The news is something of a surprise given Team Principal Mattia Binotto described Vettel as “our preference at the moment” for its as yet unfilled seat in 2021 at Ferrari's season launch, and Vettel himself had not indicated that he might leave when he spoke to media last month.
However, reports in Italian media later in April suggested an impasse regarding the term and remuneration of a new agreement, before multiple stories claiming a split broke in Germany on the evening prior to Ferrari's announcement (this morning AEST).
Vettel, however, dismissed any notion that his salary had been a sticking point, commenting in Ferrari's announcement that “Financial matters have played no part” in the decision.
“My relationship with Scuderia Ferrari will finish at the end of 2020,” he said.
“In order to get the best possible results in this sport, it's vital for all parties to work in perfect harmony.
“The team and I have realised that there is no longer a common desire to stay together beyond the end of this season.
“Financial matters have played no part in this joint decision. That's not the way I think when it comes to making certain choices and it never will be.
“What's been happening in these past few months has led many of us to reflect on what are our real priorities in life.
“One needs to use one's imagination and to adopt a new approach to a situation that has changed. I myself will take the time I need to reflect on what really matters when it comes to my future.
“Scuderia Ferrari occupies a special place in Formula 1 and I hope it gets all the success it deserves.
“Finally, I want to thank the whole Ferrari family and above all its ‘tifosi' all around the world, for the support they have given me over the years.
“My immediate goal is to finish my long stint with Ferrari, in the hope of sharing some more beautiful moments together, to add to all those we have enjoyed so far.”
Binotto paid tribute to Vettel's achievements with the team, which include 14 grand prix wins over five seasons, and stated that the conclusion to the contract talks was mutual.
“This is a decision taken jointly by ourselves and Sebastian, one which both parties feel is for the best,” he said.
“It was not an easy decision to reach, given Sebastian's worth as a driver and as a person. There was no specific reason that led to this decision, apart from the common and amicable belief that the time had come to go our separate ways in order to reach our respective objectives.
“Sebastian is already part of the Scuderia's history, with his 14 Grands Prix wins making him the third most successful driver for the team, while he is also the one who has scored the most points with us.
“In our five years together, he has finished in the top three of the Drivers' Championship three times, making a significant contribution to the team's constant presence in the top three of the Constructors' classification.
“On behalf of everyone at Ferrari, I want to thank Sebastian for his great professionalism and the human qualities he has displayed over these five years, during which we shared so many great moments.
“We have not yet managed to win a world title together, which would be a fifth for him, but we believe that we can still get a lot out of this unusual 2020 season.”
Ferrari already has Charles Leclerc on the books at least until 2024 but Vettel's replacement is at this point unknown.
Lewis Hamilton is coming off-contract but he has been forward in expressing his commitment to the Mercedes-AMG Formula One Team in recent weeks and suggested that the glory of winning with the Prancing Horse is “a short-term kind of thing.”
The lead driver at F1's other ‘big three' squad, Max Verstappen, has already inked a new deal with Red Bull Racing, a play which team advisor Helmut Marko admitted was in part designed to prevent Mercedes from poaching him.
Ricciardo and Vettel drove together at Red Bull in 2014 and the former did not rule out a return to Milton Keynes when the idea was put to him recently.
In their season as team-mates, Ricciardo wound up third in the world drivers' championship and Vettel fifth.
The German had won the preceding four titles, but has been unable to build on that tally since landing at Maranello in 2015.
His best finishes in the championship since then have been second, to Hamilton, in 2017 and 2018.
Vettel was fifth again last year, one position behind Leclerc, with one race win over the campaign to his younger team-mate's two.