Honda pulls out of Formula 1

by Daniel Farey-Jones, Brand Republic 05-Dec-08, 09:10

LONDON - Honda has been forced to pull out of Formula 1 due to slumping car sales, sending a shockwave through the sport.

The Japanese manufacturer has been involved with Formula 1 for around 40 years and set up its own Honda Racing F1 team in 2006.

It was the highest spending team last season with a budget of £148m, which was not covered by sponsorship deals, but scored only 14 points from 18 races.

Instead of featuring sponsors, Honda decked out its cars in an 'Earth Dreams' livery highlighting its efforts and ambition to be a more environmentally sensitive car manufacturer.

In pulling out, Honda is attempting to sell the team it set up, which employs around 700 people.

However, it will disband the team if it cannot find a buyer in the next three months.

Honda's decision leaves the sport reeling as the other teams work out their priorities ahead of the 2009 season, which starts in March.

There are concerns about Toyota's commitment after it elected not to hold a big launch event for its 2009 car in a bid to save money, though the manufacturer said yesterday it had not changed its plans to participate next season.

The move follows opposition to cost-cutting proposals from Max Mosley, the president of the Federation Internationale de l'Automobile, Formula 1's governing body.

Ferrari and Toyota are against the proposals, which call for a cap on team budgets and the introduction of standard engines, but that opposition may dampen in the wake of Honda's pull out.