Editorial

The inevitable globalization of CART

 

 by Steven N. Levinson
August 20, 2001

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The next time the WTO (World Trade Organization), The IMF (International Monetary Fund) or the G-7 meet, perhaps some in the CART paddock should join the protesters and storm the barricades. Globalization is a fact of modern life, get over it!  Major corporations will seek greater and greater market share for their products; Multi-nationals will seek increased capitalization as well as cheaper labor markets. It's inevitable, and it's the law of economics, as we in the industrialized capitalist societies know it. 

Treaties like NAFTA, the European Economic Union and Mercosur acknowledge as much and are trying to seek ways only to "manage" globalization. But they cannot "STOP" it.

Tony George and those in the CART paddock who believe in an all-American racing series, are you listening? When the Europeans fist came to Indy in great numbers in the 1960's led by Jimmy Clark, Jackie Stewart, Graham Hill and others, it was the recognition by the Europeans that the INDY "500" was (1) a major International event, and (2) had great significance in the racing world beyond Europe and F1. European rear engine technology wholly transformed the skill sets required for performing well in the "500." This spelled the death knell for USAC's Dirt Trackers and Sprint and Midget drivers. In addition, the usual once a year crowd could not effectively compete with the high budgeted, high tech teams.

After that, only "INDY" was legitimized by the rest of the world beyond the USA and the USAC crowd who ruled Indy and the "MILE" dirt tracks.

Then came Roger Penske with his "Corporate Image" and his "Sunoco" sponsors, and his penchant for well-spoken drivers who could represent major sponsors in an articulate way. Penske's thorough "Professional team management approach" revolutionized INDY. And with that forever changed the race; not only the nature of the race, but the type of drivers who would now be interested in participating.

In the meantime, Formula One, under the direction of B.C. Ecclestone went from Formula Ford (Cosworth) to a global Automobile Manufacturers based series. Along with them came multi-national companies wanting to place their Corporate names and logos on the side of High Tech F1 cars in order to reach a global market that had been spawned by Ecclestone's Global TV Network. In the meantime CART convinced US based companies that they too could benefit from the same type of exposure, but on a much cheaper basis than F1. So Pennzoil, Valvoline, Texaco, Shell, Marlboro, Kool Motorola, Honda, Toyota, Ford all saw value in CART's vision. 

Then came Tony George's ill-conceived IRL, the de-valuation of the 500, the exclusion of CART Teams and engine manufacturers, and the consequent loss of TV ratings, sponsors, and the monstrous rise in the popularity of NASCAR. The revenge of the "Blue Collars," the answer to all the upper-class country clubbers. The answer to those who loved Golf and Tennis with their foreigners; and to baseball with its influx of Dominicans; and to Basketball and NFL that has a preponderance of inner-city heroes.

NASCAR found it's working class niche, and it brought in it's consumer based sponsors and loyalty to American Built "Detroit Iron". Who cared about Mercedes Benz, Honda, Jaguar, and BMW? Are there any "TIFOSI" in Timmonsville, South Carolina?

NASCAR has saturated the market, and soaked up all of the domestic sponsors. That is where we are now. Like it or not. And yet, Tony George (and some in the CART paddock) is seeking to enter into the same market already inundated with NASCAR and hopes to attract, not only fans, but sponsors. It has not happened, and I do not believe that it will happen. The families that go to Michigan Speedway with their motor home, need to pay for a parking space and an expensive NASCAR ticket "TWICE" a year. For a family of four that's a lot of money. They can't afford to spend any more.

CART has recognized this. Many sponsors have recognized this. Everyone with a vision for the future "feels" or "knows" this.

Sponsors like Motorola, Shell, Texaco who have global perspectives have also seen that CART can be a viable marketing and advertising vehicle to project their names on the "Global Market". I think that Honda (whomever they are HONDA USA or HONDA JAPAN) knows that the 115,000 people who come to Surfer's Paradise in Australia certainly get their HONDA name all over Australia and the rest of Asia during the 4 days of Honda's CART Indy Carnival. Who cares whether or not it's HONDA USA or HONDA JAPAN. The consumer and fan "down under" only see "HONDA," and this is certainly good for HONDA.  When HONDA wins in CART, do consumers in Japan, Europe, Australia or South America say, "that doesn't count, that's HONDA USA!"  Of course they don't, the consumer does not differentiate, to them it's all the same.

A win by Honda endures to the benefit of the entire Honda "Brand name". The powers that be in Tokyo are pleased by any CART Honda win, as would be the Toyota Corporate heads in Tokyo.  If not, why is Honda Corporate furious that HONDA has not won the CART Motegi race in Japan. They are exasperated by not winning. And Honda certainly wants to beat Toyota at Motegi, and vice-versa. Its up to Corporate Honda to assess each of their worldwide subsidiaries to do the "bookkeeping" and assess each for the total costs of the program! 

If what we have read from Robin Miller is correct, that Pharmaceutical Giant Eli Lilly is going to sponsor Newman-Haas in 2002, then they too have recognized the value of CART. That CART's global approach is where they want to spend some of their advertising budget. They must believe that they will get a bigger "bang" for their advertising budget, and reach more people "globally" with CART than by going with NASCAR domestically, or with the IRL who's markets only extend to the perimeter of the Midwest with nearly all of it's tracks located within a 300 mile limit. 

If you were Lilly, would you want to market in Montreal, Mexico City, Brazil, Australia, Japan, England, Germany and soon to be China, or go to small markets like Colorado Springs, Nashville, Richmond, Virginia? Wait, I know what you're thinking. What about Indy? Well, they can do that too with a professional and technically strong team like Newman Haas. 

It is CART's job to convince more and more multi-national sponsors who want to sell to the "Global Market" that CART (1) is the place to spend their money, (2) that it's a "bargain" compared to F1, and (3) that sponsorship monies must be shared amongst all marketing/Ad budgets from their various worldwide subsidiaries.

The globalization of CART is inevitable, and the sooner everyone in the CART paddock comes to terms with that, the sooner CART can realize its true potential.

The author can be contacted at contacts@autoracing1.com

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