Honda Could Announce MotoGP Withdrawal On Friday

Honda's future in MotoGP has been an almost constant subject of debate since the announcement that the Japanese motoring giant was withdrawing from Formula One on December 5th this year. The situation was only made worse by American Honda's decision to withdraw from the AMA Superbike championship next year, announced exactly a week later. And now, it looks like there could be three "Black Fridays" in a row for Honda's involvement in racing.

For this Friday, December 19th, Honda CEO Takeo Fukui is due to deliver his end-of-year speech, and if reports from the Spanish press are to be believed, there is a real possibility that Fukui will announce the withdrawal of Honda from MotoGP. Both AS.com and Motociclismo.es have picked up a story by the weekly magazine Solo Moto, which quotes a spokesman from HRC as saying that "all of our projects are currently under consideration."

The problem, as you most likely guessed, is due to the global economic crisis. Honda's margins are under severe pressure, with sales slowing worldwide, a fact confirmed by a drop of nearly 27% in new car registrations in Western Europe. And as profits fall, Honda is coming under extreme pressure from investors to cut costs. Investors reacted positively to both Honda's F1 pullout, as well as their withdrawal from the AMA, despite the vast difference in budgets for the two activities, and Solo Moto believes that MotoGP is their next target.

Honda's MotoGP program does have a number of things stacked in its favor, however. Firstly, the MotoGP program costs about one tenth of the approximately $500 million Honda is believed to have spent on Formula One every year. Secondly, and more importantly, most of the tab for Honda's MotoGP budget is picked up by Repsol, the sponsor for the factory squad fielding Dani Pedrosa and Andrea Dovizioso. So pulling out of MotoGP would not produce much of an actual saving.

Worryingly, there are precedents in Honda's history. In February 1968, Mike Hailwood and Ralph Bryans flew to Japan to meet Michihiko Aika, then head of Honda's motorcycle racing department, expecting to test the new machinery for the upcoming season. But instead of testing, they found themselves being told that Honda had decided to withdraw from motorcycle racing, with no prior warning. It would take Honda another 15 years to win another Grand Prix Championship.

If Honda did pull out of MotoGP, it would have a devastating effect on the series. Honda currently provides 6 of the 19 bikes on the grid, and with FIM rules requiring a minimum of 15 entries for a world championship series, the prospects of the 2009 MotoGP season being run as a cup, with no world title at stake, do not bode well. The best case scenario - is it could be called such - would be that only the factory team would be disbanded, with Honda continuing to provide a bike to the satellite teams. This would leave two of MotoGP's brightest talents, Dani Pedrosa and Andrea Dovizioso out in the cold, and mean that the Honda RC212V would be unlikely to receive any further development for the rest of the season, making it an uncompetitive proposition.

Despite the fact that Solo Moto is a highly-respected publication, with what AS.com describes as "a direct line" into HRC, there is still no certainty as to what will happen. Honda UK has already announced that they will continue their support for the British Superbike series next year, and Motorcycle News is running an interview with LCR Honda's Lucio Cecchinello, in which the Italian states that he does not believe that Honda will pull out of MotoGP. But this has been a turbulent and troubled period, for all of motorsports, with both Suzuki and Subaru pulling out of the World Rally Championship. Right now, you'd have to say anything is possible, and only Takeo Fukui knows for sure. And he'll be telling us about it on Friday.

Comments

o.O

no words

Total votes: 61

GPOne disagrees

The Italian site seems not to be worried at all:

http://www.gpone.com/news/News.asp?NNews=3218

Total votes: 54

I'll give 100-1 Honda stays in motogp

In my opinion there is no way Honda will pull out of MotoGP. They were spending hundreds of millions getting their asses kicked in F1. The AMA has been in complete disarray for months, and is only barely starting to sort itself out. There isn't much downside to dropping out of those series.

MotoGP is a completely different animal. Honda is ALWAYS competitive, and is currently as well-positioned for a championship as it has been since Rossi jumped ship. Nevermind the political and PR fallout associated with completely tanking the series by dropping the numbers below those required to hold a world championship.

Not. Gonna. Happen.

Total votes: 57

WTF

I didn't buy that whole global financial crisis until it affected my fave past-time!
F1, MotoGP, WRC- hello peeps, do you expect me to go and watch the footy or something?

On a more serious note, I totally get why Honda left F1 because they were crap basically and it made no sense business-wise.
But as some others have also said, in MotoGP they are successful and they have main sponsorship , something the F1 team didn't have either! So we'll have to see what Japan decides. Anything can happen, I agree on that, but I think budget cuts are more likely.

Total votes: 47

Many layers to this.

Honda's departure from F1 made sense on a few levels, extreme cost probably being the first.  The Max & Bernie saga of constantly changing the rules and pushing the series towards a spec product has caused a few of the constructors to threaten to pull out of a proposed "spec F1" (an oxymoron at its core).  Since great sums have already been spent on the near future, there is no real recovery of Honda's expenditures.  So it follows that this was a political shot across the bow of the aimless ship FOM - now being the "ideal" time to cite cost cutting as motivation - and make it clear that at least one of the factories was not bluffing.

Since Honda is the only corporation participating in both GP series, they are obviously in a unique situation.  Though I can't really imagine that HRC is losing money in MotoGP, they can make threats unlike anyone else.   Some of us who think Honda already wields too much power in FIM and MSMA - and that Alberto Puig wields too much power inside HRC - may not like what results from this.  I am going to wear the cynical hat for this episode and think that this rumbling is a thrust for even more control.

With Carmelo reading from slightly dated scripts of Max & Bernie, I think we can see that Honda have had enough of this.   To what extent they will be speaking for the other manufacturers, I don't know, but I am fairly sure that they want to re-establish (or acquire more) control of the sport away from Dorna.  I'm inclined to support such a move, in some respects, as long as the rules don't keep changing in favor of Honda's smallest jockey.

Besides, how will they reconcile that the last World Champion piloting their bikes was Nicky Hayden? 

One would think there are only two options for scheduling a press conference like this:  1).  reaffirm commitment to the sport, or 2).  threaten to leave.  I hope it's #1.  I don't want them to quit.  But I think Mr. Ezpeleta is being put on notice (and, to me, this puts a little more context on his quotes from earlier this week).

Total votes: 62

No worries?

It sounds like this may have occurred already, and MotoGP was not mentioned in the cuts. I think we can all breathe now...

All that changed Dec. 17. Speaking at a hastily arranged press conference in Tokyo, Honda Chief Executive Officer Takeo Fukui, flanked by solemn-looking fellow executives, announced a huge downward revision in the company's earnings. Honda now says it will earn $2.1 billion this fiscal year, 62% less than it said just six weeks ago. Sales are now expected to plunge $4.5 billion, to $131 billion, 10.3% worse than previously expected. That means Honda expects to lose more than $2.1 billion in the six months through March 2009 after making $4.2 billion during the first half. "The situation is worsening every day in all regions," Fukui told a packed press conference at the company's Tokyo headquarters....

...To avert more red ink, Honda is undertaking a series of measures, most aimed at cutting costs. Among them, a new flagship plant in Yorii, outside Tokyo, and a minicar plant in western Japan will be delayed by at least one year, while planned capacity increases in India and Turkey have been postponed. Honda has dropped a plan to release the Acura luxury marque in Japan in 2010 and has axed the development of the successor to the NSX sports car, scheduled to have been equipped with a new V10 engine. And the company's plans to use diesel engines in larger models are now on hold. All new projects will be "reassessed from scratch," Fukui added. Earlier in December, Honda had already pulled out of Formula One in order to save the company about $500 million a year....

ref: http://www.businessweek.com/globalbiz/content/dec2008/gb20081217_013130.htm?

-jim

Total votes: 53

You're right Jim

It looks like you're right, Jim. I just posted another piece on the front page, discussing the announcements made during this press conference:

http://www.motogpmatters.com/news/2008/12/17/no_mention_of_motogp_in_hon...

Total votes: 48

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