Global crisis ends Honda F1 era

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Honda is pulling out of Formula One, blaming the world economic crisis for plans to sell its team.

Sources told BBC Sport the team were "optimistic" they would continue, but an investor had not yet been found.

The decision leaves Englishman Jenson Button and 2009 team-mate Rubens Barrichello without drives, with only a few mid-ranking seats still available.

Honda, which spent more than £300m a year on F1, said it would also no longer supply the sport with engines.

A deadline of January has been set to find a buyer but workers at Honda's Brackley base have been told to expect redundancy letters before Christmas.

"Honda Motor Co. has come to the conclusion that we will withdraw from all Formula One activities, making 2008 the last season for participation," said Honda president Takeo Fukui at an emotional press conference.

"This difficult decision has been made in light of the quickly deteriorating operating environment facing the global auto industry... and the sudden contraction of the world economies," he added.

"Honda must protect its core business activities and secure the long term as widespread uncertainties in the economics around the globe continue to mount."

According to the Reuters news agency, team bosses Ross Brawn and Nick Fry told a meeting of the Formula One Teams' Association: "They have a month to find a buyer, otherwise they are closing the team."

If no buyer is found, Honda's decision will leave F1 with just 18 cars on the grid next season.

Honda said next year's Japanese Grand Prix at its Suzuka circuit would go ahead as planned.

Honda appointed Brawn, the man who masterminded seven world titles for Michael Schumacher at Benetton and Ferrari, as their team principal prior to the start of the 2008 season.

His arrival was seen as the signal for the start of a concerted push for success by the company after several seasons as also-rans.

The company returned to F1 as a team owner and car builder in 2005, having spent five years as an engine supplier to the British American Racing team.

But they have struggled to make an impact at the top levels of the sport.

Their sole victory of the modern era came with Button's win at the Hungarian Grand Prix in 2006.

But they have been uncompetitive in the last two seasons.

Honda's decision could also spell the end of Barrichello's 16-year F1 career.

The 36-year-old winner of nine Grands Prix was competing with his novice compatriot Bruno Senna, the nephew of F1 legend Ayrton Senna, for a seat at Honda in 2009.

Honda recently cut road vehicle production as a response to the global economic crisis - the company's sales in its key US market were down 30% last month.

F1 is a notoriously expensive sport in which to compete, and teams have spent recent months in intensive discussions over cost-cutting measures.

Max Mosley, president of world motorsport governing body the FIA, recently urged teams to find ways to reduce costs.

In an exclusive interview with the BBC, Mosley described Honda's withdrawal as a significant warning to the rest of the teams to start cutting costs dramatically.

Mosley wants to make drastic changes for the 2010 season - including making a standard engine and gearbox available to all teams at a projected cost of 5m Euro (£4.4m) per team.

The idea is opposed by the road-car constructors still in F1, who are proposing a new engine formula of their own.

Considered a major player within F1, Honda bankrolled more than 800 staff at the team's Northamptonshire base and had one of the largest budgets in the sport.

"I am told that for £1 you can now buy the Honda F1 team," said BBC sports news correspondent Adam Parsons