Blow for Ferrari as court rejects cap plea

The loss of Ferrari, especially, would deal a huge blow to the credibility of Formula One. The famous red cars, carrying the iconic badge of a prancing black horse, made their debut in the first-ever world championship round, the 1950 Monaco Grand Prix, and have since won a record 16 constructors titles including that of last year.

However, Mosley has maintained that no team is bigger than the sport, and he remains committed to slashing costs in the face of a global credit crunch that has already forced the giant Japanese Honda concern to quit the pit lane.

During yesterday's one-hour hearing at the Tribunal de Grande Instance in Paris, Ferrari's chief legal representative claimed the FIA had presented the team with "a fait accompli".

Emmanuel Gaillard insisted the £40m cap meant a top team like Ferrari would have make a reduction in it's racing budget of between 80-90 per cent. "It's simply impossible," he said.

Although any cap would be voluntary, those teams who stick to the limit will be given greater technical freedom and that has created fears of a two-tier championship.

Despite that, Judge Jacques Gondrand de Robert dismissed the case and said: "There is no imminent damage that needs to be prevented or clearly unlawful unrest that needs to be stopped."