Alex Meshkin

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.

Rumors are swirling that Jamie McMurray, currently the driver of Roush Fenway Racing’s #26 Crown Royal/Irwin Tools Ford, will be the driver of Richard Childress Racing’s 4th team, to be sponsored by Cheerios/General Mills.
Could this be a sign that Roush Fenway Racing is unable to secure a replacement sponsor for the American Automotive Association (AAA); and perhaps plans to accelerate its mandatory downsizing one year earlier?
On the other hand, it’s no secret that both Jamie McMurray and Jack Roush are extremely disappointed by their performances and both would welcome a change. However, with the enhanced marketing competition from Stewart Haas Racing, it’s unlikely that Roush Fenway will find a suitable replacement for the AAA and will be forced to move David Regan into the Crown Royal/Irwin Tools Ford.
As NASCAR Silly Season comes to a peak at the end of August, expect more announcements on the future plans of Ryan Newman, Martin Truex Jr., Casey Mears and Jamie McMurray.

Shortly after the official announcement from Tony Stewart about his plans to race under the rebranded Stewart Haas Racing (formerly, HAAS CNC Racing) for 2009 and beyond – I posted a poll question asking my readers about their predication for Tony Stewart’s success in 2009.

Personally, I am shocked by the overwhelming predication of more than 5 wins for Stewart. While I personally agree with my readers, that Tony Stewart will find more success next year than this – 5+ victories would be a tremendous achievement.
The most intriguing aspect to the Stewart announcement is the further strengthening of the Hendrick Motorsports umbrella. Under the support of Hendrick Motorsports, Stewart Haas Racing will field at least 2 competitive Sprint Cup teams and JR Motorsports will continue in the Nationwide Series. In 2009, Chevrolet will support 10 NASCAR Sprint Cup championship contending race teams: 4 with Hendrick Motorsports, 2 with Stewart Haas Racing, and 4 with Richard Childress Racing (RCR).
The Stewart announcement provides Chevrolet and GM Racing a major conquest in the pursuit to fend off the aggressive maneuvers of Toyota Motorsports and Toyota Racing Development (TRD). As a former business partner of TRD and the Lee White led organization, I look forward to the strategic plans and business maneuvers of Toyota Motorsports in the quest for NASCAR dominance.

The U.S. Navy will not return next year as sponsor of the No. 88 JR Motorsports Chevrolet owned by Dale Earnhardt Jr. and driven by Brad Keselowski.

“We were informed last week that our sponsorship with the U.S. Navy will not renew at the end of the year,” said Mike Davis, director of communications for JR Motorsports. “It has been an exceptional partnership since 2005, and we look forward to a strong finish to the season.”

Brad Keselowski is currently second in the Nationwide Series champion standings and won at Nashville earlier this year. This announcement is another huge blow to the fledging Nationwide Series, which has also seen icons like Richard Childress Racing (RCR) – unable to retain their Nationwide Series sponsors. NASCAR continues to face tremendous obstacles – and yet, nothing is being done to help support the teams’ survival. Instead, NASCAR continues to implement “rules”, which are contrary to the best interests of the teams and the sport in general.
With growing financial uncertainty – NASCAR and teams should also fear – that the automotive manufacturers may begin pulling their financial support from the Nationwide series – this again, is another example of NASCAR putting their heads in the sand until reality comes knocking at the door.
One must believe – - if Dale Jr. is having a difficult time finding and retaining Nationwide sponsors -this series may face further set of debilitating setbacks.

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 these 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.

By JEFF WOLF
REVIEW-JOURNAL

NASCAR Craftsman Truck series driver Travis Kvapil, left, and 24-year-old team owner Alex Meshkin have teamed to win two races this season. COURTESY PHOTO

The past year of racing for Travis Kvapil has been so unique it makes the spelling of his last name seem like Smith or Jones.

It started at the end of the past NASCAR Craftsman Truck Series season when he had to sit in his truck after the finale in Homestead, Fla., until race officials determined whether he or Ted Musgrave had won the season championship.

Although the ruling favored Kvapil, his reign started under clouds of uncertainty as owners of his truck team had decided to cut him from its 2004 lineup.

So the 28-year-old from Wisconsin hooked his championship wagon to a team owned by Alex Meshkin, a 24-year-old Internet entrepreneur who never had owned a race team before starting Bang Racing late last year.

Adding to Kvapil’s gamble: Meshkin’s team would rely on the new Toyota Tundra in the truck series. The Japan-based manufacturer had a proven history in other forms of racing, but this would be its first in one of NASCAR’s three major series.

It was a pair of long shots for Kvapil, but both gambles have paid off.

He will start Saturday night’s Las Vegas 350 truck series race as one of three drivers through 18 races who have won more than once this year. He has six top-five finishes.

With one year left on his contract with Meshkin, Kvapil has no regrets that he joined the youngest team owner in a major NASCAR racing series.

“I really believed in the program he was building, and I knew that Toyota would put good motors and trucks on the race track,” Kvapil said.

Kvapil and teammate Mike Skinner, the series’ first champion in 1995, are among four teams using Toyota equipment, but Kvapil is the only one who has won.

His second win was Saturday in Loudon, N.H.

“To get the second one makes a statement that this team is for real,” Kvapil said. “We’re contenders.”

Kvapil’s team is sixth in the standings with six races left and 188 points behind leader Bobby Hamilton. While Kvapil remains a contender for the season title, he also is looking toward next season when he and Meshkin move up to the NASCAR Busch Series.

“That’s the plan,” Kvapil said. “I wouldn’t say it’s 100 percent solid, but our sponsors are behind us to move up to Busch. (Meshkin is) working on some other sponsors, so we really have the money we need.”

Kvapil also denied rumors published last weekend that he was in line to replace Las Vegan Brendan Gaughan in the No. 77 Dodge for Penske/Jasper Racing in the Nextel Cup Series.

“It’s that time of year for rumors,” Kvapil said. “No one from Penske has talked to me.”

Meshkin, a native of Washington, D.C., said he expects to make an official announcement about his NASCAR plans in 45 to 60 days and it could include a second part-time team in the Busch series. He also said Kvapil will compete in some truck races next year to support one of the team’s sponsors that makes products geared to pick-up trucks.

“When we go Busch racing, it’s more competitive and you’re racing Cup teams,” Meshkin said. “It’s an opportunity to beat (teams like ) Hendrick, to beat RCR (Richard Childress Racing). That will give us the momentum when we go Cup racing.

“We won’t go racing in any series unless we’re going to be competitive.”

Meshkin’s first year in NASCAR has included a learning curve. A disagreement with Toyota over unspecified issues led the manufacturer to announce three weeks ago that it was pulling support from the team that would have forced Meshkin to find Fords, Dodges or Chevrolets for his drivers to finish the truck season.

A week later, however, Toyota backed off the threat, but Skinner left Meshkin’s team and began driving for Bill Davis Racing, another Toyota-backed program.

“When there’s stuff like that there’s always going to be distractions, but it was neat the guys in the shop never missed a beat,” Kvapil said.

Meshkin brings a new approach to NASCAR’s tradition-based world.

“I think we’re the most successful new team in NASCAR history,” he said.

“You can accomplish anything; it’s how you go about it. I think we’re more relaxed than other teams. By having a culture that has created unity, we are a more competitive team.”

http://www.reviewjournal.com/lvrj_home/2004/Sep-21-Tue-2004/sports/24812898.html