It is not possible to predict the road NASCAR will travel by the time we reach the final 2019 checkered flag, but it will be entertaining to speculate.

This decade begins as NASCAR tail spins in the wrong direction it’s a sharp contrast to the beginning of the last decade when NASCAR viewership, attendance and corporate interest were all surging. Today, all of those trends are in reverse, and this decade will truly define whether NASCAR remains as a mainstream sport or becomes another fledgling motorsport series.

I believe the major stories and events that will affect NASCAR in the coming years will have little or nothing to do with on track racing. So let me begin with a few predictions before we take our first green flag of 2010.

The Car of Tomorrow (COT)

By any account other than driver safety, the COT has been a miserable failure, and many point to the introduction of the COT as a defining moment in the accelerated decrease in fan interest. Since making its debut, the COT has been one of the most controversial rule changes to be introduced in NASCAR. There is no question that NASCAR will eventually make changes to their ill advised COT design, but the question is how dramatic and rapid will changes be introduced. I believe this decision will define the sport in the coming decade, because unless on-track racing significantly improves, NASCAR is doomed to become a second-rate sport with limited commercial exposure.

The Fall of Brian France

Mayfield vs. NASCAR is a fight NASCAR wishes it never fought. First, let me provide a bit of background information. In 2008 NASCAR implemented a clandestine drug testing policy where they refused to provide competitors a list of banned substances. And in 2009, long time driver Jeremy Mayfield, was the first driver to face a suspension for use of a banned substance. The drug was later identified as Methamphetamine, or more commonly known as Meth. (See my blog post in the summer of 2009 for more information – NASCAR in Peril: Victory for Jeremy Mayfield in Drug Testing Legal Battle). What NASCAR didn’t anticipate was Mayfield fighting back and filing a lawsuit to reinstate his license to drive in NASCAR. Both sides have won important decisions, but the court fight continues. However, just recently this soap opera is becoming even juicier, the U.S. District Court has ruled in favor of Mayfield to require sensitive documents about Brian France’s third (or fourth but who’s counting) marriage to be unsealed. Many insiders believe evidence will come forward further tarnishing Brian France’s ability to continue to lead NASCAR into the next decade.

Sprint as the Title Sponsor of the Cup Series

The elephant in the room is the pending expiration of the sport’s lucrative sponsorship agreement with Sprint as title sponsor of the NASCAR Cup Series. Back in the summer of 2003, when Sprint (f/k/a NEXTEL) agreed to a 10 year agreement with NASCAR, no one expected the rapid decline of fan interest and corporate sponsorship within just a couple of years. Ironically, Sprint too has blood on their hands for the sponsorship troubles of racing teams, which contribute to the overall problems in the sport. Sprint pushed out and prevented several companies from sponsoring racing teams, including AT&T Wireless who was prepared to enter NASCAR in 2004 as a primary sponsor, but Sprint through their exclusivity agreement with NASCAR, prevented AT&T from entering the sport. And then, after AT&T Wireless merged with Cingular Wireless (who was grandfathered into sport through their existing sponsorship agreement with RCR), Sprint pushed AT&T Wireless out once again. This was basically the same story for Verizon Wireless and Alltel. But I digress, we are discussing the future, and following the expiration of the current agreement with Sprint there is little doubt NASCAR will be left without a title sponsor of the Cup Series. And with the falling value of the title sponsorship rights, I expect NASCAR to be forced to sell the rights for a deep discount. But like everything else in NASCAR, the teams will bear the brunt of the negative financial consequences.

New Television Contracts

Not unlike, the situation with Sprint as the title sponsor, agreements with the existing television partners expire in a couple of years. And, with the enhanced competition from the NFL, all signs point to a significantly lower value being attributed to the NASCAR contract. The reduction in the sport’s revenues will further hamper smaller NASCAR teams from competing and consequently continue the most alarming trends of decreased fan viewership, attendance and corporate sponsorship.

The Retirement of Today’s Superstars

It’s no secret that Jeff Gordon has been suffering from significant back pain stemming from an on track accident. So the question begs, when will one of the greatest and most popular drivers hang up his racing helmet? Could the dominance of Jimmie Johnson accelerate Jeff Gordon’s retirement? And more so, Jeff Gordon isn’t the only NASCAR star that could retire in the next decade from full-time racing. Is it possible, if Dale Earnhardt Jr.’s performance doesn’t dramatically improve that he might head towards an early retirement? These questions will surely plague NASCAR in the forthcoming decade and could have far reaching effects on the entire sport. Even though in the past several years neither Gordon nor Earnhardt have been top performers on the track, they still remain the top two fan and sponsor favorites. And during a time when NASCAR is desperately trying to stop the hemorrhage of fan and corporate interest, the retirement of one or both iconic names could be devastating.

My negativity is an attempt to bring forth positive change to NASCAR. It is horrifying to watch a sport I have watched most of my life be destroyed. But without question, NASCAR, under the leadership of Bill France Sr. and Bill France Jr. made many wise decisions which helped to elevate the sport to the peaks in 2004. Unfortunately, the management decisions of NASCAR in the last half of the past decade have grossly undermined the sport. Even though the previous generations of the France Family were successful shepherds of NASCAR, under the faltering management of Brian France – NASCAR has failed its competitors, fans and sponsors. If the France Family truly loves NASCAR – then they must consider selling NASCAR to a new ownership group, who is prepared to rebuild the sport before all remains is a storied past.

Most will agree that the current economic recession will have a significant financial impact on NASCAR teams and the sport as a whole – but does it really need to be this way? In 2009, there will be significantly less Sprint Cup teams competing on a weekly basis – and yet, in economic downturns other sports such as the NFL or NBA do not have reductions in teams. Why is this so?  The answer is rather simple – other sports operate as a democracy with all teams participating in the economic benefits of the television contracts; while NASCAR on the other hand, is structured much closer to a dictatorship – with the profits being retained by NASCAR Corporate which is owned solely by the France Family.

Let’s examine the recent history and evolution of NASCAR: during the global economic expansion following the tragic events of 2001 – 9/11 & the death of Dale Earnhardt Sr., NASCAR experienced unprecedented interest from corporate sponsors; and growth was fueled by new television contracts with Fox and NBC. Because of NASCAR’s unique business model, which is vastly different than other sports, the industry flourished from 2003 until recently, gathering new teams, with investors and manufacturers flocking to the industry.

As a point of reference, NASCAR is the ONLY major US sport without a franchise model including profit sharing agreements. NASCAR Teams operate in a free market where teams must survive without much financial assistance from NASCAR Corporate; and where new teams can easily compete if they have the financial backing. I was a personal beneficiary of this policy – and at 23 years of age secured an agreement to led Toyota Motorsports into the NASCAR Craftsman Truck Series and went on to build  their competitive platform for their NASCAR operation.

I am very fortunate to have realized my lifelong dream of owning and operating a top tier NASCAR team; and even more rewarding to have brought Toyota Motor Sales their first two NASCAR victories.

However, this so-called free market is a complete farce! The teams must secure over 90% of their operating budgets from corporate sponsors – a/k/a advertisers. What is more infuriating, and what is not common knowledge, is that NASCAR and its sister company ISC retain the vast majority of the sport’s healthy television contract revenues, and even compete against the teams  for corporate sponsors -  the  lifeblood of the race teams.  As many know, AT&T was forced to leave Richard Childress Racing (RCR) as a primary sponsor because NASCAR Corporate signed an agreement with Nextel (now Sprint) with an exclusivity provision precluding other wireless and telecommunication companies from sponsoring any racing team. So with teams on the verge of a depression – and with automotive manufactures and corporate sponsors reducing their involvement – NASCAR is busy lining their pockets at the expense of the teams.

The most fundamental precept is that without teams – there is no NASCAR; but somehow teams have failed to act on this most basic concept to leverage their position within the sport. Maybe in the past the very wealthy owners such as Rick Hendrick, Jack Roush and Roger Penske were complacent and satisfied with receiving a nominal share in the television revenues; but in today’s economic climate and the ultra competitive advertising marketplace – teams who want to keep standing on their feet, need to act now and demand a fairer share in revenues – not for personal profit; but simply to survive.

The management of NASCAR has a real opportunity to bring forth a “rescue plan” to save teams from closing their doors and fracturing the appeal of NASCAR; which could have irreversible effects on future television contracts and ultimately the profits of the France Family. The beauty of the NASCAR “dictatorship” is that they don’t need to hold a vote or seek the opinions of others; instead, they can just swiftly act to provide an increase in the teams’ alterative revenues, which would enable teams to offer sponsors a lower cost of entry to advertise in NASCAR.

You can’t expect any company to spend $20M to sponsor a NASCAR Team – the ROI isn’t remotely competitive. NASCAR needs to think long term and be willing to sacrifice some of their short term earnings for long term stability and growth in the NASCAR economy.

Richard Childress Racing (RCR) has much to be proud of these days and is tearing up the NASCAR Sprint Cup Series with having all 3 of his cars in the Top 12 in point’s standings; and is currently qualified for the Chase for the Cup. However, the off-the track business maneuvers of this champion contending organization is even more impressive. Yesterday, Caterpillar a long time sponsor of Bill Davis Racing (BDR) announced they signed a multi-year agreement with RCR to become the primary sponsor of Jeff Burton and the #31 team – replacing AT&T who is prevented from returning to the sport by NASCAR and Sprint. This announcement comes on the heels of RCR securing General Mills as the primary sponsor of their 4th team.

It’s ironic – the same rules that help you one season can come back to bite you the next. Case in point, the guaranteed starting position, which is afforded to the teams in the Top 35 in points, has been one of the motivating factors for the switch by Caterpillar to RCR (RCR #31 team is 2nd in the point’s standings). If you recall – this unfortunate rule was instituted by NASCAR only after the BDR Caterpillar team failed to qualify for a race in 2004 under the old rules. Regardless, you must congratulate RCR on their off-track success as they strengthen their organization to be better positioned to effectively compete with the super teams of Hendrick Motorsports and Joe Gibbs Racing.

Since 2002, the last year BDR won a race, they have rapidly unraveled and are clearly on the road of becoming defunct. In 2008 we see RCR redefining success with having 3 teams in the top 12; while two other organizations are teetering on the verge of extinction.

(full disclosure: In 2005, my team (Bang! Racing) was adding a Sprint Cup team and the Top 35 rule resulted in the loss of new sponsors)

Earlier this week, Dale Earnhardt Jr. provided a candid team owner’s perspective of the forthcoming change to the Car of Tomorrow (COT) in the NASCAR Nationwide Series. When asked about his future Sprint Cup plans with JR Motorsports, he said:

“I used to say no way, no way. But it’s almost as expensive to run in the Nationwide Series. And they’re going to bring a COT in and we won’t be able to race in the Nationwide Series with the COT probably. That’ll just be too expensive to switch all that over.”

“…And the COT program is going to be too expensive for me to justify creating a whole new program with COT stuff, so I’d just as soon go into the Cup Series or get out of the Nationwide Series altogether.”

Dale Jr.’s statements raise an alarming concern on the viability of the Nationwide Series. Let’s be honest – if the Nationwide Series business model doesn’t work for JR/Hendrick Motorsports – why then, would anyone think it would work for someone else? I have a hard time envisioning any other team being able to justify the capital expenditure required to compete in the NASCAR Nationwide Series with the COT. The pending arrival of the COT to the Nationwide Series couldn’t be at a worst economic time. Even teams such as Richard Childress Racing (RCR) are struggling to find new sponsors; and in retrospect, recently announced that the former Championship #21 team would be reducing its schedule in 2008 for the Nationwide Series due to a lack of sponsorship.

It’s undisputed that the COT provides enhanced safety for the drivers – which are undeniably priceless. However, compensation for improved safety should be at the forefront of NASCAR’s economic model and NASCAR should provide assistance for the teams’ through financial allowances to ensure that drivers and crew members are safe; while at the same time, enabling team owners’ to survive. It’s unfortunate that team owners must bear 100% of the financial burden of safety while NASCAR corporate continues to retain the vast majority of revenues and profits – continuing to drain many of the teams’ livelihoods – and perhaps even to the sport’s future longevity.

If I was still an owner of my NASCAR team (Bang! Racing), I would organize the Nationwide Series Team Owners to take a stand and demand financial assistance from NASCAR to adopt the COT in 2009. If Dale Jr. can’t afford to- who in the world can?

Last year, undoubtedly was the most dramatic year for racing fans in NASCAR Silly Season history with Dale Jr. moving from Dale Earnhardt Inc. (DEI) to Hendrick Motorsports. But this year may prove to be the most crucial for team owners, as sponsors and drivers play musical chairs as they navigate through the myriad of sponsor changes. With the enhanced expectations of corporate sponsors, drivers must be careful to choose the right team for 2009 and the future. Just look at DEI, Michael Waltrip Racing, Chip Ganassi Racing, Hass CNC Racing, Richard Petty Enterprises and Yates Racing – all are in dire need of sponsorship. And yet, you must give credit where credit is due – Travis Kvapil (my former driver at Bang! Racing) is doing an exceptional job for Yates Racing – but honestly, I don’t believe that sponsors are lined up at Yates door.

Every year, there is always one driver who defines all of Silly Season and in 2008 – that man is Tony Stewart. But to be realistic – you must believe that most, if not all sponsors considering a change (or any potential new sponsors – are there any?) will wait until Stewart makes up his mind before finalizing their 2009 plans.

It is well known that Stewart wants back into the Chevy camp where he has won two NASCAR Sprint Cup Championships and over 30 races. So that leaves Stewart with only two legitimate options – Hendrick Motorsports or Richard Childress Racing (RCR). Yes, RCR has won more races than Hendrick in 2008 but I would be shocked to see Stewart join RCR and race the Cheerios car. But on the other hand, Hendrick already has four drivers – didn’t they say they had “no room at the inn” last year before signing Dale Jr.? Could Casey Mears be moved to a satellite team like Hass CNC? Let’s just imagine – Dale Jr., Jeff Gordon, Jimmie Johnson and Tony Stewart all as teammates?

Only time will tell where Tony Stewart lands in 2009 – but the drivers better be ready to grab a seat because once Stewart decides on his plans – it will be pretty easy to be left without a seat once the music stops in the high stakes game of NASCAR Silly Season 2008.

Recently, Richard Childress Racing (RCR) made a major announcement – General Mills (NYSE: GIS) has agreed to a multi-year partnership to sponsor the No. 33 Cheerios®/Hamburger Helper® Chevrolet Impala SS beginning with the 2009 NASCAR Cup Series season.

This is the final nail in the coffin for NASCAR’s oldest team – Petty Enterprises. With its dismal performance in the past two decades, NASCAR’s old boys’ network continues to crumble. The trend of corporate sponsors to gravitate to the elite stables of Hendrick Motorsports, Joe Gibbs Racing, Roush Fenway Racing, Richard Childress Racing and Gillette Evernham Motorsports continues to challenge the sustainability of the remaining fledgling racing teams.

The days of former drivers and crew chiefs operating inefficient poor performing racing teams and shaving millions of dollars from major corporate sponsors are clearly over. The future of NASCAR is clear – there will be six to eight teams, each with four cars. The most elite will thrive; the others will fight for survival and the appeal of NASCAR with its core fans will continue to deteriorate.

Sincere congratulations to Richard Childress Racing and General Mills and best of luck in 2009.