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Wednesday, November 7
Economy adds stress to sponsor hunts
Talk in the NASCAR garage area each fall revolves around who is driving for whom the following season.
It's no different in the waning days of 2001. But with a slumping economy, car owners say discussions this year about sponsorship have a greater sense of urgency.
"When you've got owners like Cal Wells and Andy Petree still looking for sponsors, that says a lot for the economy," said Mike Brown, general manager of Bill Davis Racing.
Petree has been looking for a sponsor for the No. 33 Chevrolet since the spring, when North Carolina-based Oakwood Homes announced it was leaving. The company pinned the decision on the slowing market.
"It's been one of the toughest years I have seen," Petree said. "The economy's in such a pinch that people are putting off decisions until later in the year."
Petree said he wanted to keep Nemechek in the car, but he let him go as the search for sponsors continued. No doubt, the car owner will spend a portion of his weekend in Homestead, Fla., continuing that chase as well as trying to win the Pennzoil 400.
Nemechek is expected to drive next season for Travis Carter in the Kmart Ford. Jimmy Spencer is leaving that ride, reportedly to take a three-year deal with Chip Ganassi.
Meanwhile, Cingular Wireless, which sponsors one of Ganassi's Dodges, will jump to Richard Childress Racing. Cingular it will sponsor a third Winston Cup car for Childress.
That decision, however, had little to do with finances.
"Clearly we want to be in the winner's circle," said Cingular spokesman Clay Owen. "It does make good business sense for us."
Childress was the car owner for six of the late Dale Earnhardt's seven Winston Cup titles.
Despite NASCAR's immense popularity -- especially with sponsors who love cars that serve as billboards for their products -- financial backing is a problem that has grown even more critical in the wake of the terrorist attacks.
Oakwood is not the only sponsor hit by the economy. Others are shedding thousands of jobs, including Delphi Automotive, 11,500; Sara Lee, 8,400; Sprint, 7,500; Kodak, 6,000, and DuPont, 4,000.
Mark Melling, owner of Stacy Compton's Dodge, understands reservations sponsors have about laying off workers, then plunking down millions for racing. But young teams such as his need those deals to survive.
Longtime NASCAR sponsor Kodiak is leaving the team. Melling will field a car in February in the season-opening Daytona 500. After that, there is no guarantee his Dodge will be back on the track.
"We can't run a full schedule without a sponsor," Melling said. "We'd be limited. It's a very expensive sport."
Melling also is uncertain about a driver for 2001. Compton has been told that if he gets an offer before Melling lands a sponsor, he should take the ride. It's not a scenario either would have chosen.
"He's been tremendously loyal and supportive," Melling said of Compton. "We're just beginning to gel and we need that momentum."
Compton is talking to as many potential suitors as he can find, but accepts the reality of the marketplace.
"The sport has gotten awfully expensive," he said. "That's hurt the smaller teams."
Petree said the new rule of using the same engine for qualifying and racing will save team a few million dollars a year, which will reduce overall costs and free money for research and development. He has considered melding three primary sponsors for $3 million and rotating logos on the car.
"It doesn't take what people think," Petree said. "It doesn't have to cost $12 million to $14 million."
NASCAR realizes the predicament, but is confident the sport is strong enough.
"We have more Fortune 500 companies involved in our league than other sports league in the country," said Brett Yormark, NASCAR's vice president for corporate marketing. "They can weather anything."
He said the growth NASCAR is experiencing and the continuing expansion into new TV and merchandising markets are proof of the sport's popularity.
"Those are all good reasons to stay with us and spend," Yormark said.
Still, proven winners are still looking for sponsors. That tells Brown something.
"In years past, there have been four or five new companies that come into the sport," he said. "We're not seeing that this year. It's not enough to fill all the needs."
Davis announced last month that driver Hut Stricklin and the Hills Brothers sponsorship will move to his garage next year. Dave Blaney, who had said he would be leaving Davis at the end of the year, is going to drive for Jasper Motorsports.
Brown said sponsors already in a wait-and-see mode before Sept. 11 have really held back recently. He said it might be mid-January before some teams know their status for 2002.
He also wonders about the ability to have enough teams to fill the traditional 43-car field, something Yormark says is unlikely.
NASCAR works with teams to help them secure sponsors, he explained.
"We're the only league out there that really drives revenue in their direction," Yormark said. "There are no biases. Ultimately, everyone wins."Send this story to a friend | Most sent stories
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