(CNN) -- Fernando Alonso stretched his lead in the world championship standings with a peerless drive from pole position to win the German Grand Prix at Hockenheim Sunday.
The 30-year-old Spaniard was claiming his third victory of the season for Ferrari after wins in Malaysia and the European Grand Prix.
He came home just under four seconds clear of the two-time defending champion Sebastian Vettel in his Red Bull.
But Vettel was demoted to fifth for running off the track as he overtook McLaren's Jenson Button on the penultimate lap of 67.
He was handed a 20 second penalty by race stewards to leave Britain's Button in second place and Finland's Kimi Raikkonen (Lotus-Renault) in the final podium position.
Kamui Kobayashi of Japan was promoted to fourth, with Mexican teammate Sergio Perez (Sauber) in sixth.
Home hero and seven-time champion Michael Schumacher was seventh for Mercedes ahead of Red Bull's Mark Webber, who lost ground in the title race.
German Nico Hulkenberg, who was ninth for Force India, and his compatriot Nico Rosberg, in the second Mercedes, completed the points scoring.
2008 world champion Lewis Hamilton (McLaren) saw his title chances further recede after being forced to retire after a puncture picked up from track debris.
It followed an early collision between Ferrari number two Felipe Massa and Frenchman Romain Grosjean of Lotus.
For Alonso, a third world title beckons after stretching his lead to 34 points over Australia's Webber, with Vettel in third, but 10 points further adrift.
"We'll enjoy the win," said Alonso. "Starting on pole was the key factor because it was difficult to overtake and we were not the fastest but we kept the position."
Vettel told the post-race press conference that he had not intended to hinder Button as he overtook the Briton.
"The last thing you want to do is make contact. When we were side-by-side, I tried to give him enough room -- but it's difficult to see.
"I went wide. We were all struggling with tires, Jenson in particular, which is why I was able to pass him."