(CNN) -- Honda have confirmed they are pulling out of Formula One, unless a buyer for the team can be found by the end of the month, blaming the global financial crisis for their decision.
Jenson Button, left, and Rubens Barrichello could be out of a job following Honda's withdrawal from F1.
Chief executive Takeo Fukui announced at a news conference in Tokyo that the company would be willing to sell the team and will withdraw from the 2009 competition if no buyer is found by the end of Decemebr -- ending the Japanese car giant's nine-year involvement in the sport.
"We, Honda Motor Co Ltd, have come to the conclusion that we will withdraw from all Formula One activities, making 2008 the last season of our participation," said Fukui.
"This difficult decision has been made in light of the quickly deteriorating operating environment facing the global auto industry, brought on by the sub-prime problem in the United States, the deepening credit crisis and the sudden contraction of the world economies.
"Honda must protect its core business activities and secure the long term as widespread uncertainties in the economies around the globe continue to mount. A recovery is expected to take some time," he added.
It is understood the 600 members of staff at Brackley, near the Silverstone circuit in England, were told job losses would be likely, even if a buyer was found for the team.
The news also leaves drivers Jenson Button and Rubens Barrichello facing an uncertain future, with spare places in rival teams few and far between.
Honda's demise would also reduce the F1 grid to just 18 cars (nine teams) and would see them become the second team to fold this year following Super Aguri's closure early in the season.
Despite a huge operational budget of $300 million, Honda have under-achieved in the sport, finishing ninth out of 10 in the constructors' standings with Barrichello 14th and Button 18th out of the 20 drivers.
Honda Motor Corporation are dealing with faltering sales worldwide and the Formula One team is not the only casualty.
On Thursday, 490 temporary employees were told they would be laid off at the end of January, while last month 270 temporary employees were informed their contracts were not being renewed.
Max Mosley, president of Formula One's governing body, the FIA, said Honda's withdrawal had confirmed his "longstanding concern that the cost of competing in the world championship is unsustainable." Read more about Mosley's past warnings
Mosley sent a letter to the remaining teams urging them to accept cost-cutting moves including smaller, more fuel-efficient engines, which he estimated would shave up to $60 million off the expense of running a team beginning in the 2010 season.
"In the FIA's view, the global economic downturn has only exacerbated an already critical situation," Mosley said.
"What has happened to Honda is very sad because obviously it involves a lot of jobs and they are a key player in Formula One, but I have to say it was not entirely unexpected," he added.
"I've been expecting one of the major manufacturers to stop for some time because even before the current situation the costs were completely out of control. Now it's difficult to imagine how any manufacturer could stay in the sport unless we make really substantial reductions in costs."
Meanwhile, Honda team principal Ross Brawn remains confident a suitable new owner could still be found.
The former Ferrari technical director told BBC Radio Five Live: "It's a fantastic opportunity for someone to step into what will be a very competitive team next year.
"The facilities here are one of the best in Formula One, the workforce is definitely one of the best in Formula One and we have got a great car design for next year.
"I think it would be unfortunate for Formula One if this had a domino effect on other teams. I hope that doesn't happen but all the teams are having to face up to this economic environment.
"Formula One unfortunately has a certain inertia and it is difficult to change things quickly because of the regulations. If a car factory gets into difficulty it can close down for a few months, stop production. We can't do that. We have races to go to and schedules to meet.
"It is very difficult to turn the tap off in Formula One overnight but I think the things that are being done now can really make a difference next year and in 2010."