NASCAR’s Cup Series teams say the current economic model in American stock car racing needs to be changed and that teams and NASCAR are far apart on how revenue should be split.
23XI Racing’s Curtis Polk even went so far as to say the economic model in NASCAR is “broken.” The teams that form the Race Team Alliance spoke on Friday in Charlotte and said they want a greater share of television revenue to help their bottom lines. Teams say that they receive less than 10% of NASCAR’s total revenue.
“The economic model is really broken for the teams,” said Curtis Polk, who as Michael Jordan’s longtime business manager now holds an ownership stake in both the Charlotte Hornets and the two-car 23XI Racing team Jordan and Denny Hamlin field in NASCAR.
“We’ve gotten to the point where teams realize the sustainability in the sport is not very long term,” Polk said. “This is not a fair system.
The Race Team Alliance was formed nearly a decade ago among most of the teams at the top level of NASCAR to have better bargaining power for business deals and other negotiating endeavors. NASCAR’s current multi-billion dollar television contract is up at the end of the 2024 season and the RTA said it recently submitted a proposal to NASCAR about a different split for 2025. The RTA said Friday that NASCAR wasn’t willing to budge much on the current revenue split.
NASCAR’s teams want more money because they believe the current economic situation is untenable. NASCAR introduced a new Cup Series car in 2022 in the hopes of decreasing long-term costs for teams. But teams have spent lots of money up front as they build new cars from scratch and will likely be spending more than they imagined in the future to make safety enhancements to the cars. The 2022 Cup car has proven to be less safe than its predecessor because of its rigidity; three full-time drivers are set to miss Sunday’s race at the Charlotte Roval because of crash injuries.
Four-time Cup Series champion Jeff Gordon is now an executive at Hendrick Motorsports and he was one of the four team representatives who spoke to media members on Friday. Gordon said he had “a lot of fears that sustainability is going to be a real challenge” going forward for NASCAR teams.
Teams are fearful that they will have to make significant job cuts if the current revenue sharing system doesn’t change.
Sponsorship currently is the revenue basis for a majority of teams’ budgets. And sponsorship has been harder and harder to come by as television ratings and interest in NASCAR has been in a continual decline for the past decade. Sponsor heavyweights like Lowe’s, M&Ms, Target and Miller Coors have either heavily cut back their sponsorship of teams or left NASCAR entirely in recent years.
The decline in fan interest may also lead to a next television contract that isn’t as hefty as the current one. While live sports programming is even more of a centerpiece for television network programming, NASCAR is far from the ratings draw it once was in the early 2000s or even five seasons ago.
