NASCAR admits Cup series teams are ‘losing money’
NASCAR has been introducing new policies to make racing financially sustainable.
2023 Chicago Street Race (Via IMAGO)
Motorsports is one of the costliest sports to compete worldwide. The drivers have to spend a ton of money to climb the ladder and earn a seat to race in the top tier. The teams on the other hand also need to work to fund their operations by roping in sponsors and other methods to keep being competitive.
NASCAR is no exception as the teams are racing, in the words of Joe Gibbs Racing veteran Denny Hamlin, they are racing Lamborghinis in the Cup series. In a championship with over 36 races a year, it is a tough job to break even. For the small teams, the task becomes harder as they lack the resources the big team can afford.
NASCAR President Steve Phelps during a webinar Monday talked about the same and revealed that the Cup team is losing money and needs a path to profitability. He admitted that it’s an issue that needs immediate attention. Teams can’t sustain themselves for long with just sponsorship money and NASCAR needs to step in here.
They want to have a path to profitability. That’s not a check right now. It’s not. Our race teams by and large are losing money at the Cup level. That is something that we need to solve for. You solve that with two key pillars.Phelps said, as reported by NBC.
How to solve the profitability issue
Phelps has also explained the two key pillars of solving the lack of profitability. He pointed out that one way to solve it is to get more additional reviews for the team, which they expect to get from NASCAR as part of the race purse. Phelps said that it’s something NASCAR has to do and he believes it can be achieved by a better media rights deal.
One is to make sure that they’re getting additional revenue. So, they’re interested in getting more revenue from the sanctioning body and the tracks through the purse. That is something that we need to do. The only way you can do that is to have increases in your media rights, which is what we’re doing today.
The second pillar he sees in fixing the issue is cost cutting. The Next-Gen cars were introduced in order to reduce the cost of racing and he want to make it more affordable for the teams. But that doesn’t mean the sanctioning body wants teams to cut their way to success.
Second and not small, honestly, is some type of cost containment. So, whether that’s in the form of a cap, or whether that’s in the form of the parts and pieces that make up the Next-Gen car, or trying to limit those pieces…