Just two years ago, Kmart sponsored two Winston Cup teams. Today, they are out of the sport. Credit: ASP
By Marty Smith, Turner Sports Interactive
August 6, 2003
3:12 PM EDT (1912 GMT)
When Britney Spears' net annual income can hardly cover the going rate for a 38-race Winston Cup team sponsorship, it has obviously reached the point of absurdity.
Actually, forget that. It's long past absurd. Fifteen million dollars? It's no wonder mainstays like Pennzoil and CITGO are bowing out.
Heck, for 15 large Pennzoil could buy advertising space during every quarter of the Super Bowl, vastly upgrade Sam Hornish's IRL effort and have enough left over to buy Arnold Palmer a spiffy new tractor.
It's simple math. Spend $15 million and run in the back, and there's no return on the investment.
In recent years, several corporations have experienced the number crunch, and subsequently been priced out of the game: STP, Skoal, Michael Holigan.com, Heilig-Meyers, Phillips, Circuit City, Cartoon Network, Paychex, Firstplus Financial, Primestar, Tabasco, Kodiak, BellSouth, HotWheels, Remington, Square D, Exide Batteries, Hills Brothers Coffee, K-Mart, Sprint, 10-10-345 and now Hooters and UAW-GM.
And I'm sure I forgot a few. As if that's not bad enough, NASCAR has now turned up the enforcement wick regarding who can and can't sponsor race teams. AT&T was Jeff Burton's savior, but NASCAR and Nextel disconnected the rival communication company's sponsorship union with Roush Racing.
Costs for teams are spiraling out of control, and several top teams are looking for sponsors for next year. What can be done to level -- or even reduce -- team budgets?
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Several remedies come to mind for me, but I'll focus mainly on the three I deem most feasible. First, cut the length of several races. Five hundred laps at Martinsville is absolute overkill. Cut it to 300. Five hundred miles at Pocono, twice in a month's time? Please.
Aside from a handful of select events, most every race on the slate could stand to be abridged a bit. By shortening up the duration of the events, teams would save thousands of dollars just on tires and fuel each week. Plus, you guys wouldn't be so apt to catch that catnap between laps two and three hundred.
My second major cent-saver is simple: cut out testing completely. No single money-saving venture would be quicker, easier or more feasible, and save teams so much money.
NASCAR currently allows teams five tests at sanctioned tracks, which doesn't seem overly financially strapping until you consider that non-sanctioned tracks are fair game at all times.
From Lakeland, Fla., to Sparta, Ky., to Greenville, S.C., and everywhere in between, small niches of America will host at least one Winston Cup Series team almost every day. Cut it out, and you'll save hundreds of thousands of dollars.
According to one Winston Cup crew chief, an average test session runs $25,000. The team plane is $1,500 per hour, so for a two-hour flight to Kentucky you're looking at $6,000. Ten hotel rooms will run you $1,500. Add $10,000 for tires, $350 for fuel, $800 for rental cars, $500 for transporter expenses, $2,000 for supplies and $10,000 for track rental, and you're at $31,150.
And you haven't even paid your guys yet.
For the heck of it, let's say teams go to Kentucky -- the current 1.5-mile testing ground of choice -- five times a year. Cutting that out alone saves them nearly 200 grand. And that's just one track.
My third remedy is a bit far-fetched. Matter of fact, it's probably impossible since the current television contracts are inked through 2006. But maybe if I drop the hint it could be explored during negotiations for the next gabillion dollar television package.
To me, the manner in which the television money is doled out doesn't exactly add up. The tracks get 65 percent of the dough, while 25 percent goes to the race purses and NASCAR takes a cool 10 percent off the top.
My issue is with the tracks. Though I'm fully aware of the hefty upkeep expense -- re-paving, etc -- and the sizeable debt acquired when building a $200 million facility, 65 percent seems a rather generous portion of the pie for the venues to take home.
You can have the grandest track in the land, but without teams there is no race. And without a race, you're never paying off that debt.
STP43: 1 -- Limit number of racecars -- This is similar to an old ACT/Coors Tour rule -- no "Bristol cars," "Rockingham cars," "Texas cars," etc. One general-purpose superspeedway car, one general-purpose short track car, and a backup for each.
2 -- One engine/one setup rule -- ban soft/qualifying setups, mandate a minimum spring/shock/swaybar weight; do not allow any changes to the car except wedge and spring rubbers after qualifying; ban any engine tuning after qualifying -- if you break any of those rules, you serve a five-lap penalty at the start of the race.
3 -- Make teams open their books -- the sport will never be able to fully solve its problems until teams fess up on where they are spending their money -- Dave Marcis said in American Zoom that he is willing to open his books to NASCAR to show them how expensive it is.
4 -- Limit crew size to seven -- no engine tuners, engineers, or hired-gun pit crews at the racetrack; crewmen registered at start of the season to prevent rotation.
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5 -- Implement a team spending cap, at $8 million per year; hire a salary cap specialist from the NFL to study and make more effective a spending cap on race teams.
6 -- Enforce the two-team limit already in place -- do not accept entry blanks for teams above the two a team owner already fields; make teams prove that they are not connected in any way to another organization i.e. that Papa Joe Hendrick's team does not use Rick Hendrick equipment but outside equipment.
7 -- Harden tires to reduce need to change tires -- tire bills are huge, and teams need to be limited to five sets of tires for an entire weekend.
8 -- Increase minimum weight for engine parts -- teams still use lightweight (and more expensive) parts in engines; they should not be allowed to use such.
The King lives! Albeit in Never Never Land. Though many of Gas Treatment's ideas are excellent on paper, few are truly feasible at this time. One aspect of this business I've learned a lot about by talking to crew chiefs is the absurd expense that coincides with change.
Even the slightest rules change can virtually break the bank. Every time NASCAR mandates a body alteration, the expense incurred on teams is far from pocket change. Hence, NASCAR often moves at a snail's pace when contemplating such costly mandates.
Limiting the number of cars built and/or setups utilized takes far too much strategy out of the industry. And while it might seem a salary cap would offer a viable solution, that's not the case in motorsports.
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| How much testing is needed? Credit: Autostock |
Unlike stick-and-ball sports, policing team spending in motorsports is virtually impossible. There are too many variables. The stick-and-ball boys have a salary cap on player salaries, not equipment or performance enhancement benefits.
It's apples and oranges, folks.
Opening the books? Welcome to Never Never Land, Richard.
CDN_24_Fan: A big part of a team's budget goes into the four restrictor-plate races...The more the teams spend and work at defying physics, NASCAR steps up to the "plate" and slows them down with either a smaller plate or roof air dams. Once NASCAR makes a rule change, all of your past work and the money spent developing bodies and engines gets thrown in the garbage.
Why doesn't the Cup series look at reducing the size of the engines from 358 cubic inches? Smaller engine means less power...less power means slower speeds. By eliminating restrictor plates, teams would be able to use conventional technology in their engine shops which will save money. Also, the racing at Daytona and Talladega would actually be worth watching. The proof is watching the Craftsman Truck Series with no plates run at these tracks.
Curley Neal brings up an excellent point with the restrictor-plate argument. Word in the garage is that one big money organization -- give you one guess -- employs an entire division devoted solely to plate racing development, i.e. making the most horsepower possible with a restricted engine and finding creative new ways to reduce drag (wind resistance) on the bodies.
Talk about pricey. When all is said and done, a plate motor costs upwards of $125,000. Smaller engines, it seems, would cost more because teams would still be developing unique motors solely for superspeedways.
Regardless of your feelings towards restrictor plates, they're currently the best way to combat superspeedway speed.
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| Could a tire limit be the answer? |
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Go_24_48_97: hey who says you need to eliminate anything?? is there a set rule on the number of cars per owner?? is there a rule what tests and wind tunnels you must do?? sounds to me like these teams need to make wiser decisions on spending. all this will turn into is another "gentleman's agreement" issue. that's all we need eh?? we could also reduce the number of races?? NOT!! bad for the fans!!! let the teams make their own wiser choices anyway...seems testing in some cases doesn't help teams. reduce budget?? spend wiser!!
Interesting viewpoint, Jimmie-Jeff Busch. Hire more competent CFOs. I'll buy it.
Side note: Jimmie-Jeff Busch is an AWESOME race fan name. Straight out of Walton's Mountain.
Pokey: I can think of quite a few ways these guys could save money. One way would be a tire limit, like the Busch cars have, not only would this save money, I bet the racing would be better too. What about condensing the weekend, instead of qualifying Friday, why not do it Saturday, and race on Sunday, one less day at the track has to save some money.
Condensing the weekend schedule is ingenious -- but only on stand-alone weekends.
Open the gates at 6 a.m. on Saturday, go through inspection, practice from 10-12, tune the cars for an hour, qualify at 1:30, have Happy Hour from 4-6 and close the garage at 7. Show up Sunday and race. Sure, it'd have to be tweaked at some places -- Talladega -- but it would be quite functional at most venues.
The tracks would lose a full day of souvenir/concession sales, but it'd save the teams both money and energy, and would help alleviate the strain of the marathonish schedule.
Jstue02s: While there is no easy solution to this problem, mainly because you are going to tick of somebody and only please a few...an interesting way of doing it is by following what institutions like the Federal Reserve Bank does. Don't force teams to budget or say they can only spend so much on this and so much on that...simply limit the flow of money.
Create a system of maximum sponsorship caps on several levels (i.e. $3 million for primary $1 million for secondary and so on). That way everyone has the potential to get the same amount of sponsorship money. You set it low enough so that the sponsors will be willing to pay it on a yearly basis yet high enough where owners can pay the shop guys and various other business expenses within reason.
Reduce the amount of money flowing into the system would level the technological advances and help in the goal of equality in equipment allowing the races to be solved by who is the better driver and not who has the deeper pockets.
Whoa. Alan Greenspan took it to a whole new level, one that happens to be way above my head.
tylerbac: To me, go to a form of a spec engine for each of the manufacturers would reduce costs a ton. Remove all testing, period. Reduce wind tunnel time. Limit tire use on a weekend.
Some of the expense the teams have brought on themselves. Have you ever seen the gorgeous buildings that house the top-level teams? High-end teams have a special car for each type of track. An engine package with a different power band for each type of track. But, let us all remember that this is supposes to be the pinnacle of stock car racing. Should there be a limit? hmm.
Many folks cited the Busch Series' tire-limit rule as a feasible cost-cutter for Winston Cup teams. It would be, but would have to be modified simply due to the fact that Cup races are twice as long as Busch races.
This is the pinnacle of stock car racing, after all, and the money flows like a raging river.
And there's no dam in sight.
Marty Smith is NASCAR.com's senior writer. The opinions expressed are solely of the writers.
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