Honda has decided to pull out of formula one at the end of the 2021 season, dealing a blow to the motor racing series as carmakers worldwide grapple with the rising costs to develop zero-emissions technology.
The decision casts a shadow over the future of f1, which is owned by us billionaire john malones liberty media investment group, as it will be left with just three engine suppliers in ferrari, mercedes and renault.
Japans third-largest carmaker, which supplies engines to red bull racing and scuderia alphatauri, withdrew from f1 in 2008 in the wake of the global financial crisis.
It returned in 2015 as a supplier to mclaren but hondas exit this time comes as the company is wrestling to stem two straight quarters of losses caused by a coronavirus dent to global car sales.
At a news conference on friday, takahiro hachigo, its chief executive, ruled out a return in the future, saying it had to shift its resources and engineers to building electric and fuel-cell vehicles. honda also does not plan to participate in formula e, the electric car racing series.
This is not about short-term revenue or coronavirus impact. its about where we want to focus our engineers for our long-term future, mr hachigo said.
The exit comes four years after mr hachigo set a target to generate about two-thirds of hondas global sales from electric vehicles, fuel-cell vehicles, hybrids and plug-ins by 2030. the company will also aim to achieve carbon neutrality by 2050.
Honda said its f1 engineers would be reallocated to developing new energy technologies to meet these targets. the group does not disclose the impact on earnings from its motorsport business, but the withdrawal will save some research and development costs.
In addition to pulling out of f1, honda recently agreed to seek a deeper tie-up in north america with general motors in a bid to save costs for developing self-driving and other future technologies.
From an environmental, social and governance perspective as well as in terms of sustainability development goals, participation in f1 does not reflect well these days, so if these pressures are behind hondas decision, there is probably no return in the future, said koji endo, head of equity research at sbi securities.
Last year, f1 said it planned to be net-zero carbon neutral by 2030, as the racing series targets sustainability. it already uses hybrid engines designed to reduce fuel use.
Christian horner, who leads the red bull team, said hondas move posed obvious challenges. the racing outfit will evaluate and find the most competitive power unit solution, he added.
Alphatauri team principal franz tost, who oversaw a rare victory for a team outside of mercedes, ferrari and red bull at this years italian grand prix, said the decision was unfortunate.
Zak brown, chief executive of mclaren racing, a uk-based team, added: i dont think many people should be totally surprised, given that honda was not prepared to commit beyond 2021 last year, but their departure will be a loss for f1. they are a great company and competitor.
F1 is gearing up for a change of management in january, when stefano domenicali, who heads lamborghini, will succeed chase carey as chief executive of the racing series.
Mr domenicali takes over after a tough year, in which f1, like other sports, has taken a substantial hit to revenues because its season was delayed as a result of the pandemic.
Mr carey, who replaced long-serving f1 boss bernie ecclestone after liberty medias $8bn takeover, is fresh from renegotiating the crucial deal that commits teams to the sport until at least 2025.
It is hoped that the concorde agreement, which sets out the way f1 shares revenues with teams, will reinvigorate the competition.
Daimlers mercedes is on course to win the constructors championship for a seventh consecutive year.