FIA president Jean Todt is in favour of lowering F1's budget cap ceiling, but insists more cutbacks still won't allow small teams to compete on an equal level with the sport's big guns.
Formula 1, the governing body and the teams will meet again this week to consider more changes to next year's budget cap which was recently lowered from $175m to $150m.
While Ferrari and Red Bull are against any further reductions, the smaller outfits are seeking compromise around the $130m level, although several outfits are lobbying for an extreme push down to $100m.
The disruption caused by the coronavirus pandemic and the uncertainty surrounding its evolution has forced F1 to mitigate as much as possible the impact of the crisis.
Todt is confident that next year's cost cap level - regardless of where it will be set - will serve the sport's interests. But the Frenchman isn't dismissing more changes in the future if irreversible damage is inflicted on F1's weakest members.
"The only scenario that would require an adjustment after that [final meeting] would be the loss of some teams, which we cannot rule out," he told Auto Motor und Sport.
"I hope that we do not get into this situation. Then we would have to ask ourselves fundamental questions with the commercial rights holder, such as what should Formula 1 look like in the future?
"In the worst-case scenario, Formula 1 as we know it today would no longer be possible."
For years F1's midfield has struggled to reduce the performance gap - let alone close it - with the sport's top three teams. While many hope that lowering the budget cap limit will provide equal opportunity, Todt believes such a scenario will remain a pipe dream.
"I understand this position, but I do not believe in miracles," he added.
"The differences between the big and smaller teams must be narrowed, but we must not start to dream. It will never be the case that a small team can compete regularly against a large team on an equal footing.
"We must not lie to ourselves. If we are talking about 120, 130 or 140 million dollars, that is the cost cap without exceptions, for the big teams, the exemptions make up more than 100 percent of the cost cap.
"Now, when the budget cap is reduced, they have even expressed the wish to extend the exemptions. But I am against it."
Is there any budget cap level at which the FIA president can foresee teams standing on equal footing?
"We can only come up with a reasonable number if we forget today's Formula 1 and start with a blank sheet of paper," he said.
"With a cost cap of $ 50 million without exceptions, nothing would be the way it is.
"It would be a completely new Formula 1. A Super Formula 2. But as Formula 1 is currently structured, a fresh start is not possible. We would lose too many teams, including the big ones."
Gallery: The beautiful wives and girlfriends of F1 drivers
Keep up to date with all the F1 news via Facebook and Twitter
