Carmakers Reach Breakthrough on F1

Formula One carmakers represented by the GPWC association said on Thursday they have reached a breakthrough with the banks owning the racing circuit business regarding the future structure of Formula One.

The GPWC and the banks, comprising BayernLB, JP Morgan and Lehman Brothers, said they agreed to prepare a memorandum of understanding before the end of the year regarding the future structure.

The carmakers, including BMW, DaimlerChrysler, Ferrari, Ford and Renault, have long demanded greater control of Formula One and a larger share of the sport's future revenues.

Bernie Ecclestone, chief executive of FOA, also took part in the talks.

No details of the "breakthrough" were immediately available but it may bring to an end long standing efforts by the banks to reach agreement with car companies who had threatened to found their own racing series from 2008 if agreement was not reached by the end of this year.

The Formula One business used to be controlled by insolvent media mogul Leo Kirch. Bayern LB said that once a Formula One agreement was reached it envisaged no further financial effects from its involvement with Kirch.