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Audi, Porsche joins Formula 1, says VW CEO

BERLIN, May 2 (Reuters) – Volkswagen’s (VOWG_p.DE) premium brands Audi and Porsche join Formula 1 after convincing the German carmaker that the move will bring in more money than it will cost, VW said. chef Herbert Diess Monday.

Discussions in the board about the two brands’ plans had created some divisions, Diess said at an event in Wolfsburg, where the German carmaker is headquartered.

But in the end, the brands, which alongside VW’s China business are the group’s main revenue suppliers, made the case that they would pull more money into Wolfsburg with a Formula 1 commitment than without one, according to Diess.

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“You’re just running out of arguments,” he said.

There has been speculation for several months that the two brands are negotiating partnerships to enter the highest class of international motor racing, which for much of the last decade has been dominated by Volkswagen’s German rival Mercedes (MBGn.DE).

Diess said Monday that Porsche’s preparations to enter the Fomula One were a little more concrete than Audi’s.

Audi is ready to offer around 500 million euros ($ 556.3 million) for the British luxury sports car manufacturer McLaren as a means of getting in, a source told Reuters in March, while Porsche intends to establish a long-term partnership with the racing team Red Bull that starts for several years. Read more

In addition to the brands’ economic argument, Formula 1’s high advertising impact was apparently also convincing. Diess said that as a result, Porsche will reduce other racing activities and concentrate more on that circuit.

The decision comes as Volkswagen prepares for a possible listing of Porsche AG in the fourth quarter of this year, although sources have said that entry into the Formula 1 race is unlikely to happen until a few years from now. Read more

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Reporting by Jan Schwartz; Writing by Miranda Murray; Edited by Paul Carrel, Jane Merriman and Jan Harvey

Our standards: Thomson Reuters Trust Principles.

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