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TOKYO: Honda Motor withdrew from Formula One racing, cutting at least $ 216 million in costs after the carmaker slashed its earnings forecast, fired assembly workers and reduced production.

Japans second-largest automaker may put the Brackley, England-based team up for sale, President, Mr Takeo Fukui said on Friday. Honda would also no longer supply engines to other teams. Honda cut its profit forecast 13 per cent in October as the recessi on in the U.S. cripples car demand. Mr Max Mosley, president of F-1 ruling body the Federation Internationale de lAutomobile, has said the 1.6 billion dollar teams spend annually on the racing series is unsustainable.

Hondas withdrawal highlights just how awful situation surrounding the auto industry is, said an analyst at Credit Suisse in Tokyo. Other teams may follow, and the F-1 may not be held in the future.

Hondas vehicle sales in the U.S., the company's most profitable market, plunged 32 per cent in November, the most since 1981, as the economic slowdown and the weak consumer sentiment hurt demand for Civic models. - PTI

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