F1 rocked by global recession

“Byeeeeee!”

Holy KERS, Batman! Who saw this coming? Not us, or anyone else judging by the shocked reaction in the media. Max Mosley feared that something like this might happen, but most of us believed - naively, maybe - that F1 could continue to exist in its current state, albeit with a few cost cuts here and there.

Yesterday we told you that Honda had scrapped its annual media lunch. Who knew that the manufacturer had secretly decided to scrap rather more than a seven-course Christmas meal.

Honda’s Nick Fry claims three parties have already been in touch about buying out Honda, and there is every chance the team will run in some form next season, albeit on a greatly reduced budget - but hundreds of staff at Honda’s Brackley HQ will still lose their jobs. And if a giant like Honda can’t survive, you have to wonder if Toyota - Honda’s direct rival in F1 and in the production market - will also pull the plug, perhaps remaining in F1 only as an engine supplier.

So, dark days for F1. And with car sales plummeting around the world, the sport is more vulnerable than at any time in its history.

More on the F1 crisis throughout the day.

Read Honda’s full statement below:

Honda’s statement in full:

“We, Honda Motor Co., Ltd., have come to the conclusion that we will withdraw from all Formula One activities, making 2008 the last season of participation.

This difficult decision has been made in light of the quickly deteriorating operating environment facing the global auto industry, brought on by the sub-prime problem in the United States, the deepening credit crisis and the sudden contraction of the world economies.

Honda must protect its core business activities and secure the long term as widespread uncertainties in the economies around the globe continue to mount. A recovery is expected to take some time.

Under these circumstances, Honda has taken swift and flexible measures to counter this sudden and expansive weakening of the marketplace in all business areas. However, in recognition of the need to optimize the allocation of management resources, including investment regarding the future, we have decided to withdraw from Formula One participation.

We will enter into consultation with the associates of Honda Racing F1 Team and its engine supplier Honda Racing Development regarding the future of the two companies. This will include offering the team for sale.

In its third era of Formula One activities, Honda has been participating in Formula One races from the 2000 season, initially with BAR, by adopting a new format of jointly developing racing machines. Subsequently, in a move to meet the changing environment surrounding Formula One, we switched to running a 100 percent Honda-owned team commencing with the 2006 season.

Surmounting many challenges, the Honda Team achieved a Grand Prix victory in 2006, enabling Honda to receive overwhelming support from Honda fans around the world that were looking forward to greater success. It, therefore, has been an extremely difficult decision for us to come to this conclusion without having been able to fully meet the expectations of our fans.

By making the best of what we have learned during these times of economic turmoil, coupled with the spirit of challenge gained through active participation in racing, we intend to continue with our commitment in meeting new challenges.

Finally, we would like to take this opportunity to sincerely thank our fans and all those who have supported Honda’s Formula One efforts, including everyone in the world of Formula One.”