The global financial crisis has hit one of the world's richest sports, motor racing, as the Japanese carmaker Honda today confirmed it would withdraw from formula one before the start of next season.
The move - a desperate attempt by the company to cut costs - shocked the motor racing world and all but ended Honda's long-held dream of claiming the formula one title.
The news came as global sales at BMW, the world's biggest premium carmaker, plunged by a quarter in November. Sales dropped to 96,570 units, led by a 26.2% drop at the flagship BMW brand.
The crisis facing the global car industry was underlined yesterday when executives from US automakers appeared in front of the senate banking committee to plead for up to $34bn (£23bn) in emergency government aid.
Car sales around the world have plummeted as consumers cut back on spending in the face of widespread job losses and a deepening recession.
In Germany, Europe's biggest car market, new car sales are expected to hit post-reunification lows this year and next before starting a slow recovery in 2010, the VDA auto industry association forecast this week.
Honda's formula one team employs more than 700 people in Brackley, Northamptonshire and its drivers last season included Britain's Jenson Button.
Honda's chief executive, Takeo Fukui, said he did not know when the firm would be in a position to return to the sport.
"This difficult decision has been made in light of the quickly deteriorating environment facing the global auto industry," he told reporters.
"Honda must protect its core business activities and secure the long term as widespread economic uncertainties continue to mount around the world."
Fukui, who once said he was prepared to invest "a trillion yen" to secure a championship title, said attempts would be made to find a buyer for the team before the start of the 2009 season.
"We will enter into consultation with the associates of the Honda racing team and its engine supplier Honda Racing Development regarding the future of the two companies. This will include offering the team for sale," he said.
Fukui said the firm had no plans to supply engines to other teams: "We do not want to be half in and half out of the sport."
Honda has come under mounting pressure from some shareholders to ditch its formula one team, which finished next to last in the constructors' standings last season and costs the firm an estimated $500m (£340.5m) a year.
Plummeting demand in the US forced Japan's second biggest carmaker to lower its sales outlook for the year through to the end of March. Yesterday, it announced it would trim its UK and Japan workforce.
Yesterday, the heads of the "big three" carmakers - General Motors, Chrysler and Ford - vowed to focus on cutting production costs and increasing fuel efficiency in return for aid.
The chief executives of GM and Chrysler indicated they would be willing to resume talks on a possible merger.
But their assurances were greeted with scepticism by committee members. "I don't trust the car companies' leadership," said Charles Schumer, a Democratic senator from New York, but he added: "We can't let the industry fail."
George Bush is reluctant to use part of the government's $700bn bailout package to support the industry, despite warnings that GM and its rivals face imminent collapse.
The president-elect, Barack Obama, said he supported measures to rescue the industry, but carmakers are concerned that his arrival in the White House in January will come too late.