Max Mosley stands down as F1 agrees a peace deal

The threat of a rival championship running alongside the FIA series next season has been averted after agreement was reached between the FIA, motor sport's world governing body, and the Formula One Teams Association, who had challenged the way Mosley ran the sport and demanded that his proposed £40million spending cap on all F1 teams for next season was scrapped.

Mosley had threatened to sue the rebels when they announced their rival series last week and as late as last night had suggested that he would stand for re-election as president unless they backed off. But this morning, a peace deal was thrashed out in Paris and Mosley confirmed he will officially stand down when his fourth term ends in October.

He also agreed to hand over control immediately to the FIA Senate president Michel Boeri, who will now work with FOTA to put together a united plan for the future. There was agreement reached on cost-cutting but the £40m budget cap proposed by Mosley has been scrapped and the rebel teams, Ferrari, McLaren, BMW Sauber, Renault, Toyota, Red Bull, Toro Rosso and Brawn GP, have been told they can retain total control of their own costs.
Confirming the compromise, Mosley said: "There will be no split. We have agreed to a reduction of costs.

"There will be one F1 championship but the objective is to get back to the spending levels of the early Nineties within two years." With regard to his own position, Mosley added: "I will not be up for re-election, now we have peace."

The agreement ends two months of wrangling since Mosley announced that a voluntary £40m budget cap would be imposed from next season. That prompted the eight teams to announce last week that they would run a rival series.

Following today's meeting, F1 supremo Bernie Ecclestone commented that he was "very happy commonsense has prevailed".

Mosley, 69, had announced yesterday in a letter written to all FIA member clubs he was prepared to stand again as president.

Mosley felt it vital to defend himself against what he saw was "unnecessary criticism" from "the dissident teams".

On the opposing side today was Luca di Montezemolo, the Ferrari president and FOTA chairman who has been Mosley's main critic.

Mosley had apparently made it clear if Di Montezemolo's approach was not antagonistic, then he would use the platform of today's meeting to confirm he would not run again for the presidency.