The 1989 season saw some improvement. The all-new, Cosworth DFR-powered Osella FA1M performed better in the qualifying sessions (most notably in the Japanese Grand Prix, where Larini qualified 10th). The fine qualifying performance, however, didn't translate into good results in the races. The cars rarely saw the finish line due to several technical failures. The most frustrating race was the Canadian Grand Prix, where Larini had climbed to third during the race but retired when the FA1M's electrics failed due to water ingress. At the end of the season, on the occasion of the Australian Grand Prix, Ghinzani suffered a high-speed collision with the Lotus of Nelson Piquet, leaving him with an injured ankle. Right after, Ghinzani announced his retirement.