From 1988, Sauber acted as Mercedes' official works team. The partnership reached its zenith in 1989, a one-two in the legendary Le Mans 24-hour race backed up by the Drivers' and Manufacturers' titles in the World Sports Car Championship. A year later the team repeated its success in the World Sports Car Championship. Sauber Motorsport had now expanded to some 50 employees.
This period also saw the establishment of the junior team, an idea of Sauber's then business partner Jochen Neerpasch. Michael Schumacher, Heinz-Harald Frentzen and Karl Wendlinger were selected for the team. Peter Sauber helped all three to take the step up into Formula One.
With the lustre of the World Sports Car Championship beginning to fade, Mercedes set its sights on F1 and, in summer 1991, it was declared a joint project. Preparations hit full swing and Sauber built a new factory at its premises in Hinwil. However, bad news was on its way that November. The challenging economic climate at the time caused the Mercedes Board of Management to decide not to enter F1 with a works team. Sauber was left with two options – pocket the financial settlement and turn its back on racing or use it as start-up capital for its own grand prix operation.
In January 1992, Sauber decided to take the plunge, and in autumn that year the C12 completed its first testing session, an Ilmor engine providing the power. By that time the company was employing just under 70 people. On 14 March 1993, two Sauber C12 racers – piloted by Karl Wendlinger and JJ Lehto – lined up, as planned, on the grid at Kyalami for the South African Grand Prix. The two World Championship points earned by Finnish driver Lehto for fifth place in the race ensured the team's debut was a widely-acclaimed success.
Contracts signed with Red Bull and Petronas in 1995 gave the Swiss team a solid foundation and allowed it to establish itself as a fixture in F1. In 1995 and 1996 Sauber served as the Ford works team, and from 1997 the cars were powered by Ferrari engines and carried the name of title sponsor Petronas.
However, the crucial breakthrough remained elusive. That was until 2001, when three milestones in the team's history arrived in quick succession – the partnership with major Swiss bank Credit Suisse, a fourth-place finish in the F1 Constructors' World Championship in mid-October and, just a few days later, the groundbreaking ceremony for the team's own wind tunnel.
Peter Sauber chose this time to introduce fresh blood into Formula One, bringing Kimi Raikkonen and Felipe Massa into the team. Sauber later recommended Robert Kubica to the powers-that-be at BMW. In 2005, and now in his early sixties, Peter Sauber decided to explore ways of passing on his life's work into good hands. An offer from BMW appeared to tick the right boxes. The Munich-based manufacturer, who had been working in F1 with Williams since 2000, was keen to line up with its own works team.
On 22 June 2005, BMW announced that it had acquired a majority stake in the Swiss team. In 2007, the team finished second in the Constructors' World Championship, and 2008 – the third year of the BMW Sauber F1 Team – was the next high point in Sauber's history. The development of the team in Hinwil was now complete and the workforce had grown to over 400. The team set itself the goal for the year of recording their maiden victory. That first win duly arrived in the form of a one-two, Kubica leading Nick Heidfeld across the line in Canada.
The BMW Sauber F1 Team notched up a total of 11 podium finishes in 2008. Kubica clinched the team's first pole position in Bahrain and Heidfeld added its first two fastest race laps to the honours board. The team finished the season in third place in the World Championship with 135 points.
A difficult start to 2009 was followed on 29th July by a piece of news that sent shockwaves through the team – at a press conference in Munich, BMW announced that it was withdrawing from F1 at the end of the season. The company bowed out of F1 with 36 points and sixth place in the World Championship in its final season.