Reports in the German newspaper Bild say that Fiat, who own Ferrari, are determined to prevent Schumacher, twice a world champion, joining McLaren-Mercedes next season. Schumacher, currently paid pounds 17.5m a year, has a contract with the Italian Grand Prix team until the end of next season.
However, the head of Fiat, Gianni Agnelli, is reported to have approved a new contract that would keep the 29-year-old Schumacher at Ferrari for another three years followed by a lifetime job as the company's roving ambassador. Willi Weber, Schumacher's manager, said: "I prefer not to say anything, just this: there have been no negotiations so far."
Schumacher, despite losing the world championship to Jacques Villeneuve last season, is still regarded as the best in the business and one of the greatest racing drivers of all time. He has competed in 103 grands prix and won 27.
As well as McLaren, being in the frame for his services, the British American Racing team, who have taken over Tyrrell, have made no secret of their interest. Craig Pollock, BAR's team chief, would like to pair Schumacher with Villeneuve in 1999.
"If I can go for Jacques Villeneuve, I can go for Michael Schumacher," Pollock said recently. A comment that Ferrari have taken to heart.