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Motorsport Games has been reportedly on the hot seat to lose their NASCAR license, and now we have an official source saying that may actually be happening. In their second-quarter earnings report, Motorsport Games had this to say about the NASCAR license.
Due to the uncertainty surrounding the Company’s ability to raise funding in the form of potential Capital Financing, and in light of its liquidity position and anticipated future funding requirements, the Company has decided to explore strategic alternatives and potential options for its business, including, but not limited to, the sale or licensing of certain of the Company’s assets. For example, the Company is currently in discussions with a third-party for the potential sale of the Company’s NASCAR license. If any such strategic alternative is executed, including the consummation of a sale of the Company’s NASCAR license, it is expected it would help to reduce certain working capital requirements and reduce overhead expenditures, thereby reducing the Company’s expected future cash-burn, and provide some short-term liquidity relief.
Motorsport Games
There it is, straight from the official source. Motorsport Games is talking with a third party about selling the NASCAR license. What does this actually mean for Motorsport Games and NASCAR gaming should this sale actually happen?
If Motorsport Games were to sell the NASCAR license to a third party, it’s hard to see a scenario where it does not stay as an exclusive license to whoever it is sold to. Who that company is, we do not know, but, that license is the most valuable it can be if it is exclusive. It is one of the best assets that Motorsport Games has, and, if they need cash flow, this license will give it to them.
If the license is not exclusive, then it does not mean nearly as much to third parties. At that point, those companies can just negotiate directly with NASCAR instead of working through a middle-man. If Motorsport Games is selling this license, it probably is still exclusive.
If Motorsport Games is looking at selling the license, then they have no use for it. Why would they hold on to that big of an asset if they are not going to use it while losing ridiculous amounts of money every year? Motorsport Games needs cash flow, and if it will not come through making a game, then it has to come somewhere. That place is likely selling the NASCAR license.
If Motorsport Games is indeed done with NASCAR, then that means that there will not be a new NASCAR game for a long time. How long? Well, the average Triple-A title takes about three years to develop, so, we are looking at potentially 2026 or 2027 if following that time frame.
Even if Motorsport Games miraculously keeps the license, NASCAR 21 Ignition is a broken game, and they may have to start completely over. As a result, it still would be at least another year or two for a NASCAR game to be released.
Motorsport Games is the one who has the license, so, at the end of the day, they are the ones who control where it goes. However, the license is tied to a contract with NASCAR, so NASCAR definitely has to have some input on how this goes down. NASCAR may not have total control over where it goes, but, given the spot Motorsport Games is in, NASCAR likely has a lot of leverage.
However, it does mean that NASCAR cannot just sell its license to the highest bidder because Motorsport Games is the one selling it. It is about all parties working together, not just what NASCAR wants.
The era of Motorsport Games making NASCAR video games is all but over. Someone entirely new is likely about to come in and create a NASCAR video game, and it means that a new NASCAR gaming generation is about to begin. It is something that NASCAR gamers have been looking for for a long time.
Now that we have official word on the situation, all we can do is wait and see. Motorsport Games is likely selling the license to someone, and NASCAR gaming is close to starting a new generation.
