Volkswagen’s premium brands Audi and Porsche will join Formula One after persuading the German automaker that the move will generate more revenue than it costs, according to VW Chief Executive Herbert Diess.
The board of directors’ discussions on the two brands’ plans have resulted in some divides, according to Diess, who spoke at an event in Wolfsburg, Germany, where the German carmaker is located.
But, according to Diess, the brands, which, along with VW’s China business, are the group’s most important revenue generators, made the argument that a Formula One commitment would bring in more money for Wolfsburg than not having one.
“You’ve exhausted your arguments,” he explained.
For months, rumors have circulated that the two brands were in talks to form a cooperation to compete in the highest level of international motor racing, which has been dominated by Volkswagen’s German competitor Mercedes for much of the last decade.
Porsche’s preparations for entering Formula One, according to Diess, were a touch more substantial than Audi’s.
According to a source in March, Audi is ready to give roughly 500 million euros ($556.3 million) for British luxury sports automaker McLaren as a means of entry, while Porsche plans to form a long-term cooperation with racing team Red Bull starting in a few years.
Formula One’s tremendous advertising impact, in addition to the manufacturers’ economic argument, appeared to be convincing. As a result, according to Diess, Porsche will focus more on that circuit and minimize its other racing commitments.
The decision comes as Volkswagen prepares for a prospective listing of Porsche AG in the fourth quarter of this year, while sources say that a return to Formula One racing is unlikely to materialize for at least another several years.