Audi will manufacture its own power unit in an era when there will be a greater emphasis on sustainable fuels and an increased electrical component in engines.
German car manufacturer Audi will become an engine supplier in Formula One for the first time in the 2026 season, chairperson Markus Duesmann has announced.
Audi will announce the team they will supply by the end of the year although it is widely expected to be Sauber, who presently race as Alfa Romeo with a Ferrari engine.
Those expectations moved closer to reality when Alfa Romeo announced in a statement on Friday they would cut ties with Sauber "at the end of 2023".
The Audi announcement was made at Spa Francorchamps, the venue for Sunday's Belgian Grand Prix with Formula 1 President and CEO Stefano Domenicali and Mohammed ben Sulayem, President of the International Automobile Federation (FIA), motorsport's governing body present.
"Formula 1 is both a global stage for our brand and a highly challenging development laboratory," Duesmann said in a statement.
The engine will be developed at Audi Sport's facility in Neuburg near Ingolstadt with the company heralding the fact it will be "the first time in more than a decade that a Formula 1 power train will be built in Germany."
'Two separate programmes'
Adam Baker, who before joining Audi in 2021 worked for FIA for three years, will take over the management of the company and the Formula 1 project as CEO.
Audi added in the statement that Formula One's stated goals to become more sustainable attracted them.
Their decision comes shortly after it was agreed at FIA's World Motor Sport Council new engines, or power units (PU), would be required in Formula 1 by 2026, aimed at greater sustainability.
The new motors will increase electrical power by up to 50% and use 100% sustainable fuel.
"Globally recognised, highly emotional, and technologically advanced — that's how Formula 1 has met Audi's exact requirements," read the statement.
"The key to getting involved is the world's most popular racing series is the clear plan to become more sustainable and cost-efficient.
"The new technical rules, which will apply from 2026, focus on greater electrification and advanced sustainable fuel.
"In addition to the existing cap on costs for teams, a cost cap for power unit manufacturers will be introduced in 2023.
"In addition, Formula 1 has set itself the ambitious goal of being a carbon-neutral racing series by 2030."
Formula One president Stefano Domenciali hailed Audi's decision as "a major event for our sport."
Audi also sees enormous potential by being associated with Formula One for selling more cars globally.
"In 2021, more than 1.5 billion TV viewers watched the races.
"Formula 1 is popular in key markets such as China and the USA, and the trend continues to rise -– even among young target groups."
Audi did race pre World War II in the European Championship that was the root of Formula One which began post-war.
Audi and three other German car manufacturers formed the Auto Union company.
They enjoyed their most successful campaign in 1936 when Bernd Rosemeyer won three of the four races, winning the title, with team-mate Hans Stuck second.