A group of Europe’s biggest auto manufacturers yesterday announced they would compete with Formula One motor racing by setting up a championship of their own.

The coalition of auto firms, which between them invest over $1 billion in Formula One every year, represents over half the cars on the F1 race grid – DaimlerChrysler (McLaren), BMW (Williams), Fiat (Ferrari), Ford (Jaguar) and Renault (Benetton).

The announcement is the latest move in the car companies’ stand-off with media group Kirch Gruppe and its partner EMTV. Between them, the media duo hold 75% of SLEC, the foundation controlling the broadcast rights to the sport [WAMN: 28-Feb-01].

Talks between the two parties have reportedly broken down – the auto manufacturers do not trust Kirch’s promises that Formula One coverage will be extended beyond pay-TV platforms and are unhappy that the SLEC shares were sold without their being consulted.

“As a result of recent developments and in the best interests of motor sport, it has been unanimously agreed to set up a joint company, the purpose of which will be to establish, as soon as possible, a new open-wheel single-seat racing car series,” announced Fiat chairman Paolo Cantarella.

The car manufacturers announced that they plan to set up the new championship in 2008, a year after the conclusion of the current agreement regulating financial dealings between SLEC, the teams and governing body the Fédération Internationale de l’Automobile.

Kirch responded by calling the announcement a negotiating ploy and denied that discussions had been abandoned: “We do not see the talks as broken. The position has hardened but building up a new Formula One would mean a great deal of efforts for the carmakers and for [Bernie] Ecclestone [racing promoter and SLEC shareholder],” said the company.

News source: Financial Times