NASCAR 2009: Economic Impact

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The financial crunch the world is in has already touched the NASCAR world in a big way.

The garage area has shrunk in the wake of the economic woes that have hit the sport and sent NASCAR into a frenzy of layoffs, mergers and downsizing.

Close to 1,000 people are estimated to have already lost their jobs with race teams across the Sprint Cup Series, Nationwide Series and Camping World Truck Series as organizations deal with tighter budgets and smaller sponsorship funding.

"I've never quite seen the garage like this," said Bill Davis, who was forced to sell his Sprint Cup and Truck Series teams despite winning the truck title in 2008. "But then again, we've never had these huge budgets and these huge payrolls. Maybe this garage is going through an adjustment period, just like the business world does. It happens. When things get tight, you adjust and scale back. Unfortunately, that involves hard times for some people."

While Davis sold his team in the wake of the financial issues, others have taken the merger approach. DEI and Ganassi Racing formed a marriage only a few months ago that is still being formalized while Gillett Evernham Motorsports and Petty Enterprises are expected to join forces at any time.

The overall situation is one NASCAR has experienced before, although never at this magnitude, but CEO Brian France believes the sport will weather the storm.

"We've had various other times where the economy has been very difficult," Brian France said. "This probably to everybody is more significant, at least on the surface. So there is a big uncertainty about people's ability to do all the things that they want to do financially, given the backdrop of the credit crisis and all the rest.

"We are nervous like everybody else. We’re taking every precaution we can in terms of getting costs out of our system on behalf of the team owners, on behalf of the track operators. But this is also a time when you can't freeze either. You've got to still be aggressive and still push hard your product."

NASCAR has taken some measures to help save teams money including the introduction of the new Sprint Cup Series car, which was an added expense during its initial rollout but is expected to cut costs as teams will be able to reduce their fleet of cars.

The sanctioning body also banned testing for the 2009 season a move that some estimate will save Sprint Cup Series teams $3-$5 million this year.

The financial problems for the "Big Three" auto manufacturers is a major problem NASCAR is keeping a close eye on as the new season rapidly approaches.

Although Chrysler, Ford and General Motors have pledged their continued support of NASCAR racing, budget reductions have already started. Chrysler cut its NASCAR expenditures by thirty percent with the other two Detroit-based manufacturers preparing similar actions.

Factory support has been absent from NASCAR before, but any kind of pull back will dramatically impact the sport's health.

"Do we have our eye on things? Absolutely. As an industry we're doing what we can," said Andrew Giangola, Director of Business Communications for NASCAR.

"NASCAR has been around for 60 years. We've been racing when the stock market's been booming and racing when the stock market's been through difficult times. America's love affair with the automobile is certainly not going to diminish anytime soon."

The economic story overshadowed Jimmie Johnson's third straight championship in 2008 and promises to be a continuing theme into the 2009 season.

Related Topics:

NASCAR Sprint Cup, 2009, Daytona 500

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