Stewart-Haas Racing co-owner Gene Haas and crew chief Rodney Childers, discuss the dominance of Kevin Harvick‘s team at Phoenix International Raceway and taking control of the race.
CHARLOTTE, N.C. — Cup team executives say they need additional revenue streams to fix a “broken” business model and said NASCAR recently rejected their seven-point proposal that would have addressed those concerns.
“We’re very far apart,” Jeff Gordon, vice chairman of Hendrick Motorsports, said of the teams and NASCAR.
Gordon is one of four members of the negotiating committee for teams. They spoke with select media members for more than 90 minutes Friday to share their concerns. Gordon was joined by Curtis Polk, an investor in 23XI Racing and Michael Jordan’s longtime business manager, Joe Gibbs Racing President Dave Alpern and RFK Racing President Steve Newmark.
“The economic model is really broken for teams,” Polk said.
Polk declined to say what the proposal to NASCAR included, but he said that all Cup organizations need help.
“The sustainability of the teams in this sport is not very long-term unless we have a fundamental change in the (business) model,” he said.
Gordon stated that Hendrick Motorsports, which has won the past two Cup championships, will not make a profit this season. He also said that it had been “awhile” since the organization had done so.
“Where we’re currently at is not sustainable,” Gordon said.
Newmark said the feedback from the majority of the 16 teams that own the 36 charters in Cup is that “they continue to lose money in this economic model.”
NASCAR issued a statement Friday afternoon in response to the concerns stated by the team executives: “NASCAR acknowledges the challenges currently facing race teams. A key focus moving forward is an extension to the Charter agreement, one that will further increase revenue and help lower team expenses. Collectively, the goal is a strong, healthy sport, and we will accomplish that together.”
Unlike other sports leagues, which receive numerous revenue streams from leagues, NASCAR is built differently.
The sport is owned by the family of founder Bill France Sr. The France family also owns a majority of the tracks. Speedway Motorsports also owns a collection of tracks, while a few are independent.
Polk said that the group’s calculations showed that 93% of the sport’s value resides with NASCAR and the tracks. The remaining 7% is with teams.
“There’s not a sport that I know of where the inequity is so severe,” Polk said.
He also said that the sport is a “money-printing machine, but the teams put on the show. The teams are the content. The drivers, the team owners and the cars are what fans turn on for every week and what the media companies pay the big money.”
NASCAR, tracks and teams share TV revenue — a 10-year deal estimated at $8.2 billion that will end after the 2024 season.
For each race, 65% of the TV money goes to the tracks, 25% goes to teams and 10% goes to NASCAR.
After Dover Motorsports was sold to Speedway Motorsports in 2021, it provided financial projections for 2021-2024 for Dover Motor Speedway and Nashville Superspeedway.
The estimated revenue from broadcasting rights for one race at Dover and one at Nashville in 2021 was $37 million. That’s after NASCAR takes its 10%. With NASCAR’s cut included, that is $40.7 million total.
The approximate breakdown of that $40.7 million would be $26.45 million to the tracks, $10.55 million to teams and $3.7 million to NASCAR based on the model of 65% to tracks, 25% to teams and 10% to NASCAR for those two events (one at Dover and one at Nashville).
None of the negotiating committee members cited a specific percent of the TV money wanted but talked of a better revenue stream model.
With teams getting a smaller percentage of the TV money, they have to rely on sponsorship to cover costs.
Newmark said that sponsorship makes up about 60-80% of a team’s overall revenue. He noted how that is out of line with other sports.
The Fenway Sports Group, which is a co-owner of RFK Racing, also owns the Boston Red Sox in Major League Baseball, the Pittsburgh Penguins in the National Hockey League and Liverpool Football Club in the English Premier League.
Newmark noted that in Major League Baseball, 8-12% of a team’s overall revenue comes from sponsorship. In the NHL, that figure is 17-18% and for the Premier League it is closer to 26-27%.
All those totals are significantly lower than the NASCAR model. The impact of sponsorship on teams was evident this year with Joe Gibbs Racing losing Kyle Busch after this season.
Long-time sponsor Mars, Inc. announced last December that it would not return to the team or sport after this season. That began a search by JGR for a company that could invest an estimated $20 million into the No. 18 team and Busch.
After a deal with another company fell through earlier this year, Gibbs was left without a sponsor and unable to sign Busch — the only active multi-time champion in the sport — to a new contract.
The end result is that Busch and JGR will part ways after this season in one of the biggest driver moves in years.
“There is no other pro sport where the signing of your top athlete is completely dependent on the decision of someone at a brand,” Alpern said. “Imagine if Aaron Rodgers of the (Green Bay) Packers had a contract held up because the stadium sponsor hadn’t made their decision on what they’re doing.
“That’s what we’re faced with as race teams. And, if I’m honest, we’ve almost become full-time fundraisers. We spend the majority of our time raising money, not to make money (but) to survive.”
23XI Racing came into the sport after financial problems for another team. Germain Racing was going to lose sponsor GEICO after the 2020 season. Unable to find a sponsor to take over, the team shut down, selling its charter to 23XI Racing. That provided the charter for Bubba Wallace in the team’s first season.
23XI Racing purchased a second charter in December 2021, paying $13.5 million for StarCom Racing’s charter, making it the most expensive charter purchased.
Charters were created before the 2016 season to give teams value after seeing so many teams close shop and sell parts and pieces for significantly reduced prices. While talk in the garage is that charter prices are nearing $25 million with so few looking to sell, it is still a small value when compared to other sports leagues. The current charter deal expires after the 2024 season.
While not a direct comparison, the value of a NASCAR team is well below other sports teams. In 2021, Forbes ranked all 32 NHL franchises in value. Ranking last was the Arizona Coyotes, which had a value of $400 million.
Polk sees where NASCAR team valuation is at and where it can be. He said the maxim is “all well-managed teams should be able to compete for a Cup championship and make a reasonable profit.”
As for “reasonable profit,” Polk said: “We’re not looking to make two, three, four times our money in a given year but if we can squeak out a little bit of a profit after paying all of our overhead, I think everybody will be happy.
“When you have a model like that, it will attract investors, like myself and Michael Jordan.”
The teams say they keep hearing from NASCAR to cut costs but suggest that they have done so. Additional cuts could impact what fans see on the track.
Polk said that with the proposal from teams rejected, they received a proposal from NASCAR “with a minimal increase in revenue.
“The emphasis was on cutting costs dramatically. With the Next Gen car, the costs of the car are somewhat fixed. So what would that lead to? It would lead to massive layoffs at our teams.”
Alpern raised an issue with the notion of additional cuts.
“When it comes to cost-cutting, one of the things that’s kind of surprising in our sport is that when any of the other stakeholders spend money on something, an upgrade, signing someone from another league, it’s viewed as an investment within the sport.
“But when teams spend money, it’s we’re reckless and you need to cut. We’re investing in our business as well, whether it’s people, our facilities, we’re all trying to grow the sport and the answer to everything is not cut costs. I don’t know of another sports league or business, for that matter, who came to prosperity through cutting.”
NASCAR President Steve Phelps says that he will tell drivers this weekend that “we care” about them and safety.
Phelps and other series officials are scheduled to meet with drivers Saturday morning to discuss safety measures with the Next Gen car.
Three drivers will miss Sunday’s Cup playoff race at the Charlotte Roval because of crash-related injuries.
It is believed to be the first time in more than 20 years that three full-time Cup drivers will sit out the same race because of injuries suffered in on-track accidents.
Kurt Busch will miss his 12th consecutive race Sunday. Concussion-like symptoms have sidelined him since a July 23 crash in qualifying at Pocono Raceway. He said recently that he is “hopeful” of returning but didn’t have a timeline. Five races remain in the season.
Alex Bowman will miss his second consecutive race because of continued concussion symptoms after his Sept. 25 crash at Texas Motor Speedway.
Cody Ware is sitting out Sunday’s race while he recovers from an impaction fracture to his right ankle suffered in a Sept. 25 crash at Texas. Ware stated this week on social media that given the “extensive footwork required for a road course event, I don’t feel I’m able to give 100% effort to my team, my sponsors or to Ford.” He plans to be back in the the car the following week at Las Vegas.
Drivers says that the impacts they are feeling this year are harder with the Next Gen car. Busch and Bowman were injured in rear-end impacts.
The car was strengthened to help protect drivers in severe crashes, such as Ryan Newman’s 2020 Daytona 500 crash and Joey Logano’s 2021 Talladega accident. In making the car safer for those types of crashes, it’s made the impacts feel harder in more common crashes.
Hamlin questioned NASCAR’s leadership and called for the car to be redesigned last weekend at Talladega. Phelps met with Hamlin a day later.
“Denny and I have a good relationship,” Phelps told NBC Sports and The Associated Press on Wednesday. “We do. He says things that sometimes I disagree with. I’m sure there’s things I say that he disagrees with.
“I probably would have gone with a different approach, understanding kind of what he knows what’s going on in the process. I’m certainly glad we had a discussion. I gave him my opinion. He gave me his. I thought there was a healthy discussion.”
More drivers began raising concerns last week about safety concerns with the car, including Chase Elliott.
“We need to make sure that we are doing everything we can to make our drivers feel safe in the vehicles and have them understand that we certainly care about their safety because we do,” Phelps said.
“We’re working on things with our own people internally, our race teams, (manufacturers) and drivers to make sure that we have a plan in place moving forward so that — I don’t know that it’s gaining the trust — but doing better.
“Our goal is to be the safest motorsports on the planet … that’s what we’re aspiring to do.”
NASCAR conducted a crash test of a rear clip and rear bumper structure at an Ohio facility this week. Series officials are also examining elements with the headrest foam and working with Wake Forest University to test mouthpiece sensors that track a driver’s head movements in a crash.
Jeff Burton, director of the Drivers Advisory Council and an analyst for NBC Sports, says he’s had regular communication with NASCAR on behalf of the drivers.
“We feel like we have cooperation with NASCAR,” Burton said last week at Talladega in regards to safety issues. “We know the commitments from NASCAR. They’ve made real commitments to us. We want to see those commitments through. I believe that we will in regards to changes to the car.”
As for his message to drivers in Saturday’s meeting, Phelps said he would tell them: “We’re going to do our best to make sure that when you strap in that car, you feel safe.”
2. “Ridiculous statement”
NASCAR suspended crew chief Rodney Childers four races and penalized Kevin Harvick 100 points for modifications to a deck lid this week.
The penalties were discovered at NASCAR’s R&D Center. Series officials typically take a couple of cars back from most events to the R&D Center. More complete inspections can be done there than at the track.
NASCAR took the cars of Harvick and Martin Truex Jr. after last weekend’s race at Talladega. Truex’s car had no issues.
There are some who would suggest that NASCAR was getting back at Harvick for recent critical comments of NASCAR’s safety efforts.
NASCAR President Steve Phelps’ response to that notion?
“I would say it’s ridiculous,” he said. “No one has a vendetta against Kevin Harvick or Rodney Childers at all. Or Stewart-Haas Racing. That’s a ridiculous statement.”
As for the inspection process, Phelps said: “Our (officials) are going to look at it, look at it again, look at it a third time to make sure that if there is a penalty given, that penalty is right. If the No. 4 team thinks that is not right, they will file an appeal and we’ll go through the appeal process.”
Stewart-Haas Racing announced Friday morning that it is appealing the penalty to Harvick and his team. However, Childers will sit out this weekend’s race at the Charlotte Roval. That way, regardless of the outcome, he will be able to return for the season finale at Phoenix.
3. Report card
During a panel discussion at the Women in Motorsports seminar this week at Charlotte Motor Speedway, NASCAR President Steve Phelps said that The Institute for Diversity and Ethics in Sport provided a racial and gender report card for NASCAR, its teams and the industry for the first time.
The report looks at the race and gender of athletes and front office personnel in those sports. Some reports examine the race and gender of officials and even broadcasters.
Phelps said that he would not disclose the results for NASCAR.
“We are doing some terrific work,” Phelps said during the panel discussion.
Phelps noted that the grades “are not going to be what they should be, but you need to face it. … We’re going to do better. One thing I will say is that the programs that we have put in place over the last few years have gotten an A.”
Asked by NBC Sports about the report, Phelps said: “It validated where I thought we were, which is why I want to keep it quiet. We’re actually doing really good work. … Hiring people of color, hiring women, promoting people of color, promoting women.
“I don’t want to lose that momentum to where our Diversity Industry Council is like, ‘Wait, wait, you said you’re doing all these things but it’s not working.’
“It’s going to take time. It’s not a snap your fingers (and it’s all done). Proud of the programs we’re doing.”
Thursday, NASCAR announced that 13 drivers have been invited to the Drive for Diversity combine. The program was created in 2004 to develop and train ethnically diverse and female drivers both on and off the track.
4. Change of strategy
An appeal panel rescinding the 25-point penalty to William Byron moves him back into a transfer spot heading into Sunday’s elimination race at the Charlotte Roval (2 p.m. ET on NBC).
Cindric said Thursday — before Byron’s penalty was amended — that what happened to Byron would impact how he races.
“It completely changes how our race looks this weekend, how our race strategy looks, what our priorities are,” Cindric said on if Byron got his points back.
“Even if (the points) get returned, we’re still in a reasonably good spot to think we could still point our way in. It’s not a must-win for us either way, but I think it definitely changes the race strategy for us.”
Cindric explained how the strategy could change with Byron moving back into a transfer spot.
“You probably have to take higher risk to get points … or take a higher risk to just go after the race win,” he said.
5. Appeal Panel’s changes
William Byron’s penalty marked the fourth time this year the National Motorsports Appeals Panel or Final Appeals Officer has amended or rescinded a penalty by NASCAR.
In January, the Final Appeals Officer rescinded a $50,000 fine and six-week suspension to Ryan Bell, crew chief for Mike Harmon Racing. The team and Bell had been penalized when Harmon used one of his team’s Xfinity cars for a charity event at Rockingham Speedway.
Roger Werner, the National Motorsports Final Appeals Officer, wrote in his decision that “the decision of the National Motorsports Appeals Panel, upholding the original penalty that was issued by NASCAR, was incorrect in light of the NASCAR rulebook modification made on January 24, 2022.”
In May, the National Motorsports Appeals Panel overturned a disqualification to Matt Crafton following his fifth-place finish in the Camping World Truck Series race at Darlington.
Crafton’s truck was disqualified after NASCAR deemed the vehicle was too low in the front. The panel determined “the Appellants did not violate the Rule(s) set forth in the Penalty Notice.”
Crafton’s fifth-place finish was reinstated. No other reason from the panel was given. The panel consisted of Dixon Johnston, Tom DeLoach and Hunter Nickell.
In September, NASCAR penalized Jeremy Clements for an intake manifold violation after his win at Daytona. NASCAR’s penalty did not allow the win to count toward playoff eligibility.
Clements and his team took the engine to the NASCAR R&D Center to be inspected but left the intake manifold on, which was not required to be a part of the inspection.
Clements and his team noted to the panel that they shouldn’t have been penalized for a part that was not inspected on other engines. The panel agreed and rescinded the penalty, allowing the win to count toward playoff eligibility. The panel consisted of Richard Gore, DeLoach and Johnston.
Then came Thursday’s decision by the National Motorsports Appeals Panel to rescind the 25-point penalty to Byron for spinning Denny Hamlin at Texas.
The panel did not state why it eliminated the point penalty but increased Byron’s fine from $50,000 to $100,000. The panel consisted of Dale Pinilis, Kevin Whitaker and Nickell.
By getting those 25 points back, Byron enters Sunday’s elimination playoff race at the Charlotte Roval (2 p.m. ET on NBC) 14 points above the cutline.
Daniel Suarez is now in the final transfer spot to the Round of 8. He is 12 points ahead of Chase Briscoe and Austin Cindric. Christopher Bell is 45 points behind Suarez. Alex Bowman will not race this week as he continues to recover from concussion symptoms and has been eliminated from Cup title contention.
NASCAR did not penalize Byron after his incident with Hamlin because series officials did not see the contact. Two days later, NASCAR penalized Byron 25 points and fined him $50,000 for intentionally wrecking Hamlin.
The National Motorsports Appeals Panel stated that Byron violated the rule but amended the penalty to no loss of driver and owner points while increasing the fine to $100,000.
The panel did not give a reason for its decision. NASCAR cannot appeal the panel’s decision.
The panel consisted of Hunter Nickell, a former TV executive, Dale Pinilis, track operator of Bowman Gray Stadium and Kevin Whitaker, owner of Greenville-Pickens Speedway.
Here is the updated standings heading into Sunday’s race at the Roval:
Byron’s actions took place after the caution waved at Lap 269 for Martin Truex Jr.’s crash. As Hamlin slowed, Byron closed and hit him in the rear.
Byron admitted after the race that the contact was intentional, although he didn’t mean to wreck Hamlin. Byron was upset with how Hamlin raced him on Lap 262. Byron felt Hamlin forced him into the wall as they exited Turn 2 side-by-side. Byron expressed his displeasure during the caution.
“I felt like he ran me out of race track off of (Turn) 2 and had really hard contact with the wall,” Byron said. “Felt like the toe link was definitely bent, luckily not fully broken. We were able to continue.
“A lot of times that kind of damage is going to ruin your race, especially that hard. I totally understand running somebody close and making a little bit of contact, but that was pretty massive.”
On the retaliatory hit, Byron said: “I didn’t mean to spin him out. That definitely wasn’t what I intended to do. I meant to bump him a little bit and show my displeasure and unfortunately, it happened the way it did. Obviously, when he was spinning out, I was like ‘I didn’t mean to do this,’ but I was definitely frustrated.”
The 13 drivers who will participate in the Advance Auto Part Drive for Diversity Combine were revealed Thursday and range in age from 13-19.
The NASCAR Drive for Diversity Development Program was created in 2004 to develop and train ethnically diverse and female drivers both on and off the track. Cup drivers Bubba Wallace, Daniel Suarez and Kyle Larson came through the program.
The 2020 and 2021 combines were canceled due to the impact of COVID-19.
“We are thrilled that we are in a position to return to an in-person evaluation for this year’s Advance Auto Parts Drive for Diversity Combine,” Rev Racing CEO Max Seigel said in a statement. “We are energized by the high-level of participating athletes and look forward to building the best driver class for 2023. As an organization, we have never been more positioned for success and future growth.”
The youngest drivers are Quinn Davis and Nathan Lyons, who are both 13 years old.
The group includes 17-year-old Andrés Pérez de Lara, who finished seventh in his ARCA Menards Series debut in the Sept. 15 race at Bristol Motor Speedway.
Also among those invited to the combine is 15-year old Katie Hettinger, who will make her ARCA Menards Series West debut Oct.. 14 at the Las Vegas Bullring. She’s also scheduled to compete in the ARCA West season finale Nov. 4 at Phoenix Raceway.
|Justin Campbell||17||Griffin, Georgia|
|Quinn Davis||13||Sparta, Tennessee|
|17||Mexico City, Mexico|
|Katie Hettinger||15||Dryden, MI|
|Caleb Johnson||15||Denver, CO|
|Nathan Lyons||13||Concord, NC|
|Andrés Pérez de Lara||17||Mexico City, Mexico|
|Jaiden Reyna||16||Cornelius, NC|
|Jordon Riddick||17||Sellersburg, IN|
|Paige Rogers||19||New Haven, IN|
|Lavar Scott||19||Carney’s Point, NJ|
|Regina Sirvent||19||Mexico City, Mexico|
|Lucas Vera||15||Charlotte, NC|