Month: September 2024

By David G. Firestone

I’ve got a couple of stories this week about IndyCar. Sadly, neither of them paints the series in a good light. Last week, I discussed the new NASCAR charter system, and the seemingly never-ending series of issues it seems to cause. It’s been like that since the beginning, and it just keep getting worse. It all came to a head when NASCAR pretty much strong-armed the teams into signing the new charter, which all but two teams did.

Well, what better time for IndyCar to announce their own charter system? On September 23, IndyCar announced the formation of a charter system. According to IndyCar.com:

“INDYCAR confirmed today the establishment of a charter system across the NTT INDYCAR SERIES. In total, owners of 10 teams have accepted charters for 25 entries competing in North America’s premier open-wheel racing series, beginning immediately.

“This is an important development that demonstrates an aligned and optimistic vision for the future of our sport,” Penske Entertainment Corp. President and CEO Mark Miles said. “I want to extend my sincere appreciation to our team owners for their collaboration and ideation throughout this process. Ultimately, we’re pleased to have a system in place that provides greater value for our ownership and the entries they field.”

This is the first charter system to be introduced in the history of the NTT INDYCAR SERIES. A chartered entry is guaranteed a starting position on the grid at all NTT INDYCAR SERIES races, excluding the Indianapolis 500 presented by Gainbridge. An entry also must be chartered to qualify for the annual NTT INDYCAR SERIES Leaders Circle program – an annual award program that compensates the 22 top finishers in the prior year’s NTT INDYCAR SERIES championship. The terms of the initial, long-term charter agreements are committed through the end of 2031.”

The next day, IndyCar also issued a self-asked “Q&A” about the system, but that really didn’t add much. Racer.com and Marshall Pruett actually gave some more information:

“The charter creates an exclusive club for the NTT IndyCar Series’ season-long entrants, the first of its kind for IndyCar — different to the franchise system from the former CART IndyCar Series — that provides its members with a range of benefits, including the ability to sell or seek investors in their charters.

Penske Entertainment retains permanent ownership of each of the 25 charters that were distributed. With its approval, which also includes receiving a percentage of any sales, Penske will welcome new entrants to the series, or the sale of charters from one member to another, which grants guaranteed participation in every IndyCar race for those who ‘own’ charters, barring the Indianapolis 500.

The structure is an important one for the 10 teams as each of their two to three charters bring a new monetary aspect to participation in the series. Prior to the charter, teams entered and left the series at will, and in the case of teams that were voluntarily shuttered or simply went out of business, they had nothing of significant value to sell, other than their cars and racing equipment, to recoup their losses or profit from on their way out of IndyCar.

As RACER has chronicled throughout the year, the charter — which runs through 2031 — uses a numerical structure of 25-22-3.

The number 25 was selected as the total amount of charters to be created. The number 22 refers to the decades-old Leaders Circle program, which pools the majority of each season’s prize money and splits it evenly across the top 22 entries in the annual Entrants’ championship. Where every team that participated in the most recent season was eligible to receive a $1 million Leaders Circle contract, only the teams with charters are capable of securing contracts starting in 2025.

Of the 25 charter entries, the top 22 will continue to get the $1 million contracts, leaving the three lowest charter entries on the outside of the Leaders Circle payouts; the process resets at the start of each new season.

The Leaders Circle program is not a profit-sharing system. Teams, despite receiving money from the series for being in the top 22, have had no ownership stake in Penske Entertainment to receive profits from, nor does the new charter program come with an ownership component within the company for the 10 teams.

A maximum of three charters per team have been released, with the results of the 2023 IndyCar Entrants’ championship results being used by Penske Entertainment to determine which teams and how many charters would be given to those teams.

The breakdown of charters per team starts with AJ Foyt Racing (2), Andretti Global (3), Arrow McLaren (3), Chip Ganassi Racing (3), Dale Coyne Racing (2), Ed Carpenter Racing (2), Juncos Hollinger Racing (2), Mayer Shank Racing (2), Rahal Letterman Lanigan Racing (3), and ends with Team Penske (3).

The last number of interest is 27, which will be enforced starting next season as the new entry limit per race, except for the Indy 500, but RACER has confirmed the 27-car cap is not contained within the charter. If it had been included in the charter, Penske would have been obliged to honor that number through 2031.

By leaving it out and making it the domain of IndyCar’s sporting regulations, the series’ parent company has given itself the latitude reduce the cap in the coming years to no more than 25 cars — to match the number of charters – which is expected throughout the paddock.”

First off, the timing of this announcement could not have been worse, given the issues and “resolution” of the NASCAR Cup Series charter negotiations. Did this announcement really need to be announced when it was with all of this bullshit going on? You really couldn’t have waited a couple of weeks for the official announcement?

Second, does IndyCar see what is happening in the racing world and think “This idea suck, let’s make it worse?” I challenge anyone to find those in NASCAR who have anything good to say about the Charter system. It was a terrible idea, it was poorly implemented, and it didn’t really help the smaller teams, given how many charter teams have gone under since its inception. Even the top teams in the sport are struggling to turn a profit under the old system, and I fail to see this new charter having any other effects.

Except that the revinue-sharing aspect. Going back to the Racer.com article:

“The Leaders Circle program is not a profit-sharing system. Teams, despite receiving money from the series for being in the top 22, have had no ownership stake in Penske Entertainment to receive profits from, nor does the new charter program come with an ownership component within the company for the 10 teams.”

Unless there is some details which haven’t been made public as of the time of writing, there doesn’t seem to be any financial gain for the teams with this new charter system. I could be wrong here, and if I am, I apologize, but outside of some guarantee spots and something called the “NTT INDYCAR SERIES Leaders Circle program.” To quote another Marshall Pruett Racer.com article, this one from July:

“With Penske Entertainment’s guaranteed prize money distribution system — one that was devised in the mid-2000s by the Hulman George family, the former owners of the series — the top 22 entries in the final standings are eligible to receive the contracts worth approximately $1 million apiece.

The Leaders Circle structure limits eligibility to a maximum of three cars per team, which only affects the five-car Chip Ganassi Racing squad, so outside of CGR’s No. 4 entry for Kyffin Simpson and the No. 11 for Marcus Armstrong, its other three entries, along with the full-time cars at IndyCar’s nine other teams, are in play for those 22 payouts next year.”

Again, unless there is something I’m missing here, there really isn’t that much to gain from this new charter, except guaranteed entries to races. So what’s the point? Remember that of the 25 charted cars, only 22 can be part of the Leaders Circle, so three teams are getting hung out to dry. Also the guaranteed entry into the Indy 500 doesn’t really make sense, since it’s rare that any of the top teams fail to qualify. So, again I ask, what’s the point here? If there is some financial gain from this system I could agree with it, but the one thing that makes the most sense seems to be absent. I hope that I’m wrong, but this makes no sense.

Speaking of bad press and bad looks, IndyCar was also dealing with more serious issues. On September 18, 2024, The FBI raided the headquarters of Rahal Letterman Lanigan Racing shop in Zionsville, Indiana. According to Marshall Pruett and Racer.com:

“The Federal Bureau of Investigation dispatched agents to the Rahal Letterman Lanigan Racing shop in Zionsville, Indiana on Wednesday morning.

The FBI is alleged to have instructed employees within RLL to leave their computers and related electronic devices in place, gather their belongings, and depart the building as agents began an investigation.

The source of the investigation is alleged to involve a former employee of the Andretti Global IndyCar team, who left the team to join RLL in a senior engineering role, and the alleged transfer of intellectual property from their former team to their current team.

“We are cooperating fully with investigators,” said the team in a statement issued on Wednesday evening. “Given that this is an ongoing investigation, we are limited in what information we can share right now, but we intend to provide additional information as soon as we can.”

The FBI is also alleged to have visited the Andretti shop in August to look for proof of possible IP-related improprieties.”

If all of this is true, and given the fact that there is clearly enough evidence for a search warrant to be issued here, Rahal Letterman Lanigan is in deep shit right now. If there is enough evidence that this employee did transfer confidential information, then there are serious charges a coming! The team isn’t in the clear, since this information was uploaded to their computers. Personally, if I were a member of Rahal Letterman Lanigan, I’m sweating bullets right now. If I’m a sponsor, I’ve got more than a few questions. I think there may be serious issues a coming, and IndyCar does NOT need any more bad looks right now.

But this also brings to mind the moronic idea of banning non-compete clauses. This is why. An employee got fired from one race team, stole confidential information, and brought it with them, and uploaded it after getting hired by another team. This is the exact reason a non-compete exists in this day in age. Companies are really worried about the security of their information and intellectual properties, and a situation like this is proof.

The FTC and their chair Lina M. Khan stated the following for the ban:

“Noncompete clauses keep wages low, suppress new ideas, and rob the American economy of dynamism, including from the more than 8,500 new startups that would be created a year once noncompetes are banned. The FTC’s final rule to ban noncompetes will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market.”

I get FTC Chair Khan’s reasoning. But if individuals have access to top level information, not meant to be seen by the competition, this approach could do more harm than good. I really think that this story will be interesting, and I’m going to follow this as it happens.

With that, I’m done for the week, and I’ve got some stuff for next week.

Sources Cited:

https://www.indycar.com/News/2024/09/09-23-Charters

https://www.indycar.com/News/2024/09/09-24-Charter-QA

IndyCar charter program launches after final team owners sign

IndyCar Leaders Circle race heating up

FBI agents carry out operation at RLL headquarters

https://www.ftc.gov/news-events/news/press-releases/2024/04/ftc-announces-rule-banning-noncompetes

My Thoughts On The Current NASCAR Cup Charter Situation

By David G. Firestone

Well, the NASCAR charter fiasco has reached its peak. On September 7, NASCAR presented its final charter offer. According to Jayski and Sports Business Journal:

“The term of the charter agreement is for seven years starting in 2025 and commensurate with NASCAR’s new media rights deals that begin next year, meaning teams who signed on did not get the permanency of the system they had been negotiating for in recent years. Teams are getting more revenue as part of the deal, which stems from NASCAR getting a 40% increase in its media rights agreements worth $7.7B. For example, the last-place charter got around $4-5M annually in the old charter agreement from 2016-24, while that will go up to around $8.5M in the new version from 2025-31, people familiar with the matter said.”

NASCAR then gave the teams an ultimatum to sign the new deal. Of the 15 teams, 13 signed the charter. Some were happier than others, but most realized, in the words of Justin Marks:

“It’s been kind of a living document that has changed a lot as these conversations have taken place. But for me, and I can only speak for me, in the back of my mind, if they don’t put a deadline on it — well, the deadline is when we go racing next year — if the day doesn’t come when finally someone goes ‘we’re done here and we’ve taken as long as we need,’ then it will never come and it will never end. So me, personally, as we’ve had these conversations, I was anticipating the day that NASCAR would come and say ‘this is it. We’re done. We’ve addressed all these issues and you know where we won’t move, we’ve agreed on 90 percent or 75 percent of it (so) it’s time to get this thing done and start building our future together.

I think everyone can interpret it in their own way,” Marks said. “For me, regardless of how you want to build a narrative around it. Ultimately, it’s NASCAR’s sport and they said, ‘We are done negotiating here, this is the deal, it’s not going to change.’

“Ultimately, we had to make a decision and I looked at that and I said, ‘I’m not going anywhere so we’re going to sign it.’ You can interpret that anyway you want. Every team and team owner has their own relationship with NASCAR and mine, the philosophy of mine is always coming from a place of partnership and collaboration so I don’t necessarily feel like it was that way.

Rick Hendrick had this to say:

“I think we worked really hard for two years and it got down to, you’re not going to make everybody happy. And I think it got down to, I was just tired,” Hendrick said. “Not everybody was happy. But in any negotiation, you’re not going to get everything you want, and so I felt it was a fair deal and we protected the charters, which was number one, we got the (revenue) increase, I feel a lot of things we didn’t like we got taken out, so I’m happy with where we were.”

The two holdouts who didn’t sign were 23XI Racing and Front Row Motorsports. For some reason, these two teams think they can hold out for better terms. Why? I have no idea. 23XI is owned, in part, by Michael Jordan. Say what you want about Jordan, but you can’t argue he doesn’t know how to negotiate. He also has the star power of Bubba Wallace, Tyler Reddick, and co-owner Denny Hamlin. Them holding out could work, since they do have star power.

Front Row is a different story entirely. In the Cup Series, they have a total of four wins in their entire existence since 2005. To put that in perspective, Tyler Reddick has four wins for 23XI Racing in the last two years. Front Row is not a powerhouse team by any definition. What makes this strategy even more perplexing is that Front Row is trying to buy a charter from Stewart-Haas. I can’t see this working out to well for them.

Front Row has no leverage whatsoever. 23XI has some leverage, but with 13 teams signing the agreement, they don’t have as much as they think. The other teams realized that this had to end at some point, and signed the deal. NASCAR strong-armed their teams into signing. While this isn’t a great look, they really didn’t have any other options. It is what it is really.

Realistically, this was the only outcome. Everyone was tired, everyone was at the end of their rope, and the outcome was, well, meh. Sometimes the best outcome is just a stalemate.

If anything changes, I will talk about it next week. If not, I will probably discuss the Rahal Letterman Lanigan Racing situation. We’ll just wait and see.

Sources Cited:

Is a charter agreement imminent? UPDATES

https://www.sportsbusinessjournal.com/Articles/2024/09/08/nascar-charter-23xi-racing-front-row-motorsports?publicationSource=weekendrap&issue=02e4f665af3748efb18a8d38d8c2fe5a

Rick Hendrick, Justin Marks comment on charter agreement

https://www.sportsbusinessjournal.com/Articles/2024/09/06/nascar-cup-series-charter-update?publicationSource=sbd

https://www.sportsbusinessjournal.com/Articles/2024/09/03/nascar-looking-to-wrap-up-charter-negotiations?publicationSource=sbd&issue=ffc261c61ff24ea88d1cf1f13295b2e4

https://en.wikipedia.org/wiki/23XI_Racing

https://en.wikipedia.org/wiki/Front_Row_Motorsports

By David G. Firestone

So for this week, I’m going to discuss the upcoming 2025 NASCAR Cup Series schedule. There are a few changes, which are, according to Wikipedia:

“-The Busch Clash will move to Bowman Gray Stadium in 2025, replacing the Los Angeles Memorial Coliseum. It will be the first NASCAR Cup Series race held at the track since 1971.
-Autódromo Hermanos Rodríguez will host a points paying race, becoming the first points paying Cup race outside the US since 1958. Richmond Raceway will lose a date to accommodate this change.
-The races at Gateway Motorsports Park, New Hampshire Motor Speedway, and the Southern 500 at Darlington Raceway, will be added to the playoff schedule. As part of this schedule change, Watkins Glen International, Homestead–Miami Speedway, and the Quaker State 400 at Atlanta Motor Speedway, will move to the regular season.
-The Quaker State 400 at Atlanta Motor Speedway will be the opening race for the new NASCAR in-season tournament.”

I’ve discussed how much I love the idea of Bowman Gray hosting the Busch Clash and how I think it should lead to historical tracks hosting the Clash. I’d also like to see something like this in both the Xfinity Series and Truck Series. I hope this goes forward.

I like the dea of Autódromo Hermanos Rodríguez hosting a points paying race, however I think that Richmond should have been kept on, and a different track, preferably a 1.5 mile track been removed. I hope this may also extend into Canada.

I will discuss my feelings on the Chicago Street Race on a latter date.

With the good out of the way, now let’s about this bullshit “tournament.” Here is how this tournament will “work” as explained by Wikipedia:
-“The NASCAR In-Season Tournament is an upcoming multi-phase tournament that will be conducted among drivers in the NASCAR Cup Series. It is scheduled to debut in the 2025 season.

-Format

-The tournament will consist of eight races.

-For the first three races, all full-time drivers in the series are eligible to compete. Race winners will automatically qualify for the bracket, and be joined by the drivers with the best finish in any of the three races, with ties to be broken by total race points. The 32 drivers with the best performances move on to the next phase of the tournament. The seeding races will be streamed on the new package to be shown on Amazon Prime Video.
The last five races will be conducted in a single elimination bracket. In each round, the driver in each match-up with the better finish advances, while the other is eliminated. This process will continue until only two drivers remain; the driver with the better finish in that race will be the tournament champion and win a $1 million bonus. All of these races will be shown on TNT.

-In 2025, the first race of the bracketed portion will be held at Atlanta Motor Speedway on June 28.

-The In-Season Tournament will be the second $1 million bonus event in the Cup Series, joining the NASCAR All-Star Race.”

First off, moving to Amazon Prime is going to cost NASCAR a lot. A lot in terms of viewers lost, money lost, sponsorship lost, and fans lost. If you are going to try something this audacious, why not have it on actual TV. This is another example of NASCAR focusing on what they want, as opposed to what they have. This will not go over well with the NASCAR fan base. I have no confidence in Amazon Prime Video for NASCAR.

Second, while I get the bracket format, it works for the playoffs. This random tournament, with nothing on the line except money isn’t really good. Especially the 1v1 format of the last five races. 10 drivers, 1v1 elimination, until two drivers are left. Why not have the same bracket as the playoffs?

Here’s my idea: I like the general idea of how to qualify: For the first three races, all full-time drivers in the series are eligible to compete. However, I would only have the top 20 drivers in points, all arranged by points, both regular and playoffs.

From there, I would do this: 5 races, top 20 drivers in points, all arranged by points, both regular and playoffs. Each race, the bottom 4 drivers get eliminated. 4 races, 16 drivers eliminated. Last race, highest finishing driver wins. There is no reason you need 32 drivers in a single-elimination bracket. If we have to actually do this horseshit, why not make it simple. Make it easy to follow.

Also, shouldn’t there be something more than money as a prize? I’d add some points to the mix. Other than that, there really isn’t much on the line. Realistically, there isn’t any reason this has to happen to begin with, but at least make it worth the effort. Money and points, at least that gives incentive. I just don’t get this at all.

I’ve at least praised IndyCar for moving from NBC to FOX in 2025! That was a smart move! The Peacock-only races are not doing well, and fans are not happy, so this is an improvement. NASCAR is taking a major step back, and IndyCar is taking a major step forward.

To top all of that off, since I have Directv, I can’t watch F1, since it’s on ESPN, and Directv and ABC are in a pissing match. It’s just not a good time to be a racing fan!

With that, I’ll be back next week.

Sources Cited:

https://www.jayski.com/nascar-cup-series/2025-nascar-cup-series-schedule/
https://en.wikipedia.org/wiki/2025_NASCAR_Cup_Series
https://en.wikipedia.org/wiki/NASCAR_in-season_tournament