BERLIIN -- The Volkswagen Group supervisory board could decide next month whether its Audi and Porsche subsidiaries should compete in Formula One, German business paper Frankfurter Allgemeine Zeitung (FAZ) reported.
Entering the racing series, which is popular in Europe, would be costly but would give the two brands increased marketing exposure in key Asian markets including China and to a growing audience in the U.S.
Both Audi CEO Markus Duesmann and Porsche boss Oliver Blume are keen for their brands to join the competition, the paper said.
F1 boss Stefano Domenicali, a former VW Group executive and head of its Lamborghini supercar brand, is pressing the automaker's board for a decision soon so he can conclude lucrative TV marketing contracts, the report said.
VW Group's supervisory board will discuss the matter at the end of February, FAZ said, adding that group CEO Herbert Diess has long been considered a proponent of entry into F1.
The racing series is moving to become CO2-neutral from 2026 onward, using electrified powertrains and synthetic fuels.
Under more climate-friendly conditions, the two premium brands would be able to justify a very costly Formula One commitment from a sustainability perspective.
According to information from the FAZ report, Audi and Porsche want to jointly develop a F1 powertrain to save costs. They would not to be mere engine suppliers but would compete with their own racing teams.
Running costs for a top tier F1 team can easy top several hundred million euros per season, and only a part of that investment is returned in the form of sponsorship money.
The report said negotiations with the McLaren and Red Bull racing teams are at an advanced stage. These involve a purchase offer for McLaren by Audi and close Porsche cooperation with Red Bull.
Audi and McLaren denied initial rumors of a takeover of McLaren in November, however McLaren said it is open to technology collaboration "with relevant partners and suppliers."
The McLaren F1 team currently uses engines from Mercedes-Benz.
In an interview with Auto Bild Motorsport earlier this month, Domenicali made positive overtures to VW Group.
"I think we have an important month ahead of us in terms of the Volkswagen Group's decision," he said. "Getting involved would be great, but I can't speak on behalf of VW. I was part of this incredible group for a few years, and I know how hard they are working on the future."
Porsche had previously competed in Formula 1 with a team in the 1950s and 1960s and provided the power unit for four world championship titles for McLaren in the 1980s. Porsche withdrew from the premier class in 1991.