MARANELLO, Italy (AP):

FORMULA ONE will undertake a massive cost-cutting operation that will enable the sport to operate on expenditure levels comparable with the 1990s within four years, Ferrari president Luca Cordero di Montezemolo predicted yesterday.

Montezemolo, president of the Formula One Teams Association (FOTA), expressed his views in a statement after a meeting a day earlier with the president of autoracing's governing body FIA, Max Mosley.

Montezemolo said that the meeting's outcome "will enable us to drastically cut costs as of the upcoming season (and) to have a complete new Formula One in the year 2012 ... distinguishing itself by an innovative spirit and great attention as far as the environment is concerned, but on economic levels as in the '90s".

Honda pulling out

Formula One received a jolt when Honda announced last week it was pulling out of the sport. The Japanese automaker said that in the current economic downturn it needs to focus on its core business of making and selling cars rather than spending US$291 million (euro225 million) a year to race them on Grand Prix tracks.

The proposals are focused mainly on cutting engine costs, including the use of a standardised Cosworth engine, which teams must have signed up for by yesterday if they want to use it in 2010. Teams that don't sign can still build their own engines, but along specific guidelines.

World champion Lewis Hamilton has concerns about the plans.

"I don't think that's going to happen. Formula One is a manufactured sport and you won't have Formula One without the manufacturers," Hamilton said yesterday. "What are you going to do? I can't imagine it (Formula One) ever being without Ferrari, without Mercedes Benz, without Renault.

"All these big companies are what make the sport, therefore there is a constructors' championship as well as a drivers' championship."