France: NASCAR working to weather economic storm

AVONDALE, Ariz. -- NASCAR chairman Brian France has met with executives of struggling U.S. automakers and is prepared to aggressively cut costs, all in an effort to weather an economic downturn that has crippled many of the manufacturers and corporate sponsors that fund race teams in the sport's national divisions.

Concern grows

When GM announces huge losses in uncertain times, it's enough for everyone in the garage to take notice.

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France said he and NASCAR president Mike Helton have met in recent months with CEOs or top executives of all four manufacturers that compete in NASCAR -- Ford, Chevrolet, Dodge and Toyota -- to gauge how the current economic situation is affecting their commitment to the race teams that bear their respective nameplates. Domestic manufacturers in particular have taken a hammering; General Motors, Chevrolet's parent company, recently announced third-quarter losses totaling $4.2 billion, and is running short on operating cash. Ford reported losses of $2.9 billion, and the company's share is trading at a near-record low.

Sunday at Phoenix International Raceway, France said he hoped that the manufacturers would pull out of the nosedive. But should one go bankrupt, he added, the sport would still survive.

"The manufacturers, they play a very important role in a lot of ways," France said. "The direct support to the teams, that's important. The branding and the heritage, they're part of the sport in a very unique way. We're proud of that, and it's part of our history. But we're also not going to live or die if one manufacturer or another manufacturer has a pullback or a pull out. I hope it doesn't happen. We're working like mad to make sure it doesn't. It wouldn't be our first choice by any stretch. But the sport is on very, very solid ground that transcends one manufacturer or another."

Manufacturers aren't the only ones in financial difficulty. Fewer than 30 cars on the Sprint Cup tour have locked up full-time sponsorship for next season, leaving many operations still unsure about backing for next year. The waning weeks of the 2008 campaign have seen a noticeable lack of sponsorship announcements, usually ubiquitous this time of year as teams secure deals for the following year. France said that's only indicative of the larger economy as a whole.

"Quite frankly, and we'll see how the economy sustains as far as how bad it gets, but we may come out of this better than most, even thought it's hard sometimes to see that," France said. "We're all sensitive to a team owner who's really struggling, who ought to have sponsorship. But we can't expect to operate as an island and be oblivious to what's going on, where companies are pulling back on every form of advertising, marketing, and promotion they're doing, and then go, 'Well, the NASCAR guys, we're not going to cut back anything there.' That's unrealistic. The idea that we can have a safety net for everybody in our industry, wish we could, but that's not practical."

Sponsor squeeze

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Yet to try and ease some of the financial burden on those team owners, France said NASCAR needs "to be more aggressive than we've ever been at taking cost out of the system." He didn't provide specifics, but hinted that cost-cutting could be partially addressed with a more limited testing policy. The Craftsman Truck Series, which Ford recently pulled out of, is another area of interest.

One thing that won't change -- the way NASCAR does business. From manufacturer pullouts to fuel crises, France said the sport has faced and survived difficult economic times before.

"Look, this isn't the first tough economic times we've been through," he said. "We've been in business for 60 years. We've seen the energy crisis in 1972, we've seen the bubbles and the difficult times, there's no question about it. We've seen 9/11 and the tourism industry was basically shut down, and the airline industry. This is a very big economic downturn, but we're not going to change our business model because we're in tough economic times. That doesn't mean we won't be more aggressive taking out costs for team owners, doing everything we can."