What’s holding IndyCar back?

Why is it that the IZOD IndyCar series is still struggling for survival? Why are already anemic TV ratings flat or down? Is it the racing?

Well, other than the train wreck of Belle Isle, the racing has been phenomenal. Arguably, this year has been the most compelling in recent history, with championship likely to go down to the 500-mile finale in Fontana. Furthermore, despite a merely “solid" effort in Edmonton, Ryan Hunter-Reay, an American, is leading the points race (3 wins in a row helps explain this). So what is the issue?

Sadly, the problem remains the same as it’s been for decades: Management. Now, this is NOT a call to fire Randy Bernard. While his mistakes will be chronicled, he is hampered by a lack of funds from the Hulman-George Board, feuding, self-interested owners and the legacy of a destructive split. In truth, the egos and divergent interests might be the final nail in this sport’s coffin. The last 2 months are instructive.

Shortly after a thrilling Indy 500 (which could have been a catalyst), the chaos was laid bare. As Bernard himself confirmed (perhaps rashly), at least one owner (though likely more) tried to get him fired. The issues seem(ed) to be costs (esp. for spare parts) and overall management issues. More accurately, it was a disgusting, contemptible power grab by a group (owners) too self-interested to be allowed to run the sport.

While the coup was put down, Bernard did himself and IndyCar no favors by first canceling the China race (utterly predictable, given Champ Car’s Asian failures), promising a “Plan B," then ending up with no replacement. The event was basically an $8 million money grab that, in the end, earned the series nothing. While rushing a replacement might have been strategically unsound in the long-term, Bernard all but promised it. To then back out of it appears amateurish.

Around the same time, we learned that, in all likelihood, the “aero kits" (meant to differentiate the cars and tweak the aerodynamics) promised to the fans for 2013 will be delayed… again. Why? Well, while the new DW12 IS a relatively good bargain as a new purchase, Dallara is using spare parts and replacement parts (over which they hold exclusive control) to make up the difference. In so doing, teams feel gouged and costs have escalated. Teams feel they cannot afford it. Because of that, fans get shafted again.

If you’ve noticed that money is a theme here, well, nice catch. Obviously, the split gutted this sport’s popularity and revenue streams. Most casual race fans made the reasonable choice to simply follow NASCAR after the split blew up IndyCar. With that exodus, the exit of sponsorship money soon followed. Neither one has truly come back.

The problem is further exacerbated by the tightened purse strings of the Hulman-George Board. During the Tony George-led IRL years, the H-G family reportedly lost $600 million, so one can understand some reluctance to spend money. But their diktat to Bernard not to lose ANY MORE money is terribly shortsighted and myopic. By doing so, they have limited Bernard’s ability to negotiate with tracks, TV partners and even race teams.

Unification is only four years old and closing the purse strings so tightly has made it fragile. Make no mistake, the goal must be profitability and the series could not continue to burn money as it had been, but in order to make money, well, sometimes you have to spend money. Whether it’s lower sanction fees, indirect help to teams, or other efforts, a few chances need to be taken and a few dollars need to be spent.

So, is that the final answer to IndyCar’s woes? Not by a long shot, but that is another post altogether. The Examiner

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