Cadillac will pay each of their 10 F1 rivals a huge sum as part of a pre-arranged agreement after confirming their 2026 driver line-up.
The American team, which is backed by General Motors and Andretti, announced on Tuesday that Valtteri Bottas and Sergio Perez will drive for them in their inaugural season.
Both drivers have been out of F1 this season after their departures from Sauber and Red Bull respectively at the end of 2024.
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Cadillac have opted for experience in their line-up, with Bottas and Perez having had 514 Grand Prix starts between them.
Their main objective for the 2026 season will be to avoid finishing bottom of the 11-team Constructors' Championship.
Currently, prize money is paid out as a percentage of around 50 per cent of F1's commercial revenue.
Last year, BBC reported that the estimated prize pot was $1 billion for the 10 teams, with champions McLaren taking home $140 million.
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Naturally, the addition of an 11th team means the prize money on offer for each team will be reduced from next season onwards.
The exact amounts have not been specified, with the 11 F1 teams having signed a new Concorde Agreement - which governs major aspects of the sport - that comes into effect on January 1, 2026.
The existing agreement, which expires at the end of 2025, stipulates that a new entrant must pay a total fee of $200 million in order to compete in F1.
That fee is then evenly distributed among the other 10 teams - a sum of $20 million each - as 'compensation' for the change in distribution of prize money.
What is the F1 Concorde Agreement?
The Concorde Agreement is signed by all F1 teams, the FIA and the Formula One Group, and usually lasts for five seasons before an updated version is agreed.
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It stipulates how television revenue and prize money is distributed between all teams competing in F1, and details the rules which are in place across each race weekend.
The agreements are usually signed without major issue - though the FIA are yet to sign off on next year's agreement - but a dispute in 2008 threatened the entire existence of F1.
In July of that year, the 10 teams racing at the time formed the Formula One Teams Association (FOTA), which would negotiate directly with the FIA.
The two parties agreed to cost-cutting measures in December, but the World Motor Sport Council (WMSC) subsequently announced changes to the technical and budget cap regulations for 2010 that several of the teams opposed.
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Toyota, Ferrari, Red Bull and Renault claimed the new regulations would create a 'two-tier budget cap system' and stated that they would not enter the 2010 championship if the matter was not resolved.
FOTA - minus Williams and Force India, who agreed to unconditionally enter the F1 championship for 2010 - announced in June 2009 that they would form a breakaway series for 2010 amid a continued row over the budget cap.
Fortunately, six days later, an agreement was reached between FIA and FOTA to avoid a breakaway championship and finalise the Concorde Agreement rules for 2010.
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FIA president Max Mosley, who described the breakaway teams as 'loonies' in an interview with BBC's Jake Humphrey, was effectively forced to step down from his role following the negotiations.
Ryan Smart