NASCAR teams eyeing organizing their own races (3rd Update)
“The dialogue continues between NASCAR and (the negotiating committee). A lot of the same issues are still the same issues we’re working through,” RFK Racing president Steve Newmark, a member of the negotiating team, told Motorsport.com.
“There is a model that works for everybody which actually helps take the sport to the next level. There’s just a lot of pieces and we have to figure out how to get there.
Newmark said an improved racing product combined with increased TV ratings in recent seasons should help produce a bigger media deal.
“The sanctioning body, the tracks, the teams, the drivers – you have to have all of them working together and rowing in the same direction,” he said. “The issue right now is the teams, from an economic perspective, are struggling. Our financial model doesn’t work but the sport is still thriving,” meaning the France family is getting rich on the backs of the teams.
It remains to be seen what small bone the France Family throws to the teams to get them to go away and shut up.
December 26, 2022
The France Family has no intention of letting teams organize off-season races not sanctioned by NASCAR, and they will schedule more Cup races and make the season even more onerous for teams. There is no way they will let anyone break their complete money-making monopoly of stock car racing.
During a recent Pit Reporters podcast, long-time racing reporter Lee Spencer stated that to boost media money, the sport’s governing body might try to get around that by expanding the schedule from the current 36 points races to 42 races starting in 2025.
Spencer said:
“You’ll probably need the additional partners just to pony up the cash to make it work. I’m hearing 42 (total) races. I think they set that up for the new TV schedule to give a little piece of the pie to everyone.”
The broadcasting rights of NASCAR’s top-level series are currently held by FOX and BNC.
“I’ve got to say, over the last 10 years, I don’t see teams working as hard to get sponsorships. I don’t see tracks working as hard to get sponsorships. To me, that’s gravy, whatever they bring in – more so for the tracks and the teams.”
“But in the last 10 years, we have seen teams go from working exceptionally hard to bring in sponsorship dollars to bringing in half-assed drivers that either write a check or bring a sponsor with them. And that dilutes the quality of the product on the racetrack. So, I kind of put it back to the teams to find competent sales people and marketing people to go out and sell.”
December 5, 2022
More detail on how the France Family gets rich off the backs of the poor race teams.
The lucrative NASCAR TV Contracts with Fox and NBC bring in $8.2 billion over 10 years (2015 to 2024), or $820 million per year split between the tracks, the teams and NASCAR.
The teams carry the majority of the expense to go racing almost every weekend yet only get 25% of the TV money split between all the teams.
What the teams get: $820 million/36 cars x 25% = $5.7 million per car per year
What the tracks get (France & Smith Families): $820 million 65% = $533 million/38 events = $14 million per event
What NASCAR gets (France Family): $820 million 10% = $8.2 million per year
It costs competitive NASCAR teams at least $10 million per car per year, so the $4.3 million gap must be made up with sponsor money, which is becoming harder to get as the current administration races the country into a recession.
The teams feel the tracks are getting too large a percentage of the pie and want a piece of that $14 million TV money the tracks get for every race.
Tracks also get ticket revenue. If a track has attendance of, say, 75,000 @ $100 per ticket = $7.5 million per race plus concessions and race title and track signage money.
All total, tracks are bringing in around $30 million per race in revenue (rough number). They have sunk amortized costs in the facility plus a staff to maintain the facility – painting, mowing, administration, security, repaving every 10 years or so, cleaning, taxes etc.
The France Family net worth is estimated between $3 and $5 billion but they own the majority of the tracks, which, if sold, would bring them many $ billions
If the France Family were to sell NASCAR and all its tracks, they would likely reap a windfall estimated of $50 to $100 billion.
With a new TV deal set to begin in 2025, the race teams are threatening for a bigger percentage or they will stage their own races…..they say in the off-season, but what about midweek races?
Think it can’t be done? Tony Stewart started the SRX series as a small example of what can be done.
November 30, 2022
NASCAR teams are reportedly considering participating in offseason exhibition races that are not sanctioned by NASCAR because they are struggling to make it financially. In NASCAR, the France Family keeps most of the profits for themselves, and they make the teams race most weekends so they can sell more tickets and make more money.
Meanwhile, the teams are sucking wind.
Sports Business Journal‘s Adam Stern reported Tuesday that the Race Team Alliance, a coalition including the 36 NASCAR race teams with charters, has instructed renowned marketing agency Wasserman “to explore exhibition race opportunities, both domestically and internationally.”
Wasserman Managing Dir of U.S. Will Pleasants confirmed to SBJ on Tuesday that the agency has “been hired to explore exhibition race opportunities, both domestically and internationally, via a (request-for-information proposal) — very exploratory.”
The RTA is a coalition of NASCAR teams who come together to meet and address issues and opportunities in the sport. Every team that owns one of the sport’s 36 charters are now RTA members. Wasserman was already working with the RTA to help the coalition understand its media value heading into NASCAR’s upcoming rights cycle, for which formal negotiations will start in early 2023. The exhibition exploration is a new, incremental addition to the deal for Wasserman.