SBJ/May 8-14, 2017/Franchises

NASCAR teams focused on ways to cut costs

Teams have spent large sums to build faster air wrenches to gain an edge during pit stops.
Photo by: GETTY IMAGES
After implementing the sport’s charter system last year, NASCAR teams are now focusing on another big topic: lowering the cost to compete and making races more exciting.

The charter system gave team owners a form of enterprise value and established a new governance structure to give them a greater say in proceedings. But it didn’t solve the issues of spiraling costs and reliance on ever-scarcer sponsorship dollars that continue to make the team owner model a challenging one.

Through the team owner council that meets with the sanctioning body, teams in recent months have been examining what parts of cars, or of the wider competition itself, should be changed to lower costs, improve the show or, in some cases, both. The discussions, which had not been reported, include narrowing the options of where teams could buy parts and, with some parts, possibly with only a single supplier.

Moving to more spec, or universal, parts could save teams money and help NASCAR officiate the sport more efficiently. Teams would be forced to use the same part, instead of spending large sums on research and development. For example, some teams have spent heavily in recent years to develop a quicker air gun so they can change tires faster during pit stops.

“What I would confirm is there is a bigger discussion within the industry about, ‘What areas do we want to compete in that makes the show exciting, enhances the fan experience, highlights the talents that we have as a sport? And which areas are less important and are more support functions?’” said Rob Kauffman, chairman of the Race Team Alliance and co-owner of Chip Ganassi Racing. “[The idea is to] spend our resources on things that improve the show and increase excitement, and don’t spend as much or focus as much on things that are purely support functions.”

The budget for running a car in the Monster Energy NASCAR Cup Series for the whole season can range from mid-seven figures for lower performing teams to closer to $20 million for top cars.

Theoretically, making the competition less about differences in car parts and more about the difference in the skill level of drivers and crew members could increase parity in the sport.

On top of examining pit road dynamics like the air gun, sources said that parts of the car being examined include the rear suspension. Multiple teams have spent significant sums in recent years to gain an edge in that area of the car, which can help them turn quicker through corners.

Parts of the car or competition that already are spec include the engine control unit, which is sold to teams by McLaren; tires, which are supplied by Goodyear; and fuel, which is supplied by Sunoco.

“The cost of going to the racetrack has gotten out of hand, so this is going to make it healthier as teams can compete better, stay in business, keep their employees and not lose money,” said Greg Fornelli, owner of SRI Performance and Stock Car Steel & Aluminum, which supplies NASCAR teams with car parts. “If we’ve got a business model that makes sense where it’s not just wealthy people who don’t care if they lose three to four million a year, then I think it’s good for the sport.”

One of the biggest hurdles of the latest initiatives is getting the sport’s top teams to get on board with the effort, sources said, because their success leaves them in less of a rush to change the sport’s structure. A source said owners who had shown resistance included Gene Haas and Joe Gibbs. A separate source added that many of the sport’s bigger teams have come around to the idea over the last year or so, considering the challenge in landing adequate sponsorship dollars.

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