NASCAR teams call revenue model ‘broken,’ warn of layoffs

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CHARLOTTE, N.C. –


The strongest teams in NASCAR warned Friday that the venerable inventory automotive racing sequence has a “damaged” financial model that’s unfair and has little to no probability of long-term stability, a surprising announcement that added to a rising listing of woes.


The Cup Series is heading into the Charlotte Motor Speedway street course playoff elimination race Sunday with three full-time drivers sidelined with accidents suffered in NASCAR’s new automotive and no clear reply as to methods to repair the security considerations.


It received a lot worse as teams went public with their year-long struggle with NASCAR over equitable revenue distribution.


“The financial model is absolutely damaged for the teams,” mentioned Curtis Polk, who as Michael Jordan’s longtime enterprise supervisor now holds an possession stake in each the Charlotte Hornets and the two-car 23XI Racing crew Jordan and Denny Hamlin discipline in NASCAR.


“We’ve gotten to the purpose the place crew’s notice the sustainability within the sport just isn’t very long run,” Polk mentioned. “This just isn’t a good system.”


The Race Team Alliance was fashioned in 2014 to present teams a unified voice in negotiations with the sanctioning physique. A four-member subcommittee outlined their considerations at a Charlotte lodge, with Polk joined by Jeff Gordon, the four-time NASCAR champion and vice chairman of Hendrick Motorsports, RFK Racing President Steve Newmark, and Dave Alpern, the president of Joe Gibbs Racing.


Hendrick and Gibbs have received six of final seven Cup Series championships relationship to 2015, however Gordon mentioned the four-car Hendrick lineup, probably the most highly effective within the business, has not had a worthwhile season in years. It will once more lose cash this season regardless of NASCAR’s cost-cutting Next Gen automotive.


“I’ve rather a lot of fears that sustainability goes to be an actual problem,” Gordon mentioned.


Led by Polk, whose position with the Hornets brings familiarity with the NBA’s franchise model, the RTA introduced NASCAR in June with a seven-point plan on a brand new revenue sharing model. The proposal “sat there for months and we instructed NASCAR we might like a counteroffer,” Polk mentioned.


He didn’t disclose the seven factors aside from noting that crew sustainability and longevity had been priorities. The committee mentioned Friday they’re open to all concepts, together with a spending cap like that in Formula One.


“We are amenable to no matter will get us to a conceptual new construction,” Newmark mentioned.


NASCAR responded to the RTA final week with a counteroffer of “a minimal enhance in revenue and emphasis on cost-cutting,” Polk mentioned.


The crew alliance was unanimous in that the one place left to chop prices is layoffs.


“We’ve already had substantial cuts. We are doing extra with lower than we ever have in 30 years,” Alpern mentioned.


NASCAR didn’t instantly reply to a request for remark from The Associated Press.


The battle over prices has been made public with 5 races remaining to crown the 2022 NASCAR champion.


The concern has simmered for years and in 2016 NASCAR adopted a constitution system for 36 automobiles that’s as near a franchise model as attainable in a sport that was based by and independently owned by the France household. The charters not less than gave the teams one thing of worth to carry — or promote — and shield their funding within the sport.


The crew enterprise model continues to be closely dependant on sponsorship, which the teams should individually safe. Newmark mentioned sponsorship covers between 60% to 80% of the budgets for all 16 chartered organizations.


Because sponsorship is so very important, teams are determined for monetary reduction elsewhere and have requested NASCAR for “distribution from the league to cowl our baseline prices,” Newmark mentioned.


The present constitution settlement expires on the finish of the 2024 season, the identical time that NASCAR’s present tv offers expire.


Although TV cash is cut up between NASCAR, teams and the tracks, the committee discovered that the worth of the teams is simply 7% whereas the tracks and NASCAR have 93% of the worth. Polk famous that in Formula One, all revenue is cut up 50-50 between the teams and sequence possession.


Mars Inc., which first entered NASCAR in 1990, late final 12 months determined this season can be its final and JGR spent the final 9 months looking for a brand new sponsor to maintain Kyle Busch, the one winner of a number of championships on the Cup degree. Busch has since signed with Richard Childress Racing and can go away JGR after 15 seasons as Toyota’s winningest NASCAR driver.


“We have change into full-time fundraisers,” Alpern mentioned. “Instead of engaged on our enterprise, we’re elevating cash simply to exist.”


Polk mentioned the teams will honor the constitution agreements by 2024. But in negotiating a brand new constitution settlement, the teams are demanding extra.


“NASCAR is a money-printing machine,” Polk mentioned. “But the teams and the drivers are those placing on the present.”


NASCAR is now beneath fireplace from almost each angle as drivers stay offended over some latest penalties and the stiffness of the brand new Next Gen automotive blamed for inflicting unprecedented accidents. What ought to have been routine crashes into the wall have sidelined each Alex Bowman and Kurt Busch with concussions, and Cody Shane Ware opted out of Sunday’s race as a result of of a damaged foot.


NASCAR has examined potential changes for the automotive and can current the findings to drivers Saturday morning forward of observe at Charlotte.

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