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Kobritz: NASCAR facing challenges on, off the track
Beyond the Lines

Joey Logano (22) does a burnout after winning the NASCAR Cup Series championship auto race at Homestead-Miami Speedway, Sunday, Nov. 18, 2018, in Homestead, Fla. (David Graham/AP)

Joey Logano (22) does a burnout after winning the NASCAR Cup Series championship auto race at Homestead-Miami Speedway, Sunday, Nov. 18, 2018, in Homestead, Fla. (David Graham/AP)

NASCAR wrapped up its 71st season last week and although series winner Joey Logano had reason to celebrate, the same can’t be said for the governing.

Television ratings continued to plummet, down more than 20 percent over last year, according to Nielsen. The numbers have fallen 62.6 percent from the sport’s high in 2005, a precipitous drop that would sound the death knell for most properties. Fortunately, NASCAR was able to negotiate a combined, 10-year $4.4 billion deal with NBC and Fox in 2013, before the four highest profile drivers of this era — Jeff Gordon, Tony Stewart, Carl Edwards and Earnhardt Jr. — retired from the sport.

Sponsorship is another major issue in the sport. Jimmie Johnson, winner of seven NASCAR titles since his debut in 2001, will have a new major sponsor next year. For the first time in his career, Johnson will not be running under the Lowe’s banner. Ally Bank, an internet powerhouse, will replace Lowe’s beginning with the Daytona 500 in February.

Johnson is more fortunate than the likes of Martin Truex Jr., one of the four title contenders in the last race of the season in Homestead, Florida. After Truex lost one of his co-primary sponsors, 5-Hour Energy, his Furniture Row Racing team announced it was closing shop, one year after Truex won the title. Other long-time sponsors, including Target, Subway and Home Depot, have also exited the sport in recent years. In an effort to accentuate the positive, NASCAR says nearly half the Fortune 100 companies have sponsorship deals in the sport, with teams or the governing body.

But it’s tougher for teams to view the world through NASCAR’s rose-colored glasses. Low budget teams spend in excess of $20 million to run the entire Monster Energy Cup series’ 36 races. Top running teams can spend in excess of double that amount. NASCAR has discussed ad nauseam how to cap team spending, but there is no easy fix. Unlike sports leagues that have spending caps on payroll, NASCAR teams have multiple spending areas — the driver, research and development, engineering, shop expenses, and pit crew among them — which would necessitate multiple caps and create a nightmare to monitor and enforce.

In addition to teams’ concerns over sponsors, series title sponsor Monster Energy has only one season remaining on its contract. NASCAR has struggled to find a sponsor since their 10-year, $750 million deal with Sprint expired after the 2016 season. The 2020 season may see a number of companies sponsoring portions of the season in order to approximate the $20 million Monster Energy is currently paying.

Among the suggestions to reverse the slide are reducing the number of races per season; shortening races, most of which exceed three hours; simplifying the rulebook; avoid changing the rules on a race-to-race basis — and sometimes within a race; and filling the leadership void that currently exists. None of these issues is new to NASCAR, which begs the questions: Can the sport ever return to its heyday of popularity?

The only certainty is NASCAR has no shortage of problems to address.

Jordan Kobritz is a non-practicing attorney and CPA, former Minor League Baseball team owner and current investor in MiLB teams. He is a professor in the Sport Management Department at SUNY Cortland and maintains the blog, sportsbeyondthelines.com. The opinions contained in this column are the author’s. Kobritz can be reached by email at jordan.kobritz@cortland.edu.

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