The Next Gen car could do more than impact the action on track. It could help revolutionize team ownership.
More than a season before the Next Gen car debuts, the car and the sport’s focus on cutting costs have lured new owners into the sport.
Within the last few weeks, two new teams revealed they’ll join the Cup Series next year with charters. Denny Hamlin and Michael Jordan announced in September they will form a new team with Bubba Wallace as driver. Justin Marks announced this week that his Cup team, Trackhouse Racing, will debut next season with Daniel Suarez as the driver.
There were only three new full-time teams that entered Cup from 2018-2020. Two had charters.
Jordan said in an interview with NBC Sports and Fox that after his financial advisors examined the business model of NASCAR team ownership, he told Hamlin that “there’s an interest there and then everything started to present itself.”
Said Hamlin: “I believe NASCAR is taking steps to help the financial model for the owners. This is why it was a great time for us to come in when we did. I’m going to make sure Michael is in this sport for a very long time.”
While the Next Gen car creates added expenses for teams in switching to that vehicle, the expected benefits are long-term savings. Other changes include NASCAR limiting how many days teams are at the track, limits on how many crew members can go to the track and reduction of wind tunnel time for teams.
NASCAR President Steve Phelps noted in September that there has been increased interest in team ownership.
“I would suggest that the number of new owners trying to get into this sport has never been higher,” he said. “Certainly when I’ve been around, and I’ve been around for 15 years. There’s just a ton of enthusiasm for the direction of what team ownership looks like.”
Challenges remain. The two new teams will debut with the current car and then switch their inventory to the Next Gen model for 2022. That can create a financial burden.
“I don’t know how the model can be sustained with these new owners, especially new ones coming in right now for next year knowing they have to buy old useless inventory and then essentially scrap it when it’s all done,” said Kyle Busch, who owns a Truck Series team. “That, to me, makes absolutely no sense.”
Even with those obstacles, Marks sees this as the right time to enter the sport.
“The barriers of entry to this sport over the past decade … have just been insurmountable to somebody like me that can’t really come in and spend $50 million,” he said. “When NASCAR announced that they were going to this new car, all of a sudden it was a huge light that went off inside my head that saw there was a tremendous opportunity.
“In going through the due diligence of figuring out how to put a team like this together during that process, the (Next Gen) car got delayed a year, but we built a structure of how to come into this sport for being very intelligent with our allocation of capital and very intelligent with our growth…