NASCAR Needs to Cut Costs. Now.
One of the most concerning aspects of NASCAR as a sport its monetary situation. Money has been short for many teams, leading to a lack of competition at times, as well as an influx of pay-to-play drivers, especially in the lower series. Now even Miller-Coors is moving away from the sport, decreasing its appearances on the car of Brad Keselowski and failing to renew its contract as the Cup Series pole award sponsor. When even the beer companies are backing out of the sport, you know there’s a problem. Many companies, even those that have been in the sport for decades, are not getting the returns on investment that they need to be able to justify staying in the sport.
What can be done about that, though? It’s a question that many in the sport are facing. The reality is that NASCAR (and sports in general, it seems, based on declining TV ratings) is just not as attractive to the mainstream, and, therefore, to major corporations as it used to be. Since NASCAR seems to be having a difficult time improving the on-track product to increase interest, the only way to address the shortage of money for teams is to cut costs. This has been discussed at length by nearly everyone in the sport, especially in the lower series, where the problem is even more severe. Composite bodies, which are cheaper than the carbon fiber bodies used currently, were tried out in a few XFINITY Series events last season, and will likely be utilized by all of the top three touring series in the coming years. Spec engines, which are pre-built engines, rather than engines built by teams, have been considered in the Truck Series, and may be utilized as soon as next season. This would save money currently being poured into research and development as well as engine building. Also in the conversation is a spending cap for teams, which would both level the playing field between teams and save teams money.
All of these potential changes would allow sponsors to get involved at a more realistic price because teams would need less money to fund their efforts. This also allows new teams to get involved in the sport in an era where many have fallen by the wayside, in large part due to ridiculously high costs.
Unfortunately, these changes could come with a couple of major drawbacks. First of all, the initial costs of switching to composite bodies and crate engines could be hard on teams. While teams will save money in the long-term, it may set some teams back in the short-term, especially those that are lesser-funded. The bigger worry for many, though, is the loss of jobs that may result from these measures. If teams and manufacturers no longer build their own engines, many, if not all of those working in that department will lose their jobs. The same goes for fabricators in regards to composite bodies. While the teams will save money, many of those at the shop may be job searching in the near future.
There’s nothing great about what is going on financially in the sport at the moment, but NASCAR has a chance to recover it and are considering their options, from spec engines and composite bodies to a spending cap for teams. Many may be put out of jobs because of these changes, but it might be necessary for the sport to remain competitive, relevant, and, in the long run, alive.