MAY 12, 1997

Audi and Formula 1

RUMORS in recent days linking Audi with Benetton suggest that the German manufacturer is looking very closely at buying into Grand Prix racing. It remains to be seen whether there is any truth in the stories but it is quite likely that Benetton has approached the German carmaker in the hope that it will help out.

Audi is the luxury brand of the Volkswagen Group - Europe's largest car maker. Audi grew out of the old AutoUnion company and so has a long and illustrious history in pre-war racing with its Silver Arrows. It is, however, making big inroads in the luxury sectors of the world's car markets and is beginning to challenge both BMW and Mercedes.

For the last couple of years Audi has been very profitable and there have been several feasibility studies of F1. A Grand Prix engine was designed by Audi in July 1991 and there were talks with McLaren at the end of the following year when the team was looking for a replacement for Honda. Two years later there were talks with Cosworth about a possible engine project.

The man pushing for an F1 project is Audi's chairman Ferdinand Piech, grandson of the founder of Porsche, who was involved in Porsche motor sport programs - notably in sportscar racing - as an engineer in the mid-1960s working on the Carrera 6, 910, 907, 908 and ultimately the 917 programs. He moved to Audi in 1972 and masterminded a successful rally and touring car programs with the Audi Quattro.

The problem for Audi has always been justifying the costs of an F1 program but with major profits and big ambitions, it is quite possible that Piech will finally get his way.

It remains to be seen whether or not Audi wants to buy into an F1 team. In the current financial climate this would be a good idea as owning an F1 team will soon become a profitable business as Bernie Ecclestone's TV revenues increase.

Audi will also be wary of Mercedes-Benz's experiences with McLaren and will probably want to have a shareholding in any team so that there can be a level of control.