A funny thing happened when most teams signed their NASCAR Cup Series charter agreement renewals last week.
Much of the attention has been focused on 23XI Racing and the team’s refusal to sign the deal, positioning them on the outside looking in.
One of the questions that surrounds the non-compliance is this: what will NASCAR do with 23XI or Front Row Motorsports, both of whom chose not to sign?
It’s a solid question and brings up part of the whole issue with the charter system from an ideological construct. Did anyone ever define what a charter is? At one point, charters were called medallions or something silly like that, as if it were a coin that a driver hung from the rear-view mirror of their car and gave them permission to race. What it really did was provide assurance.
At the time, buying into the system mean that a car was assured a place on the grid, which meant a piece of the purse. In some ways, this created a stabilizing force in sport, giving teams some intrinsic value beyond just the machines and the shops and whatnot. (That’s not to exclude personnel, but it gets handled differently when thinking in terms of corporate assets.)
The charter system evolved into one where the teams started to have a collective (albeit fractious) voice to challenge the NASCAR oligarchy. The teams, which ostensibly provide the meat to NASCAR’s potatoes, found this new relationship beneficial in their demands to have more of the dessert. With new TV deals set to begin, the teams want to enjoy more of the desserts for the fruits of their labors.
However, NASCAR has continued to try to exist as the dictator that it once was. The problem is, if it really wanted to do so, it never would have let the medallion/charter relationship enter the garage. The compromise brought the sport more in line with MLB, the NFL, NBA and NHL. In these leagues, the franchises have seen nothing but growing rates of return in their value.
The major players in the sport have all grown up in it and may be pleased with the modest gains they made in the charter negotiations and while recognizing their own wealth. That seems like a good place to be. The outlier to all of this is Michael Jordan, who is either going to sell his team to Dale Earnhardt Jr. (doubt it) or is setting himself to get busy in the courts with NASCAR – something that the organization should fear, as it has kept its books relatively unseen.
Let’s look at how we get there.
Joe Gibbs Racing: $230 million
Joe Gibbs: $60 million
Gibbs is hardly the richest owner, even if his team has solid value. He’s now visiting the track as an 83-year-old and is likely more concerned about his team’s solvency compared to any massive personal gains. Under the charter agreement, going along to get along keeps his team happily on the track.
Hendrick Motorsports: $315 million
Rick Hendrick: $1 billion
Rick Hendrick has enough money to laugh about whatever money NASCAR is talking about. His second-in-command, Jeff Gordon, is a NASCAR lifer who understands the benefit of toeing the company line. No need to push back.
Team Penske: $200 million
Roger Penske: $3.8 billion
It is possible that Penske is not even aware that his team signed a charter because he is either A) too busy counting is money or B) too busy doing whatever he wants in the racing series that he actually owns. NASCAR be damned, he is more likely to try and make the NTT IndyCar Series a rival then to care about whatever peanuts NASCAR is giving him.
23XI Racing: $150 million
Michael Jordan: $3.2 billion
Jordan comes from a sport where he understands the value of the franchise model, noticeably just selling his share in the Charlotte Hornets for $3 billion. He made $2.6 billion on the deal. Jordan is not looking to jump out of the NASCAR game without realizing a return on his investment.
The second factor that perhaps everyone is overlooking is Jordan as a competitor. He was ruthless on the court. Getting into a showdown with NASCAR is nothing but a new arena for him to play in and let the competitive juices surge. He has f-you money to burn and could happily take NASCAR to court to open up a case that could put NASCAR straight into a battle that brings up words like collusion, antitrust, restrictive business practices and a whole lot of other things that officials should be looking to avoid.
In 1983, when John Elway somehow got traded to the Denver Broncos after the Baltimore Colts drafted him, Al Davis began proceedings to sue the NFL for sketchy business practices. The end result came in the form of the threats of being locked in a vault with Tom Brady’s cell phone and Al Davis being given permission to move his team to Los Angeles, a market he dearly coveted.
This story looks like it could play out just the same. At some point, NASCAR is going to realize that going against Jordan, who may have a love of NASCAR but does not have the same ties that the other owners do, will be a game they do not want to play.
For the moment, we can enjoy watching NASCAR officials hem and haw and attempt to stare down one of the best athletes to ever stare down an opponent.
As a writer and editor, Ava anchors the Formula 1 coverage for the site, while working through many of its biggest columns. Ava earned a Masters in Sports Studies at UGA and a PhD in American Studies from UH-Mānoa. Her dissertation Chased Women, NASCAR Dads, and Southern Inhospitality: How NASCAR Exports The South is in the process of becoming a book.
Quick answer to the article title: Probably. They’ve never lost yet, so like most bullies they won’t even entertain the idea they could be challenged until someone actually steps up and punches them in the mouth. Perhaps Jordan will be that someone?
I think you’re right about Gibbs, Hendrick, and Penske. They’ve been in the series long enough, they know the game is (and has always been) rigged. They still make money off of it, get to play with their racecars every weekend and pad the numbers which are already next to their names in the record books. Why would any of these guys want to rock the boat?
Your probably right. That family wants every single nickel it can make since it owns the game. Arrogance is every one them’s middle name. Jim’s 79 and I find it hard to believe he is calling all the shots. It’s probably going to come down to Jordan’s willingness to be tied up in court for years. I have no clue how this is going to turn out honestly. It’s definitely going to be court or someone backs down somewhat or totally.
A team which paid nothing for charters, HMS, JGR, 2/3rds of Penske, have very little reason to rebel. They have 20M per car number handed to them in the form of an original charter. 23XI and most others had to pay to get a charter. Of course they want more guarantees. The breakdown of the RTA through Jim France’s divide and conquer approach worked. The real winner in all this…Tony Stewart. He’ll walk away from this BS with at least 30M and never have to touch it again.
Perhaps MJ and Denny are the greedy ones? It’s NASCAR’s sandbox. If you don’t like the rules, find somewhere else to play. NASCAR will probably gift 23XI’s charters to someone in the France-Kennedy clan. A plan NASCAR already has for a few charters anyhow. Sign the agreement and shut up.