The Tight in Turn 2 Team Looks at: Wall Street, NASCAR and Other Venues

At the moment, the market crash has stopped swirling completely around the drain but that doesn't mean we're out of the woods yet. And if we're not out of the woods, how are mainstream sport entities faring?

NASCAR has situated itself in a pickle of bits. They've grown the sport in a reasonable fashion and in so doing, are asking comparable prices for such exposure and popularity. But can NASCAR sustain the return on the advertising dollar?

It may no longer be the prudent financial decision to sponsor a team from $10 to $25 million a season. That kind of advertising is pricey these days, especially when you can probably get a better deal with a direct ad on television itself. Or can they? If there is continued meltdown, future financial expectations will be affected. As it was, we can see swaths of empty seats at some of the NASCAR venues.

In other spectator sports, some venues with the largest stakes to lose are those that have heavy debt financing for acquisitions or stadiums and other sports that don't have the income from national TV deals and income producing components like long-term lease agreements on luxury suites in stadiums.

Even the NFL is pondering a limit on teams' access to an NFL managed line of credit.

Here's an eye opener: Britain's soccer leagues have amassed $6 billion debt for their venues as a whole. WOW!!

With these kinds of tidbits of info floating around out there, I have to wonder just how well NASCAR can fare the financial storm that not only just plowed through everyone's wallets, but next year while we still deal with the after affects?

Bruce: As it stands, there are around 26 teams that right now have full time sponsors and others like are juggling multiple sponsors to cover a year, like Stewart Haas Racing is doing with Ryan Newman, and the Army only sponsoring his car for a partial year.

Sadly, I think the monster teams will survive better than the smaller teams and in a fantasy worse case scenario, it's all going to end up under one garage roof: The Hendrick Childress Roush Evernham .... well, you get what I'm saying.

NASCAR may have very well priced itself out of some sponsors markets and wallets and it will be interesting to see how the teams will fare and if NASCAR will have to actually step in and lend a helping hand. It's hard to predict, but if we take another market hit like we just did a few weeks ago, you can bet we'll see something in our beloved sport affected by it.


Hey Charlie Turner, over there at On Pit Row. What's your take?

Charlie: Well, NASCAR doesn't exist in a vacuum. The current economy has affected the teams and the sponsors in the sport. Things will change. But it's a cycle. And a cycle that NASCAR has weathered before.

The sport is just too strong to fail as a system. Individual teams and sponsors will undoubtedly fail. Remember all the "dot com" sponsors of just a few years ago? Remember Ginn Racing? It happens.

Maybe the current climate will cause the topic of franchising to re-surface in a big way. I'm sure that it's proponents will sieze the day, if they think that they can.
But NASCAR will go on. The casual fan will probably not notice anything has changed. It's the fanatics like us, the hardcore fans that will note the passing of manufacturers and familiar paint schemes. For about a month.

Remember how tramatic it was for Junior to leave DEI and the Budweiser #8? What number and sponsor was Mark Martin inseparable from? Life goes on. NASCAR will too.


Charlie does have a point about how the sport will go on, but I don't have the confidence in sponsors that maybe I should have.

Over on Charlie's site, he asks:

According to various reports, Felix Sabates and or Chip Ganassi are predicting that NASCAR will reduce the size of starting fields in the three top series to as few as 36 cars. Do you agree?

Go see what we have to say on that issue over On Pit Row.