Formula One: Cash-strapped Honda quits over financial crisis!


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melvin

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Formula One: Cash-strapped Honda quits over financial crisis
Posted: 05 December 2008 1319 hrs


TOKYO: Honda on Friday announced its shock withdrawal from Formula One over the global financial crisis, ending an involvement which began in the 1960s and raising further fears over the sport's future.

Honda Motor president Takeo Fukui made the announcement at an emotional press conference, repeatedly apologising to fans, staff, drivers and F1 authorities.

He said 2008 would be Honda's last season. The Japanese carmaker will not supply its engines to any other teams.

"This is a complete withdrawal. The future is a blank sheet," he said. "Five years from now, I think history will show we made the right decision."

"This difficult decision has been made in light of the quickly deteriorating operating environment facing the global auto industry, brought on by the subprime problem in the United States," Fukui said.

Japan's number two automaker will hold consultations with the team's staff and drivers about their future, including a possible sale.

Honda first competed in F1 in 1964 and has since clocked up three Grand Prix wins, including Jenson Button's in Hungary in 2006.

Its engines have also been behind dozens of victories by stars such as Nelson Piquet, Ayrton Senna and Alain Prost.

The team finished ninth in the constructors championship this season with 14 points. Veteran driver Rubens Barrichello achieved the team's best result with a third-place finish at Silverstone.

Honda Motor also supplied engines and other technical support to Formula One team Super Aguri, which called it quits due to financial problems in May.

Formula One events are also feeling the pinch with this year's Australian Grand Prix going US$27 million into the red and France axing its race over money worries.

Shanghai organisers recently cast doubt on the future of the Chinese Grand Prix but then retracted their remarks.

Max Mosley, the head of motorsport's world governing body, the FIA, has urged teams to come up with cost-cutting proposals in the face of the global financial downturn, which has hit automakers hard.

"It had become apparent, long before the present economic difficulties, that Formula One was unsustainable," Mosley said in October.

It is not the first time Honda has quit F1. It withdrew from the sport in 1968 to focus on developing compact passenger vehicles.

The Japanese firm returned to the F1 stage as an engine supplier from 1983 until 1992, when race regulation changes and a ban on the use of turbo systems prompted Honda to withdrew again from the competition.

In 2000, the Japanese firm made yet another comeback by partnering with BAR, supplying engines and jointly developing the vehicle body. Honda took full control of the team from the 2006 season.

Honda, like other Japanese automakers, is reducing production and cutting hundreds of jobs in response to slumping car sales.

"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," Fukui said.

Japanese manufacturers have expanded rapidly in recent years to meet brisk demand for their smaller, fuel-efficient cars, but they have not been immune to the financial crisis, even if they are in better shape than their US rivals.

- AFP/yb
Rubens Barrichello out of job!:(
 

seankyh

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yar I was quite disappointed. The last season was not that great for them. Wonder if there will be a new team now.
 

melvin

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yar I was quite disappointed. The last season was not that great for them. Wonder if there will be a new team now.
Last season midway Force India drop out now Honda! Hopefully have more new teams coming in!

:think: Subaru? Auddi?
 

melvin

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Honda put Formula One team up for sale

Honda have announced that it plans to sell its Formula One team after the Japanese car manufacturer’s decision to withdraw from the sport in light of difficult conditions in the global auto market.

The current Honda team was formed in 2000 after the company took over the former BAR squad, transforming it into a works team in 2006. Honda now hope to have new owners in place ahead of the 2009 season.

Team principal Ross Brawn and team CEO Nick Fry are expected to be closely involved in the evaluation of potential buyers, with speculation also arising that Brawn could call on contacts at his former team, Ferrari, to help secure a new engine supply deal.

Honda’s original Formula One involvement began in the 1960s, American Richie Ginther scoring their maiden win at the 1965 Mexico Grand Prix. Absent from competition in the ‘70s, they went on to several title successes as engine suppliers in the ‘80s and ‘90s with the likes of Williams and McLaren.

Their 2006 works return started well, with Jenson Button winning the Hungarian Grand Prix en route to fourth in the constructors’ championship. However, the team lost their way the following year, scoring just six points from 17 races.

Brawn’s subsequent arrival was heralded as the start of a new era, but came too late to have significant impact on Honda’s 2008 campaign, which saw them finish ninth in the final standings.

Neither of Honda’s race drivers, Jenson Button and Rubens Barrichello, has yet been confirmed for 2009 and the UK-based team recently evaluated GP2 star Bruno Senna.

Full statement from Honda:
“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.

"Thank you very much."

Takeo Fukui
President and CEO
Honda Motor Co., Ltd.

Any takers?:think:
 

#5
F1 is suffering from its own success... its becoming too rich and expensive to be part of. Money runs the show... all the decision are to push it to become the richest sport, most glamorous show... hopefully bernie and max will focus on what racing is all about... and not about how much TV money and sponsors its able to squeeze...
 

melvin

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Shummi picked the right time to leave before the storm begins heheh.....

I feel bad for Ruben.....
Ya sad man!... Ruben is quite a good driver, so is Jenson Button iirc this season Rubbens went to the podium once and he failed to scored a single pt in 2007. :sweat:
 

melvin

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All the big paycheck sportsmen get the sack....next will be those highly paid soccer player :think:
Soccer player sack :think: Maybe clubs will be sold!:bsmilie:
 

Benign

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#10
Belt tightening mah.... EPL next? If not, then some tv stations might cut down on international events. :bsmilie:

:cheers: for all the local sports: Sepak Takraw ? :bsmilie:
 

Big Kahuna

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#11
Belt tightening mah.... EPL next? If not, then some tv stations might cut down on international events. :bsmilie:

:cheers: for all the local sports: Sepak Takraw ? :bsmilie:
Starhub better lower the Sports channel fees loh....I am contempling to sack them soon because EPL gets boring nowaday....NBA I seldom watch liao.....F1 also neither here nor there....world cup? Many more years later lah...it's pay per view anyway :think:
 

sORe-EyEz

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#12
maybe next year's nite race oni have 1 car, & it will surely be the champ! :bsmilie:
 

afbug

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#13
Quite a stunner! In my opinion, Honda made a rash decision to go head to head with toyota after they entered F1. Honda could be better off as an engine supplier of B.A.R. After they bought out B.A.R, everything went downhill.
 

#14
Ya sad man!... Ruben is quite a good driver, so is Jenson Button iirc this season Rubbens went to the podium once and he failed to scored a single pt in 2007. :sweat:
He and Jenson are a case of great drivers...bad cars. If he was still with Ferrari...I would have done as well as Massa if not better I dare say. Massa was okay before he joined Ferrari. The car made all the difference for him to shine.
 

dreaming

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#16
while the sub-prime crisis, is slowly eating into the other sectors. first the Financial, followed by manufacturing, then retail, now sports!

do u think the football market will crash with the high salaried player. I suppose F1 is too expensive to maintain, and more viewer than gambler in F1 sport. unlike soccer, every sat night, u seem a horde of gambler at singapore pools betting on EPL, etc.
 

Gunbucker

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#17
do u think the football market will crash with the high salaried player.
The majority of people who contribute the most to the soccer industry, are the same type/grade/caliber of people who you see participating in queues at 4D/Toto outlets. Bad economies have never been known to deter these industries historically speaking.

But F1 on the other hand, isn't exactly the average bar fly sport. It's going to be tough for the grid. It's an extremely challenging balancing act. You have to maintain safety standards, regulate costs, and at the same time prevent it from becoming a processional snore fest.

Part of the excitement of the sport is to see big Auto names such as Ferrari, McLaren, Renault, BMW, etc crank out bitchin' engines, wickedly streamlined body designs, and innovative technology. With the single engine design rule, I'm not too sure how this will affect the sex appeal of the sport. It's looking more and more like A1 GP.

I'm reserving my judgment on these latest regulation tweaks, including the Olympics style medal scheme. We'll know in a short 3+ months!!! :thumbsup:
 

afbug

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#18
The chances of 9 time champions Williams F1 quitting is very high.....very high. No big budget manufacturer backing, no big sponsor back plus sponsers making big loses. The future looks bleak for them at the moment. Can't see them winning races and now survival is even a problem.
 

melvin

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#20
The chances of 9 time champions Williams F1 quitting is very high.....very high. No big budget manufacturer backing, no big sponsor back plus sponsers making big loses. The future looks bleak for them at the moment. Can't see them winning races and now survival is even a problem.
Heard from news yday that quite a few buyers interested in Honda maybe 1 or 2 of them can buy over Williams?:think:
 

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