It will pull out of Formula 3 at the end of the year.
Volkswagen has announced it is shifting its motorsport focus to production-based customer racing.
The German manufacturer walked away from the World Rally Championship at the end of 2016 after four dominant seasons, and earlier this week it confirmed it would bring an end to its Formula 3 engine supply program as the category introduces new regulations for 2019.
Volkswagen's current F3 supply effort began in late 2007 when it began producing 2-liter naturally aspirated four-cylinder engines for the FIA-backed European F3 series as well as other regional championships.
Now it is turning its attention to its TCR customer touring car, the Golf GTI TCR (below left), and the Polo R5 rally car (below right) which will be made available later this year.
"In the future, we will place even greater emphasis on Volkswagen products. The Golf GTI TCR is already an important ambassador for the brand in many racing series around the world, and we are pursuing the same goal with the new Polo GTI R5," said Volkswagen Motorsport Director Sven Smeets.
"Both cars are not only attractive propositions for professional customer teams, but also represent top-class cars for talented youngsters. This way, we are also able to continue our long-term philosophy of offering youth opportunities. The many national, regional and international series, in which the Golf GTI TCR and Polo GTI R5 are in action, allow the young drivers to develop step by step at the wheel of a Volkswagen"
"In Formula 3, Volkswagen can look back on a remarkable record. For more than three decades, Volkswagen teams and drivers have enjoyed great success against teams from other manufacturers – we are sincerely grateful to them for this,' Smeets added. 'We will continue to provide our customers with consistent support, in order to bring the 2018 season to a successful close in the FIA Formula 3 European Championship and at the FIA Formula 3 World Cup in Macau."
As well its customer operations, the Volkswagen brand will still have a factory presence in top-level rallycross, with Volkswagen Sweden competing with the Petter Solberg Rallycross and Kristoffersson Motorsport team competing in the FIA World Rallycross championship, and Volkswagen of America continuing to support Andretti Autosport in the new Americas Rallycross championship.