Anthony Davidson Peugeot 2011 Le Mans 24 HoursPeugeot LMP1 prototype driver Anthony Davidson says the French manufacturer's shock withdrawal from front-line sports car racing is a huge blow to the FIA's new World Endurance Championship.

Peugeot announced on Wednesday that it was canceling its endurance prototype program with immediate effect. The announcement came on the same day as the entry deadline for the new WEC.

Prototype sports car racing was granted world status for by the FIA World Council last autumn after a 20-year hiatus, and had been expected to become a huge battle for global title honors between turbo-diesel LMP1 manufacturer teams from Audi and Peugeot. The 2012 Le Mans 24 Hours is also to be the scene of Toyota's return in factory guise with a hybrid prototype coupe, which was also revealed today for the first time (see separate story).

"It was such a disappointment to hear the news today," said Davidson, who scored three victories for Peugeot in 2011. "I'm devastated for the Peugeot team and everybody who has worked so hard over the last two years."

The Briton, who also claimed three pole positions with the works team last year, added: "It's a real blow for the World Endurance Championship and the fans who were looking forward to another tremendous battle between three manufacturers."

The current Euro-zone financial crisis is believed to have been a key factor in Peugeot's decision, with France having recently also suffered a credit rating downgrade. PSA – Peugeot's parent company – also announced last week that it suffered a 6.1 percent decline in sales over the past year in Europe and expected that trend to continue this year.

Peugeot's Sport department has not been closed as part of today's announced changes, which according to the company have been made to ensure the successful launch of its new 208 and hybrid road car ranges. It is understood that the door has been left open to future racing programs should funds once again become available in 2013.