Ferrari's announcement came minutes after confirmation of Fernando Alonso's departure from the team after a five-year spell in which the Spaniard ultimately failed to deliver a world championship title.

The last time the 'Scuderia' topped the drivers' standings was in 2007 when Raikkonen, in his previous spell with the team, triumphed before quitting the sport to test his skills in rallying.

Since then, the 'Prancing Horse' and the iconic red Ferrari cars have been playing catch-up to the Renault engines that have fired Red Bull and Vettel to four consecutive titles in the drivers' and constructors' standings.

German Vettel is regarded as the heir to stricken compatriot Michael Schumacher, who won five of his seven world titles with Ferrari.

Vettel currently sits fourth in the drivers' standings, 158 points behind Britain's Lewis Hamilton ahead of the final race of the season at Abu Dhabi.

Ferrari team principal Marco Mattiacci believes Vettel's "youthfulness and experience" will make him an "invaluable asset" to the team as they look to end their seven-year title wait.

"Scuderia Ferrari has decided to put its faith in the youngest multiple champion in the history of Formula One," Mattiacci said.

"In Formula One terms, Sebastian Vettel is a unique combination of youthfulness and experience and he brings with him that sense of team spirit which will prove invaluable when, together with Kimi, they tackle the challenges awaiting us, as we aim to be front runners again as soon as possible."

Vettel, who has won four consecutive world titles in 2010, 2011, 2012 and 2013 said he was delighted to be given the chance to emulate his "greatest idol" Schumacher.

"The next stage of my Formula 1 career will be spent with Scuderia Ferrari and for me that means the dream of a lifetime has come true," said Vettel.

"When I was a kid, Michael Schumacher in the red car was my greatest idol and now it's an incredible honour to finally get the chance to drive a Ferrari.

"The Scuderia has a great tradition in this sport and I am extremely motivated to help the team get back to the top. I will put my heart and soul into making it happen."

Schumacher, 45, who raced for Ferrari between 1996 and 2006, is currently receiving treatment at his home in Gland, Switzerland, after suffering severe brain injuries in a skiing accident in the French Alps last December.

Alonso, meanwhile, is being tipped with a return to the McLaren team after leaving Ferrari by "mutual consent", according to a team statement.

"Fernando Alonso leaves the team at the end of this season, after a five year period which, with one race remaining, saw him score 1186 points, 44 podiums and 11 wins.

"Everyone at Scuderia Ferrari thanks Fernando for his great contribution on both a personal and professional level."

Alonso, who won two world titles with Renault in 2005 and 2006, admitted leaving Ferrari was not an easy decision to make.

Alonso said: "It was a difficult decision to take, but a carefully considered one and from start to finish, my love for Ferrari was a prime consideration.

"I leave Scuderia Ferrari after five years, during which I reached my very best level professionally, tackling major challenges that pushed me to find new limits.

"I am very proud of what we have achieved together. Now I look to the future with great enthusiasm, knowing that part of my heart will always belong to the Prancing Horse."

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