For the first time since the charter system began back in 2016, the general public got to see how much money NASCAR Cup Series race teams are making this week.
And for the first time in its 77-year history, NASCAR’s financials were revealed as well.
Boy, oh, boy, were the totals all much worse than people expected.
The money situation between NASCAR and its teams was forced into the public eye due to the discovery phase of the lawsuit between NASCAR and 23XI Racing/Front Row Motorsports. Despite several warnings from judges and others involved that essentially anything they wanted to keep private would become public through this process, the two sides failed to come to terms in a settlement in time to prevent discovery.
Before we get into just how bad the financial reports made NASCAR look, a huge round of kudos needs to be given to FOX Sports’ Bob Pockrass for digging through the hundreds of legal documents and sharing the juiciest nuggets. Credit also goes to former Frontstretch staffer Michael Finley, who took the information made available and made a chart to actually show team earnings in detail.
The biggest takeaway is that NASCAR made a profit of just over $100 million in 2024. Keep in mind that’s not the total revenue; no, that figure was over $1 billion. What that means is after all of the expenses were paid — race team and track payouts, salaries, licensing, taxes and other general expenses — the league pocketed nine figures.
Naturally, the France family, the primary stakeholders of NASCAR, deserve to make some money. After all, it is responsible for starting and maintaining the series. But I’m willing to bet that those profits are added onto salaries paid to CEO and Chairman Jim France, Executive Vice Chair Lesa France Kennedy, plus EVP and Chief Venue & Racing Innovations Officer Ben Kennedy. That is a pretty standard practice among a lot of privately-owned companies: The owners collect a salary as well as profit dividends.
But it’s important to note that their salaries would likely be included in the $900 million in expenses, not the $100 million in profit. I don’t know what anyone in the France family is getting paid, but it’s probably more than some NASCAR Xfinity Series and Craftsman Truck Series drivers are making.
Also, I’d be willing to bet Brian France, former CEO and chairman of NASCAR, is still collecting a salary, even though he is no longer involved in the league’s leadership. There’s a reason NASCAR, 23XI and FRM agreed to not mention his name in the trial, and you have to wonder if that could be it. France has been sidelined from a leadership role since getting charged with a DWI and possession of a controlled substance in the summer of 2018.
Of course, the “NASCAR is dying” crowd quickly latched onto the report that NASCAR profited $500 million in 2023, meaning it made $400 million less the following year. But 2023 is actually an outlier, because NASCAR received $544 million off the sale of the majority of the land Auto Club Speedway was on. That means NASCAR did invest some of the earnings that year elsewhere, and the real estate agent probably got a cut they could retire off of. But still, the France family stuck $500 million in their pockets.
Now, why are these profits an issue? The Frances own the company and put in the work. The family should be able to keep as much of the profits as it can, right?
The problem is the financial reports also showed some Cup teams are struggling to break even, with others even losing money year after year. FRM owner Bob Jenkins said in a deposition he had lost $60 million since the start of the charter agreement and $100 million in his total time in NASCAR.
In the chart released that shows team profits and losses, it was revealed nine of the 12 teams listed lost money in the 2024 season. Of the three that made money, only one profited over $1 million (specific team names were not revealed).
These team owners put in just as much work as the France family and are equally responsible for its success. So why are majority of them losing money while NASCAR pockets $100 million? NASCAR could pay off the teams’ total debts and would still have about two thirds of the profit it has now.
In the past, I would’ve argued that it’s the teams’ fault they’re spending so much money. That’s a point NASCAR has apparently argued as well, given Joe Gibbs’ daughter-in-law and Joe Gibbs Racing heir Heather Gibbs’ letter to NASCAR. It’s a point Heather Gibbs passionately argues against on behalf of the owners, and I encourage folks to read the whole thing.
But it was the teams’ fault that the spending got out of hand for a time. When owners like Rick Hendrick and Roger Penske entered NASCAR, they didn’t care how much money they spent since they made their money outside of racing. So they outspent the competition, and it was either keep up or get run out of business, like what happened to the teams at the time whose only income was from racing.
However, that argument can’t really be made anymore, because now all the teams have to pay huge rates to get the same equipment necessary to build a Next Gen car.
Many will point to the charter system as the reason teams are losing money these days. But after looking at Finley’s chart, which was created using the payout formula released in the court documents, the charter system appears to be a Band-Aid.
With the charter system, every car is guaranteed at least $5 million. Without it, the back half of the field would really be losing money and potentially closing shop. It’s a system along the lines of the NFL’s revenue sharing that has kept teams like the Green Bay Packers from going out of business. The difference is NFL teams are stakeholders in the league, so they split up all the profits. They are guaranteed much more than just half a percent of the league’s revenue, which is what $5 million is of $1 billion.
So the charter system helps. It just doesn’t help enough. The reason it is being blamed for teams being in the hole is because sponsorship is drying up. Before the charter system, teams would’ve had no shot at staying afloat without sponsorship. But those were the days where Lowe’s, Home Depot, Budweiser, M&M’s, FedEx and other major sponsors were spending well over eight figures to be on a racecar the entire season. The sponsorships were so big that guys like Jeff Gordon and Dale Earnhardt Jr. were making over $30 million a year.
Now, I’d be amazed if a Cup driver made half of that. And it’s because teams aren’t making those kinds of sponsor dollars anymore. Why should they when ratings for some playoff races are getting less than 2.5 million viewers? But a big part of the reason those ratings are down is because NASCAR took more money to put races on streaming or cable this year, with the least amount of network TV races since before 2001. And while NASCAR did increase the amount it was giving to the teams in the latest charter deal, it’s easy to see why 23XI and FRM felt it wasn’t enough.
All of this so far has solely been talking about Cup teams. I have no idea how Xfinity and Truck teams are staying above water. They don’t have a charter system and race solely for the purse. Have you seen the sizes of their purses? The two series together make up less than 25% of the weekend’s purse.
That’s why Tommy Joe Martins, co-owner of Xfinity team Alpha Prime Racing, went on a rampage on X after seeing the figures in the released documents. It’s why those two series have primarily become rent-a-ride series, as the car owners would go broke without a funded driver getting in the car. I’d say the Xfinity and Truck owners should take NASCAR to court next, but they don’t have Michael Jordan money.
The trial between NASCAR, 23XI and FRM may happen, or heck, it may have already been settled by the time you read this. Both options feel like a toss-up, just like who will win if it reaches the Dec. 1 trial date. More documents may still come to light, and maybe those make the race teams look like the bad guys.
But from everything released this week, the court of public opinion seems to have shifted against the NASCAR stakeholders.
They’ll have their work cut out for them to win back favor.
Michael Massie joined Frontstretch in 2017 and has served as the Content Director since 2020.
Massie, a Richmond, Va., native, has covered NASCAR, IndyCar, SRX and the CARS Tour. Outside of motorsports, the Virginia Tech grad and Green Bay Packers minority owner can be seen cheering on his beloved Hokies and Packers.
“it was revealed nine of the 12 teams listed lost money in the 2024 season. Of the three that made money, only one profited over $1 million”
Wow. As Mr. Massie admirably notes in the article, it’s possible more information will come to light. If this is indeed the true state of the teams, this information, coupled with NASCAR pocketing $100m in profit rather than sharing during hard times, is not a good look.
I had guessed 23XI and FRM knew at least some of this, as they’ve been adamant throughout they want to see the truth be publicly released.
NASCAR should have been working with the teams during this, and shown some transparency. To have organizations like Penske, Gibbs, and Hendrick either losing money or essentially breaking even while NASCAR is still taking a tidy profit is indefensible.
This is somewhat similar to the CART/Indycar split, and as we all know, there were no winners back then, only varying levels of losers. If NASCAR doesn’t come down from their ivory tower, helping teams financially as well as involving them more in decision making, it seems both sides here will lose as well.
i recall hearing a year or two ago that jrmotorsports didn’t make money in a particular year. yes it’s xfinity, but for an earnhardt organization to not make money is sad.
I don’t know if Earhardt losing money is sad since he can afford it and probably write it off in his tax return but it is telling and makes you wonder about some of the other teams.
He also has other ventures in which he’s making some money.
I go back with the sport to the days of the PDA, (Professional Drivers Association), & the 1969 Talladega boycott. I’ve seen NASCAR screw over the independents, essentially pricing the sport out of their reach well before Hendrick, et al, were involved. Knowing what I do about NASCAR, I’ve been waiting for this day of reckoning for over fifty years. The financial disclosures didn’t surprise me in the least.
Not to sound vindictive as well, but after what they did to people like Carl Long and Jeremy Mayfield, and Robby Gordon, its a day of reckoning indeed and I’m not sad about it one bit.
What they did to Carl Long was criminal.
There was a red flag when the prize money stopped being shown in the results..