Honda has announced its withdrawal from Formula One

Honda has announced its 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 on Friday 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 sub-prime 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.

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 withdraw again from the competition.

In 2000, Honda made yet another comeback by partnering with BAR, supplying engines and jointly developing the vehicle body. The company 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.

News source appreciated: livenews.com