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DATE News (chronologically)
01/05/10
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NASCAR Souvenir and Collectable industry a bust  The dictionary defines a collectible as any item saved for a hobby, display, or as an investment whose value may appreciate. If you are a race fan with a large collection of NASCAR diecast, clothing or other related items, you’d better forget the appreciable investment part of this definition.

Like those who have lost significant personal housing and retirement wealth with the recent economic downturn, NASCAR memorabilia collectors have taken a direct financial hit. Thanks to an overproduced, massive glut of inventory, overinflated prices and now a soft economy, the NASCAR collectible market is a bust.

The latest indication of that fact came last week when Motorsports Authentics – the top producer of NASCAR team diecast and clothing in the sport - filed an extension with the United States Securities and Exchange Commission.  Jointly owned by Speedway Motorsports Inc. and  International Speedway Corporation (NASCAR’s parent), Motorsports Authentics is on the verge of bankruptcy losing more than $20 million in the final nine months of 2009.

MA’s recent financial hemorrhaging is just the latest round of bad news for the company which was created in 2005 when SMI and ISC spent nearly $250 million to buy the then struggling Team Caliber and Action Performance companies. Since then, Motorsports Authentics has been a huge cash black hole losing $7.878 million in 2006 and $42.975 million in 2007 (not including a massive business write down of $69.499 million that year). The company then turned a small $3.199 million profit in 2008 before the wheels completely came off last year.

Motorsports Authentics indicated in Wednesday’s filing that the company has an additional $23.4 million in guaranteed debt still to be paid – including seven-figure sums to several top NASCAR teams including Roush-Fenway, Dale Earnhardt Jr., Hendrick Motorsports and Stewart-Haas Racing. Much of the company’s financial issues are reportedly tied to large quantities of unsold Earnhardt, Jr. merchandise and a bankruptcy filing could cost SMI alone upwards of $12 million.

The problems at Motorsports Authentics are just the latest in the long troubled NASCAR souvenir industry.  When it exploded on the scene in the middle 1980’s, the new NASCAR collectible market was a cash cow for top stars like Dale Earnhardt, Darrell Waltrip and Rusty Wallace – drivers who quickly realized they could make untold millions of dollars off the track hawking everything from toy cars to toilet paper. More at closefinishes.com

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