NASCAR's winners, losers in recent driver, sponsor swaps
Two major shifts in two weeks have left the NASCAR landscape quivering. It's more movement than in all of last season combined, and these pending sponsor and driver swaps for 2011 have everyone simply trying to keep their facts straight.
With so much news, let's stop and review the facts:
2) Shell/Pennzoil will leave
3) Kurt Busch has been signed to a long-term deal with Penske. Terms not disclosed.
4) Miller Lite aligns with Penske driver
While a lot to stomach, all of these changes connect to major themes surrounding NASCAR's future. So let's draw a few conclusions on these deals while you digest, shall we? Here are some winners and losers from the latest Silly Season drama:
"We're seeing a war waged between the sport's elite car owners," says a source. He's right. It would be impossible for Penske to stand pat without losing ground to a Hendrick organization that finished 1-2-3 in the point standings in 2009. So the second HMS grabbed its "A-level" driver of the future, Penske signed theirs (Busch) to a long-term deal while aligning its young star (Keselowski) with an "A-level" sponsor. The move will prove crucial in their long-term plan to unseat Hendrick at the top.
Another word describes Keselowski's attitude this week: relief. Sponsor Verizon's contract was up the end of 2010, a deal they inherited through a merger with Alltel. But due to NASCAR's exclusivity agreement with title sponsor Sprint, they're not allowed to use its logos on the side of the No. 12 car. Penske is noncommittal with Verizon's future, but reading between the lines of statements we've seen, it's reasonable to assume the cell phone company's on its way out. After all, would you dish out millions only to not get the visual exposure of your brand on the side of the car?
Searching for backing could have posed a distraction to this team as they build for the future. Instead, Penske's put additional faith in Keselowski, aligning him not only with a long-term partner, but one who wants him to stay exactly the same. Miller Lite is comfortable with the driver's personality, expecting him to continue an aggressive, independent style of handling issues on and off the race track. Plus, at 26, they can rebuild their brand toward a younger, twenty-something market the 31-year-old Busch was on the edge of growing out of.
Sources claim the Mobil 1 deal is on the low end of sponsorships these days -- about $10-12 million -- but that's enough to give the three-car team a major boost, particularly the JTG team driven by
With a long-term contract, the move does offer greater security for Busch. But for a man looking to increase his popularity, I'm not sure what partnering for an oil company does to accomplish that.
Moving forward, Childress is in a very difficult position to try and recover. With Hendrick support reaching out to as many as eight teams in 2011, he's far down the totem pole with GM support. But the real warning sign comes with his limited reach outside the sport. The reason Shell left Childress wasn't just performance, it was in the business-to-business relationships offered by Penske's 316 dealerships coast-to-coast. That ensured them they'd make more bang for their buck in case NASCAR's recent decline accelerated.
"Sponsors don't just want to be on the hood of a car anymore," says a source. "Those days are over." Right now, that's all Childress has to offer, and that's why he'll lose out on this deal. Budweiser might be his only hope, looking to partner with an icon in the sport for next season. If Childress could somehow get Harvick to re-sign although the chances of that are near zero, according to
Otherwise, considering all driver/sponsor contracts end after 2011, would that make the 64-year-old consider retirement? It's an option.
Another option could be moving Harvick's self-owned Nationwide team to Cup. But he's long expressed resistance to doing so, and the money may not be there to make it happen. That leaves him backed in a corner ... and there may be no way out.
But the second theme is more alarming. Notice all the top-level teams fighting over expiring contracts. This week wasn't filled with announcements about Wal-Mart, Wendy's or new Fortune 500 companies entering the sport. Where's the new blood, in the form of owners, investors, and sponsors coming in to replace companies jumping ship? Heck,
Sadly, the bloodshed is just beginning. With sponsor renewals at hand, NASCAR teams are asking their backers for more cash -- and that's a problem. Three straight years of declining ratings and attendance have companies laughing them out of the boardroom.
When sponsors balk, the rich survive, using their own cash to keep prices rising. But for the poor, the business model is broken: and until all parties agree to fix it, we're about to find out just how many blue collar fans follow a series comprised of just one economic breed of competitor: upper class.