Just five or six years ago, $4 million or so annually would subsidize a full run in the Winston Cup Series. Now it takes a minimum of $8 million to $10 million to become, or remain, a legitimate threat week after week. Top teams are reportedly getting between $12 million and $16.5 million annually.
Uncertain economic times have forced companies to scale back advertising and marketing budgets. That makes it even tougher to find companies willing to invest in a race team.
As many as nine Winston Cup teams were searching for 2002 sponsorship deals as the 2001 season entered its last quarter. Among them, Melling Racing, a Winston Cup competitor since 1982, which lost sponsorship from Conwood Sales Company and its Kodiak brand.
"The problem is the economy is a little sour, and we've lost so many sponsors who were in the game and aren't coming back," says team owner Mark Melling. "That's what makes it tough. It's easier to get people who already have had it in the budget to spend it again, but people who have to carve $8 million or $7 million or more for a new program into their budget when everybody's cutting back, that's making it really tough."
NASCAR itself has experienced the same sponsor troubles. It has operated its nationwide Weekly Racing Series without a sponsor for two seasons. If NASCAR-with all of its sales and marketing resources-has conducted a futile search for sponsorship for two years, it stands to reason that teams within the sport are struggling to find backing as well.
In September Andy Petree Racing, which fields two Winston Cup cars, announced a new two-year deal with Schneider Electric, parent company of Square D, one of the team's sponsors. However, with Oakwood Homes not coming back next season due to a downturn in the mobile home industry, Petree was still searching for a sponsor for his other car as the season drew to a close.
"It's very difficult, I'll be honest with you," Petree says. "We've got a very good campaign going, and we've talked to a lot of quality companies ... But right now it's tough. We have gotten some 'nos' from people and it's because they're unsure of the direction of the economy and where their particular sector or company is going. It's not been an easy thing. It's just like everybody else is going through, not just in racing."
Reducing the cost of competition is the obvious solution to sponsorship woes, but Petree says NASCAR has neglected that issue.
"The number one thing to do is start looking at it," Petree says. "Just pay attention. Focus on it. Winston Cup racing is the only major racing series in the world-including Formula One-that doesn't limit the amount of tires you can use in a weekend."
NASCAR took at least a small step in the right direction as the 2001 season drew to a close. Beginning next season, teams will be limited to one engine for racing and qualifying, as NASCAR eliminated engines used specifically for qualifying.
With the sport on a growth cycle and enjoying the fruits of a booming economy, the need to address other cost issues has probably not been at the forefront. That, Petree says, will change.
"We were in good times," he says. "Now I think the sport is going to have to pay for that."
Busch Series/Truck SeriesNo part of NASCAR needs a boost as much as its two developmental series, Busch Grand National and Craftsman Truck. Fields were less than full last season, costs were higher, and both series' prestige and stature within the marketplace took a hit.
The Busch Series, in particular, has drawn criticism for a change in engine rules put into effect during 2001, a change designed to make Busch engines more like those in Winston Cup. According to estimates within the industry, the change tagged as much as $750,000 onto each team's engine bill for the season.