more in the pursuit of learning [and] of diversification for the benefit of Formula One,” he explained.

“We want to work with people that want to break records or win championships on land, sea, air, and space. It’s a great new project for engineers who have earned their laurels in Formula 1 but [now] want to look at something different.”

It’s worth noting at this point that the Applied Science division was created as a way of retaining the Formula 1 team’s existing staff and resources which they are unable to utilise due to the $140 million budget cap imposed on Formula 1 teams this season.

The cap will be decreased by a further five million dollars over each of the next two seasons. What better way to keep those multiple race winning designers and other expert staff engaged than a fresh new a d exciting challenge like the America’s Cup?

“The benefit is we retain the capability in house, [without the risk of it] going elsewhere within the industry or outside,” Wolff commented.

“We have had situations where engineers said: ‘We've done seven years and [won] seven world championships. Where's the next challenge?’.

“Well, it doesn't get any bigger than then the challenge of winning the America's Cup as the Challenger of Record. You are the underdog – being anything else than the Defender and you are the underdog – so you need to do an even better job. People throughout the departments have said: ‘This is a nice challenge which we would like to take up for the next three or four years.”

Wolff firmly believes there will be learnings along the way from the America’s Cup design process that can be deployed in Formula One.

“We are often too narrow minded in our little microcosmos,” he said. “When I started to read the rulebook of America's Cup and looked at the commercial background, it was like being back at school. It's an activity that is so competitive that you need all your cognitive and intellectual concentration. It takes you out of your comfort zone and that becomes an advantage for Formula 1.”

“We want to work with people that want to break records or win championships on land, sea, air, and space.”

Other Formula 1 teams – like Red Bull Racing and Aston Martin – are reported to be following suit with their own version of the Mercedes Applied Science division. Red Bull Racing is rumoured to have partnered with the yet to be announced America’s Cup Challenge from the two-time AC winning Swiss syndicate Alinghi.

From Wolff’s standpoint these moves are a logical progression for Formula 1 teams given the sport’s current landscape.

“I'm always keen to learn from other sports leagues,” he said. “The most developed American sports leagues, the NBA and the NFL, have diversified – into real estate, into the hospitality business (by the sheer fact that they have in a stadium). I think for us, the logical next step is diversifying into engineering.

“We've created all this IP [intellectual property] that we have never deployed on any other vehicle than a racing car. We have never monetized any of the IP that exists here – and you're talking of billions of spend on technology in Formula 1. So that's why it sounds pretty logical that other teams are looking at that space.”

Presented this way the Ineos Britannia America’s Cup partnership seems like a true win-win scenario for the sailing and motorsport teams.

However, Wolff does sound a word of caution that the yachting side project must not be allowed to distract the Mercedes organisation from its primary goal of continuing to dominate in Formula 1.

“We need to make sure that we are a contributing partner with the same ambition than we have in Formula 1 racing, but without distracting any of the two activities.,” he said.

“We don't want to read the headline in three years that since we started sailing, we haven't been winning on the road that much.”

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