As predicted as the budget cap row escalates, Ferrari’s Board of Directors, chaired by Luca di Montezemolo, has confirmed that the Italian company won’t be competing in Formula 1 next year. The announcement comes following the FIA’s decision to introduce two different sets of regulations based on arbitrary technical rules and economic parameters.

Ferrari considers that if this ‘two-tier’ system for Formula 1 remains, then the company’s uninterrupted participation in the sport over the last 60 years – the only constructor to have taken part ever since its inception in 1950 – would come to a close.

Ferrari has also expressed its disappointment about the methods adopted by the FIA in taking decisions of such a serious nature and its refusal to effectively reach an understanding with constructors and teams.

Today’s announcement follows those of Toyota, Red Bull and BMW, amid rumors that other teams will also shortly follow suit. It is expected that only Brawn, Williams and Force India will meet the FIA's May 29 deadline to lodge official entries for next year's world championship.

Max Mosley, FIA president, said just over a week ago that F1 could live without Ferrari, even though the Italian team is the only team to have been in the sport every single year since the league's founding in 1950.