What’s Happening?

It’s been floating in the background of the minds of all NASCAR fans, drivers, team owners, and executives. While there is general confidence amongst many in the sport including Steve Phelps, Jeff Gordon, and Brad Keselowski that a deal will get done eventually, it’s all within the context of a virtual stalemate between the owners and the race teams.

Well, if the worst does happen and a charter deal is not reached what happens? The answer may actually give fans some hope that a charter deal will be reached.

• The charter agreement between the teams and NASCAR has been in place since 2016. Essentially, race teams purchase a charter with guarantees them a certain amount of prize money and a starting spot in every race in exchange for committing to compete in every race.
• The current agreement is up at the end of this year. Without an agreement, NASCAR takes away the charters of the race teams, and the race teams have the right to form their own racing series.
• Fans are nervous about the current charter talks. Many just want to see the deal done, but, they also want to see a fair deal for the race teams.

Read Also:

NASCAR’s Upcoming Civil War? Everything You Need to Know About the Charter Negotiations

The Doomsday Scenario

We’ve discussed at length a few times what the worst-case scenario could be if the team owners and NASCAR do not agree, particularly in the article above, so, here’s the cliff notes version. If the charter agreement runs out, the race teams no longer have any contractual obligation to NASCAR, so, the race teams could theoretically start their racing series.

We’ve seen this happen before in other sports. There was the infamous CART/IRL split in the 1990s. There’s also the LIV Golf and PGA Tour competition going on right now in professional golf.

However, splits rarely end up being a net positive. IndyCar, for example, has never fully recovered from the CART/IRL split. TV ratings and attendance at races are down from those periods, and IndyCar is routinely beaten by NASCAR and sometimes even Formula One in TV viewership.

However, a split would be very complicated, and there are plenty of different factors to consider. These complications should give fans some hope about where these charter talks could go.

What Would a Split Entail for Race Teams and Owners?

The Timing/Cost

If the race teams and the team owners decided to split from NASCAR and form their own racing series, that would be a very tall task. It’s not something that just happens overnight. For example, Tony George announced the formation of the IRL around two years before the series held its first race in 1996. That first season featured only 5 races on the schedule.

With that in mind, thinking about building cars, TV contracts, deals with race tracks, and everything in between, it’s tough to see that these teams could make their own series in 2025. Maybe they could join another circuit like the CARS Tour, but, they have nowhere near the brand that NASCAR does.

Maybe they could rely on someone from overseas to help fund things, but, that’s a tall task. It would also run the risk of taking these owners away from their core audiences, which are NASCAR fans.

Race Tracks

There’s also the complication surrounding NASCAR’s other assets, particularly race tracks. First off, NASCAR owns 15 race tracks across the country including all of the following: Auto Club, Darlington, the Chicago Street Race, Chicagoland, Daytona, Darlington, Homestead-Miami, Iowa, Kansas, Martinsville, Michigan, Phoenix, Richmond, Talladega, and Watkins Glen. That limits which race tracks that team owners could go to, and it’s part of what gives NASCAR leverage in these negotiations.

The majority of the rest of the race tracks are owned by SMI, which includes Bristol, Charlotte, Dover, Kentucky, Las Vegas, Nashville, New Hampshire, North Wilkesboro, Sonoma, and Texas. Now, SMI is technically not owned by NASCAR, but, they work closely with NASCAR. If the teams cannot convince SMI to stage races in this theoretical scenario, that further limits which track teams can go to.

Eight race tracks in the United States are independently owned that have hosted or currently host NASCAR including Circuit of the Americas, Indianapolis, Lucas Oil Raceway in Indianapolis, Mid-Ohio, Pocono, Portland, Road America, and Gateway. That’s a pretty limited schedule, and team owners would have to get creative to create a full schedule.

These Splits Do Not Normally Work

There’s also the whole issue of these spin-off series and leagues not normally working in other sports. There are many examples of rival football leagues going up against the NFL including the WFL in the 1970s, the USFL in the 1980s, the XFL in the 2000s, and the AAF in the 2010s, all of which folded after 3 years or less. The UFL is getting started this year after a merger between the new USFL and the new XFL, and the future of that league remains to be seen.

How did the CART/IRL split end after the 1990s? The two entities ended up merging back together in 2008. The PGA Tour and Liv Golf have been holding active merger talks as well.

Having leagues competing against each other just does not work with sports leagues. Eventually, it usually all ends up under one entity in the end, whether that means a merger or one league falling out.

What Does This Say About the Current Negotiations

Starting some sort of a breakaway league would be very difficult for race teams to pull off, and rarely does anything like this work out well for everyone. This should strangely give fans some optimism about the charter negotiations.

With not only the IndyCar split but also the history of breakaway leagues in sports history, it’s not a good idea for either side to allow a split. This gives both NASCAR and the teams motivation to keep working with each other,

It’s also very difficult to imagine the team owners making it happen in likely less than a year. It’s a big deal trying to form something like this, and it takes a lot of planning to make it happen. Therefore, it would likely benefit the owners to stick with NASCAR.

While this possibility does exist, NASCAR and the team owners would likely never fully recover if a split happened. It has the potential to kill NASCAR as we know it. However, there is no better motivation than the consequences of a potential split to keep NASCAR and the team owners at the negotiating table.