NASCAR President Steve Phelps: 'Something needs to change' in team charter deals
NASCAR President Steve Phelps opened up about team charter deals as the 2024 Cup Series season winds down. On Kevin Harvick’s Happy Hour, Phelps talked about the future of cost containment and whether will it be done through rules or a cap.
“Something needs to change because if it doesn’t change in my opinion in seven years when we’re re-negotiating the financials of these charters, it’ll come back to we’re not making any money or we’re losing X, Y and Z, and you’ll always be chasing that,” Phelps said. “If there’s more money given, typically what happens is race teams want to take every dollar and then some and spend it to go fast.
“Which I get because it’s a vicious cycle that exists. If you don’t go fast, you can’t get sponsorship, if you’re not winning, you can’t get sponsorship. We have seen over the last decade teams that don’t run well, it’s hard to get sponsorship, and they’ll lose it and will either be stolen by another team or worse yet, they’ll leave altogether, which is not in the best interest of anyone.”
Phelps continued, “I would say to race fans we want to make sure race teams have a level of profitability. But it is incumbent upon the sanctioning body to do things that allow them to do that. Cost containment is a big portion of that.
Are permanent team charters in NASCAR’s future?
The charter system has been in place since 2016, and the current deal expires after this season. There are 36 charters, and each team is required to compete in every event. In exchange, teams received a payment based on attending each event, performance in the event, season-ending points fund and performance from the past three years, per NBC Sports.
NBA legend Michael Jordan, who is also a co-owner of 23XI Racing, recently told the New York Times NASCAR’s unwillingness to create permanent charters is a “big, big miss” and that “if you don’t correct that, the sport’s going to die not because of the competition aspect, but because economically it doesn’t make sense for any business people.”
“In all partnerships, if you grow the pie, that means your business is going to continue to grow,” Jordan said. “And to grow the pie, you’ve got to make sure everybody’s healthy within the partnership. If our ownership in NASCAR is losing money and NASCAR’s the only one making money, that’s not a good partnership.”