Subaru's Petter Solberg has retired from the Telstra Rally Australia, after hitting a rock in SS4 and going off the road.

The Norwegian, and his co-driver, Phil Mills were unhurt in the incident, however they were unable to continue.

"It's too bad, I didn't want to end the season like this, but that's just how it is sometimes," reflected 'Hollywood'.

"I was 5.8km from the start line on a right hand, third-gear corner and there was a rock on the apex, which I hit and broke the end of the steering arm. After that we couldn't steer and went off the road on the other side. Apart from that, the car is okay.

"We'll get it fixed and I'm looking forward to getting out there again tomorrow."

Solberg had been running second overall, around 10 seconds behind leader, Marcus Gronholm.