Four-time world champion was linked with a switch to Mercedes but renews deal with Italian manufacturer
The four-time world champion, who currently leads the F1 drivers’ championship, was out of contract at the end of the season.
Sebastian Vettel has agreed a new £120m three-year deal with Ferrari
The German will pocket £40m a year as part of the blockbuster deal
However, the 30-year-old, who was linked with a switch to Mercedes, has put pen to paper on the lucrative deal, reconfirming his place as the best-paid driver on the grid.
Vettel’s £40m-a-year package, including bonuses, is expected to contain performance-related exit clauses.
Earlier this week, his Ferrari team-mate, Kimi Raikkonen, was confirmed for 2018 on a cut-price £7m-a-year package.
The news that Ferrari are retaining their current driver pairing means it is likely that Mercedes will do the same.
Lewis Hamilton is already under contract, while Valtteri Bottas is expected to sign a one-year extension to his deal.
Merc’s non-executive chairman Niki Lauda confirmed there had been talks with Vettel but they stopped months ago.
Seb Vettel is the best-paid driver in Formula One
The German currently leads the drivers’ championship ahead of the Belgian Grand Prix
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He said: “We discussed it briefly once with him, but the more competitive Ferrari goes the less the reason he would want to leave, so therefore we stopped right away a couple of months ago.
“I think every driver, if he’s clever, talks to more than one team. Then when you negotiate you’re in a better position. That’s what he did.”