Champ Car series to be placed into bankruptcy UPDATE #9 As AutoRacing1.com stated exactly one month ago Champ Car is filing for bankruptcy. ‘Merger’, ‘Unification’? One company is going out of business and the other company is cherry-picking the pieces it wants.
In the conference announcing the ‘Merger’ Tony George stated that the IRL was to be getting (buying) the state-of-the-art medical trauma center, which is a good thing, however as in any bankruptcy proceeding a Federal Bankruptcy Judge has the discretion to reverse the sale of any of the assets sold within 90 days, and under some circumstances as far back as two years, if the Court determines the sale was not at Fair Market Value or the Bankrupt company could get more for an asset.
FYI the attorneys have been working on the bankruptcy documents needed to file since at least the beginning of February non-stop. It is a huge undertaking, with certification of every debt no matter how small.
03/06/08 A reader writes, Dear AutoRacing1.com, It looks like Kalkhoven was lying through his teeth again by denying Champ Car would be bankrupted. A good friend and business associate who is unfortunately owed in the neighborhood of $350,000 by Champ Car tells me that he was told by fax that Champ Car has declared bankruptcy. Cheap bastards couldn't even Fed-Ex the bad news, they burned up 50 some pages of his fax paper to let him know he is getting screwed. Name Withheld to protect the innocent
02/14/08 Meanwhile, Kalkhoven, contacted at his California home by the Toronto Star, insisted the bankruptcy reports were "absolutely wrong."
"I have no idea where this came from," he said.
[Editor's Note: Bankruptcy was absolutely being looked at (fact), but perhaps now it is off the table.]
02/13/08 24-Hour News 8 racing analyst Derek Daly says the merger between the IRL and Champ Car is imminent and vitally important for American open wheel racing. But he adds, it will take a few years before all teams are competing at the same level.
"It will take year three, which is 2010, when everybody gets new cars before all teams have a realistic chance to become competitive against a Penske, a Ganassi or an Andretti Green.
"Derrick Walker gave me a great quote earlier today. He said for the last 13 years there have been two boats. Both have been taking in a lot of water. Now we will be in one boat but it is still taking in a lot of water," said Daly.
Daly says not to expect a merge to fix everything that's wrong with American open wheel racing. It will be a bumpy transition.
"So there will be huge fallout from this. But I have to think the short term sting will have long term benefits. That's the hope," said Daly.
Daly expects Champ Car to file for bankruptcy in the coming days. The move is a strategic one that will pave the way for a smooth merger. WishTV.com
02/12/08 Tony George was still optimistic about a plan to unify open wheel racing for 2008 following his trip to Japan to try and reschedule the race at Motegi to accommodate Long Beach. But, by the time George returns to Indianapolis, there might only be one series standing anyway. The word on the street late Monday was that Champ Car plans to file bankruptcy within the next 24-48 hours which, effectively, will end the 12-year war in open wheel. Robin Miller discusses the rumors of Champ Car heading for bankruptcy in this SPEEDTV.com article.
02/11/08 As we surmised below, word is that Champ Car or OWRS will file for bankruptcy on Tuesday to facilitate the merger with the IRL. If true, as our sources tell us, Champ Car will be out of business and there will be once again a single open wheel series in the USA and that will be the Indy Racing League.
02/09/08 We are opening this rumor back up to 'strong' from 'false' despite the statement from Kalkhoven and Forsythe that they are planning for the Champ Car season to go forward in 2008. We spotted Derrick Walker being interviewed on Indianapolis TV and in the background was his new Dallara IRL car. If the latest rumors are to be believed, four Champ Car races will be added to the IRL schedule in 2008 because they do not conflict with IRL races - Long Beach (if Motegi can be moved), Edmonton (if moved by one week), Mexico City and Australia. If true this means there are going to be a lot of lawsuits thrown at Champ Car and OWRS for cancelling races that had signed contracts.
In addition, we wonder what it means for Panoz and for the Champ Car teams that have so much inventory invested in the Panoz and the Cosworth engines. More lawsuits. And what about Champ Car's signed contract with ABC and ESPN. Still more lawsuits. And what about the Atlantic series? What will become of that? We suspect that would be retained.
We are not lawyers, but the only way we see this coming down for 2008 is if OWRS files for bankruptcy (and soon) and they let everyone sue the bankrupt company. They probably won't get much.
Despite the Champ Car fans being thoroughly disappointed with this rumored outcome, the good news is that peace will finally be at hand and open wheel racing in this country can start the long process of healing and closure.
We support a final end to the silliness of the split, and so should all the fans. 2008 will be a transition year because it is happening in the 11th hour. The sure to be bitter Champ Car fans can look forward to 2009 and 2010 when more of the best parts of Champ Car (such as the races in Toronto and Road America, and the turbo engine, etc.) can be rolled into the Indy Racing League, hence making the reunited series even stronger. We suspect some of the weaker teams from both sides will fold and some of the weaker IRL races (such as Iowa, Watkins Glen, Sears Point, etc.) will be dropped in favor of some of the stronger Champ Car races that cannot make it on the 2008 schedule. Mark C.
02/08/08 This rumor is downgraded to ‘false' based on this statement from Champ Car.
02/08/08 According to AutoRacing1.com sources, a Champ Car team just had an IRL car delivered to their shop, which is more evidence a merger may be at hand.
02/08/08 This rumor is upgraded to 'strong' today based on this SPEEDTV.com article. However, doing it for 2008 instead of 2009 or 2010 makes little sense whatsoever in this 11th hour. They could run some doubleheader weekends together this year where fans would get to see both groups together on the same weekend, however, that does not appear to be on the table. Both series have 16 to 18 cars right now. How will 34 cars fit on pit road? What about Champ Car's contracts in Europe, and the money lost on the new Panoz? What about the Indy Pro and Atlantic series? We can go on. Doing this in 2008 will prove to be very difficult, if not impossible, unless they just agree to run 5 or 6 joint races for this year but be separate for the rest of the schedule.
02/07/08 In the last two days we have been hearing rumors from a couple of different sources that merger talks between the IRL and Champ Car have heated up again and that a possible deal, if it were to happen, could be days away.
If true, we think it would not be announced for 2008 (too late for that) but more likely for the 2009 or even 2010 season. We have heard these merger rumors before, but each time the talks broke down. However, this time our sources think it may finally get done and Tony Cotman may be the guy helping it along. There are many issues to deal with - cars, engines, venues, Indy Pro and Atlantics, and a whole host of other contracts. Mark C.