NASCAR’s economy in the pits
Published 11:37 pm Friday, January 23, 2009
By By JENNA FRYER, AP Auto Racing Writer
CONCORD — NASCAR chairman Brian France has ordered a companywide hiring freeze and suspended executive bonuses as the sanctioning body adjusts to the economic crisis.
Although many teams went through offseason layoffs — it’s estimated at least 600 people from various organizations have lost their jobs since November’s season-ending race — NASCAR itself has been immune to staff reductions so far.
But France said Thursday that open positions will not immediately be filled as NASCAR tightens its belt the same way most of corporate America has done since the economy began to falter last fall.
France said he’s also directed his management group to work with NASCAR teams in developing new business models that can help them withstand the current economic crisis. A sport heavily dependent on corporate sponsorship, NASCAR is increasing its involvement in helping teams locate and secure partners at a time when funding can be difficult to find.
The initiative is run by its Charlotte-based ‘‘industry marketing’’ arm, a four-person department that works closely with teams to find sponsorship.
Sponsorship woes have dramatically — and quickly — altered the landscape of NASCAR’s top three series over the past several months.
Petty Enterprises, a storied organization in NASCAR since 1949, had to merge with Gillett Evernham Motorsports to secure its future. The partnership was re-branded Richard Petty Motorsports earlier this week, a marketing move that keeps the iconic seven-time champion in front of the organization.
Wood Brothers Racing, in NASCAR since 1950 and second to the Pettys in on-track longevity, said Thursday it only has enough sponsorship to run 12 races in 2009.
Dale Earnhardt Inc., built by the late NASCAR superstar, merged with Chip Ganassi Racing during the final week of last season. The partnership led to the steepest layoffs of any organization that’s still planning to race full-time in 2009.
And team owner Bill Davis, a NASCAR stalwart who won his first NASCAR championship by clinching the Truck Series title in the season finale, was forced to sell his team when financial woes made keeping it afloat impossible. The new owners are unlikely to field Davis’ old teams this year in any of the top three series, preferring instead to focus on the chassis and engine building part of their acquisition.
NASCAR president Mike Helton said the turmoil is unsettling, particularly as it effects NASCAR’s icons, and shows the industry is not immune to the issues most everyone in America is currently facing.
France acknowledged 2008 was a difficult season, as high fuel prices hurt track attendance and Detroit’s Big Three automakers battled the credit crisis that is threatening their NASCAR involvement. But he’s confident NASCAR can weather the economic downturn.