A Closer Look at the Charter System in NASCAR Cup
By Richard Tix
With much anticipation, NASCAR released the details of a new Charter System that will be implemented at the start of the 2016 season that is right around the corner (2016 Speedweek Schedule). For some time now it had been rumored that such a system might be coming, but after NASCAR announced on social media it had a large news announcement set for 2/9/16, it became a reality.
The rumors started a huge fan following on social media that started with "this is a stupid idea," to, "I will no longer go to a race because only 40 cars will be on the track." In short terms, it went from ridiculous to preposterous quickly. Most of this was coming from fans that knew nothing about the possible changes because details had yet to be released, yet were outraged.
In fact, all of the information was just "rumored" at the time (though some of it true), so no one really knew the full details on something they were so upset about.
In the end, the Charter system is a business decision made by NASCAR, its drivers, and its owners for the future of the sport to try and help facilitate an easier to forecast business model. Not only do they hope this helps the visibility of NASCAR teams and their costs, but also outside investors in the sport.
With more visibility NASCAR may become a smart business decision instead of a risky one, which may help lure some new sponsors and owners in. No longer will teams and sponsors have to worry about being in a race every week, or just that one week they have there name on the car. They can actually formulate a business plan that has at least some structure (every business plan has outside events that could happen, but as NASCAR is right now they're too many of them for it to be a smart business move).
If someone wants to get into a guaranteed spot then the market will dictate the price and they can get in by purchasing a Charter. No, it won't be cheap, but that also means that if a team is willing to spend that money they're also willing to spend it on the track and must have investors lined up. It also gives a team that is struggling financially the ability to get out with at least some sort of reimbursement by selling there Charter, instead of selling cars for a nickle and a dime. Lets get into some of the released details and what it means.
Charter Details
- 36 Charter spots. A Charter spot guarantees you into each week's race.
- Must have run every race since 2013 to get a Charter (41 and 19 will have to purchase one)
- Field is now 40 cars (down from 43)
- The final four spots will be determined by qualifying.
- Minimum nine year deal
- Charters can be transferred: or bought
- Agreement also includes the establishment of the Team Owner Council
Owned Charters
- Henrdick Motorsports (4)
- Team Penske (2)
- Richard Petty Motorsports (2)
- Richard Childress Racing (3)
- Roush Fenway Racing (3)
- Chip Ganassi Racing (2)
- Joe Gibbs Racing (3) - The 19 does not have one (will buy from MWR)
- Michael Waltrip Racing (2) - Will sell both (19 and 41)
- Stewart-Haas Racing (3) - The 41 does not have one (will buy from MWR)
- Furniture Row Racing (1)
- Front Row Racing (2)
- BK Racing (2)
- JTG Daugherty Racing (1)
- Tommy Baldwin Racing (1)
- Germain Racing (1)
- Go FAS Racing (1)
- Premium Motorsports (1)
- Circle Sport Racing (1)
- HScott Motorsports (1) - Going to lease from Premium for the #46 of Annett
What it all Means?
The biggest thing is how NASCAR teams or future teams enter the sport. It won't be as easy to enter the sport, but if they do they will be serious and most likely have the funds to run weekly. This Charter system lets potential investors and owners see what they might get back weekly with more clarity. With it, teams can see the bare minimum that they should bring in each year and have a more predicable financial model from year to year which they can use to grow or sell out of a spot depending on their outlook.
It also assures sponsor's that if they put a name or brand on a car, that it will race that week no matter what happens. The smaller teams can effectively sell there product (car) to potential sponsors and tell they they will be in the race each week.
I also mentioned above that it will also help out teams that have a Charter that might be struggling to leave the sport with a bit of some financial help (selling Charter). The way of looking at race teams is changing, but not all of that maybe bad. However, most of the product on the track should be the same for the most part. The new business environment should provide a more stable and appealing market for sponsors, owners, and investors. If all goes well this could be a big move for NASCAR, but as always the real part of all of this will be in the details and how it actually plays out. It will be another wait and see game in a world of it that we have come to know in NASCAR.
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