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Sunday, July 13, 2014

RTA ISN'T CART BECAUSE NASCAR ISN'T USAC

NASCAR's real reaction to last week's Race Team Alliance announcement was easy to see to those with experienced eyes. And who really know something about the Business of Racing.

One thing that surely stung in Daytona Beach was this news came just a couple of days after Brian France's upbeat mid-season press conference. Ouch!

The first clue came in NASCAR's statement regarding the new business collaboration of nine multi-car Sprint Cup teams. In my PR career I've seen what happens when people are caught flat-footed and the sanction essentially was in this case. One signal was the brief statement was attributed to the Chief (Non) Communications Officer (and architect of the dehumanizing Integrated Marketing Communications department.) Here's an industry truth: When a statement is attributed to a spokesman (no matter his title), not a principal, that means the bosses want to keep several arm-lengths away from the issue. (Mike Helton talking at New Hampshire Motor Speedway  -- noteably in front of the NASCAR hauler, not the higher-profile and more formal setting of the media center -- doesn't change that. It was just a repeat using a voice instead of a piece of paper/ Internet space. It was a PR/political necessity. Silence, in this case, would not have been golden. It would have shown a tin ear.) And the wording yielded further insights about the sanction's stance which then, tellingly, took a defensive tone. I'll reprint the statement here but please note the bold inclusions are added by me for emphasis:


“We are aware of the alliance concept the team owners have announced, but have very few specifics on its structure or purpose. It is apparently still in development and we’re still learning about the details so it would be inappropriate to comment right now. NASCAR’s mission, as it has always been, is to create a fair playing field where anyone can come and compete. Our job is to support and strengthen all of the teams, large and small, across all of our series and we’ll continue to do that. NASCAR is a unique community with hundreds of stakeholders. They all have a voice and always will.”

You bet. Those sentences are not that much far removed from those issued by USAC in 1979 when team owners under the CART banner started their own series. But the RTA is no CART, despite what you might have read/heard from some media who pretend to understand how racing business and politics work, and I'll explain more here shortly.

The second clue came from NASCAR.com. In case you don't know it, that site's editorial content is now under NASCAR's direction, not Turner's. NASCAR.com provided no story on this breaking news, just a posting of the PR statement. That says a lot, just as, in a different context, did the lack of on-site coverage of Kurt Busch's Indianapolis 500 effort. 

Let me assure you RTA is about -- surprise! -- money. Let me also assure you RTA is not going to be CART because NASCAR isn't USAC.

Politics makes strange bedfellows. We saw that with Bruton Smith, who has had his own issues with the sanction, stating at New Hamp that he's "shoulder-to-shouder" with NASCAR as it pertains to the RTA. Translation: Smith is worried his cut of the TV money will be reduced.

So, as I posted on Twitter ( @SpinDoctor500 ) last week, have no doubt the RTA is about money. As in taking more in and sending less out. As NASCAR's new TV deals with Fox and NBC start next year, reportedly worth more than $8 billion during its span, I guarantee you Hendrick, Childress, Gibbs, Roush, Penske, Petty, Stewart-Haas, Ganassi and Waltrip want a higher percentage of the distribution. I can assure you they know the Formula One team owners pounded on Bernie Ecclestone for more of the worldwide TV income. One way you'll be able to tell if NASCAR honestly is nervous about the RTA is if it reduces its own 10 percent slice of the TV dough pie. I doubt it. And with ISC having committed up to $400 million to "re-image" Daytona International Speedway, with ISC, Smith's Speedway Motorsports and Dover all being public companies that have to answer to analysts and shareholders and which already have taken a significant hit on ticket sales revenue in recent years, you can see why that collective will resist having its percentage reduced. Please note this huge difference: The track companies are public companies; the race teams are private companies.

The RTA has referred to trying to leverage its collective business to get a better group rate on hotel rooms, travel and insurance. Watch for this: If RTA negotiates such contracts, will it give NASCAR a taste of it just for political sake, or in some cases could these be in conflict with NASCAR's own "official" partners or even will NASCAR claim what RTA has done has damaged its ability to negotiate such "official" deals?

A few dollars saved on hotels or whatever, added up over a full season, still would only count as a relatively small reduction in owner costs. But with the value of sponsorship teams have been able to obtain or keep way, Way, WAY down from the pre-2008 Wall St. crash highs, any CEO or COO or CFO will say any saving helps. Believe me, they'll take it.

There are plenty of other issues to concern the Big Time owners. NASCAR continues to fiddle with the cars and bodywork and now is talking about horsepower reductions. All of this, in Brian France's continued push to attain side-by-side racing, has come with a price tag. As I also put on Twitter last week, RTA is guaranteed to re-ignite talk about franchising. It's worth remembering that franchises were once part of the CART business model, which, at least on paper, established some value on team ownership. It was one of the few good biz moves in that era of CART. Franchise owners got more prize money and could sell the asset of the franchise if they so wished. Cup team owners have none of this.

With all of that said, and despite what some "experts" have reported, RTA is no CART because NASCAR sure ain't no USAC. I was around in that era, first as a Philadelphia Daily News sportswriter, and then as CART's first communications director, and then as a sponsor/team representative. USAC in the late 1970s was a weak organization. It didn't have strong leadership, it lacked financial resources (for example, it was only getting around to owning its own headquarters building) for the necessary level of marketing and public relations, it didn't have a vision, and it suffered the terrible loss of key officials in the 1978 airplane crash. It lacked a Big Picture business plan. It's Board of Directors, which included car owners from the sprint, midget and even stock car divisions, made rules and other decisions which directly impacted the Indy Car team owners, and they (understandable to me) didn't like it. Dan Gurney's famous "White Paper" created the spark that eventually led to (the first) CART-USAC split.

NASCAR, obviously, has the France family in firm charge. All of the other things that were negatives for USAC don't apply here. And, NASCAR has that $8 billion-plus backing-it-up going forward. (I would assume, though, that those TV contracts specify a certain number of cars and probably some other items like X number of the top X drivers/teams in points to be in the field. When I did CART's first TV contract with ESPN for the 1981 season, for example, we had to guarantee a minimum of 18 cars. So that does, at least in theory, give the RTA some leverage.) I can also guarantee you Roger Penske has no interest in creating a new sanctioning body and will/would warn others again it. Recall that Penske, as CART's co-founder, eventually left that series for the IRL.

Here's a sort of Bottom Line, at least for now: How Big a Deal the RTA really turns out to be will be up to the RTA's Big 9, not NASCAR. Will they "ask" NASCAR for things, or will they "demand"??? 

But, as Jimmie Johnson (who didn't mention driver contracts when talking about reducing costs) admitted when asked about a driver's organization during his media availability at New Hamp (bold emphasis mine), “That opportunity is definitely there.  I don’t know where others stand and feel with it.  I haven’t put any thought into it myself.  I guess in some ways Pandora’s Box has been opened with this topic and discussion.  We will see where it leads."

Will the RTA ultimately be Pandora's Box or the toy surprise inside a box of deliciously sweet  Cracker Jacks? The answer to that question will tell you if the news value of this story is LeBron returning to Cleveland, or Joe going to Kokomo.



This will be the last "off" weekend of the Sprint Cup season. So I'll use that opportunity to assess the impact of NASCAR's new "win-and-your-in" Chase system in this Sunday's (July 20) Arizona Republic ( www.AzCentral.com ). Part 2 will be Monday (21st). 



Those on Twitter @SpinDoctor500 saw this first: Of summer, baseball and drag racing -- My first CompetitionPlus.com column in more than three months:
http://www.competitionplus.com/drag-racing/editorials/28643-michael-knight-the-boys-and-girls-of-summer-kinda-sorta


Good news is always welcome. I recently was notified of three honors earned in the 2013 International Automotive Media Awards. All three stories appeared in the Arizona Republic.  My in-depth exclusive on Mark Martin's stepping-away from driving took the gold medal in the newspaper news category. It also won the overall "Best of" in the newspaper category. That's the second time in three years I've got a "Best of," the other being in 2011 in the Internet commentary competition for the much-discussed "Untenable" blog. Also: My Q&A with Danica Patrick got a silver medal in the interview category. My feature on A.J. Foyt got a silver in the personality profile category. Thanks to all, especially you, the readers, who help make such things happen -- and meaningful.

more next Monday . . . ]