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NASCAR News on 06 20th, 2008
By Jerry Bonkowski, Yahoo! Sports 12 hours, 11 minutes ago
BROOKLYN, Mich. – Flowers and other lush foliage in the rolling and bucolic Irish Hills of Southern Michigan are in full bloom these days.
The area’s natural beauty, its quaint shops and unique restaurants – not to mention great racing – are among just some of the qualities that draw close to 300,000 fans to the two annual Sprint Cup races held at the nearby Michigan International Speedway.
This year, however, was different.
At last Sunday’s LifeLock 400, there were gaping holes in the grandstands, less-than-full campgrounds and the ridiculously easy traffic in and out of MIS, where three-hour gridlock is the norm. If there ever was a sign of the times, this was it.
NASCAR, like just about everything else these days, is feeling the impact of tough economic times, and it’s likely to get worse before it gets better.
“Fuel, that’s the reason,” seven-time Cup champion Richard Petty said last weekend at MIS.
To illustrate his point, Petty bent down, picked up a five-gallon fuel container, hoisted it into the air and pointed at it.
“No matter whether you have a car or not, the gas prices are hurting you; the diesel prices are hurting you,” Petty said. “Everything (costs) is being passed on. It’s inflating everything by the one thing, which is the fuel.
“Sure it bothers me, but more on an everyday deal, where they’re doing things like running the food prices up because the fuel prices are up, too.”
There’s no question that a sport so dependent upon fan support and sponsor dollars is hurting, and the pain is starting to get worse. While there were plenty of empty seats at last Sunday’s race in Michigan, MIS president Roger Curtis was thankful that even 100,000 fans – or about 30,000 fewer than normal – showed up.
“I’m just shocked at how many people we did have, because it probably could have and should have been a lot worse than it was,” Curtis said. “That’s a testament to the fans that were here.”
But for many of those who filled the MIS stands to only about 75 percent capacity, it wasn’t an easy decision. They had to justify the cost factor before the racing factor.
“There were a lot of people who sat down with a calculator and pencil and worked on this over the winter and spring months and asked ‘Can we go? Can we make it? Do we want to make the sacrifices to get here?’ ” Curtis said.
“Clearly, with the holes in the grandstands, some people made a decision they couldn’t, and I understand that. But a surprising number of them said, ‘Yes we can. Yes we will. We’re still that passionate about NASCAR and still excited about going to MIS. It’s a special place and this is our vacation, not just a race, and we’re going to keep making the sacrifice as long as we possibly can.’ ”
Pain is spreading
Faced with spending several hundred dollars or more in fuel to travel to and from a race, plus hotel rates that soar as high as $400 a night on race weekends, the high cost of food and the actual price of tickets to get you through the door, many fans are choosing to stay home and watch races on TV.
By doing so, a domino effect is occurring. Not only are tracks starting to suffer, so are nearby businesses that are dependent upon race fans for a major chunk of their income – places like restaurants, convenience stores, gas stations and hotels.
Take the upcoming Coke Zero 400 (formerly the Pepsi 400) at Daytona International Speedway on July 5, for example. Normally at this time of year, just over two weeks away from the race, most hotel rooms within 50 miles of Daytona Beach would have been reserved.
But as of Wednesday, hundreds of rooms remain empty from Daytona to Orlando – and will likely remain that way. Folks simply just aren’t coming.
“It’s scary,” said the reservation manager for one mid-range Daytona-area hotel who requested her name and hotel not be named. “Right now, if the race was today, we’d have 30 to 32 rooms that are going to be empty on race weekend.”
But the slumping economy leaves hotels such as hers in a Catch-22 situation. On race weekends, most hotels double and even triple their regular nightly room rates. They could lower rates to attract more customers, but then they run the risk of making less per room while at the same time having rooms remain empty.
“We’re going to try and weather it and hope it gets better, but it’s looking pretty ugly right now,” the reservation manager said.
Teams aren’t immune
Fans aren’t the only ones suffering at the pump.
Teams have seen their fuel budgets spike as much as 40 percent. Those struggling the most are smaller teams with the leanest budgets.
“It’s been hurting us, there’s no question,” said driver and one-car team owner Robby Gordon.
Even the biggest organizations like Hendrick Motorsports are feeling the pinch. Fewer HMS personnel are coming to races just to spectate. More employees and family members are flying together on HMS planes, rather than piecemeal travel that might include cars or flying.
“We have to spend more money to get our trucks to the races or on planes to get our crewmen there, but that’s inconsequential if we can’t draw the fan support,” said HMS general manager Marshall Carlson. “We’ve seen incredibly good fan support even though it’s been a real hit in people’s pocketbooks. Fortunately, I think we’re putting on a compelling product that’s still drawing people.”
HMS’ fuel costs have climbed 25 to 30 percent since last season. Even though the company owns three turbo-prop planes (plus a corporate jet) that are more fuel efficient than their counterparts, it still has to pay a high price because of the volume of people and cargo it transports.
“We’re moving 100 to 110 people back and forth from the races every weekend, and we’re doing the airlift for JR Motorsports with its Nationwide team,” Carlson said.
While smaller teams may be substantially tightening their belts, things will remain status quo at HMS, mostly due to demand than necessity.
“We don’t envision cutbacks,” Carlson said. “We have not identified any area operationally that we’d adjust if conditions decline. As long as we can bring performance and service to our sponsors, then we’re always going to be able to have sponsors.
“That’s the bottom line for us. We’ve said before that in the absence of performance, nothing else happens. We’re more focused on being in the effective business than the efficient business.”
What is NASCAR doing?
The question begs to be asked: with the economy seemingly worsening every day, what is NASCAR and its International Speedway Corp. subsidiary doing to make things easier for fans to come to races?
While ticket and concession stand prices remain the same, tracks have tried to follow NASCAR chairman Brian France’s suggestion earlier this year to work with local businesses to give fans a little more bang for their buck.
That could mean anything from convincing hotels to lower their race weekend prices to convincing businesses to give away things like $20 gas cards to help soften the fuel hit.
While Curtis and NASCAR spokesman Ramsey Poston claim there’s been some progress, NASCAR can’t demand that hotels, rental car companies and other businesses radically reduce their prices.
“All we can do is to try and engage them,” Poston said, “to make sure these local business communities understand the larger issue here, not just making a lot of money on one particular weekend.
“Particularly in towns where there are limited numbers of rooms, places like the Martinsvilles of the world, we want to make sure they’re being fair to the fans and are charging a fair price. If hotels and rental car companies are gouging fans and charging too much, then they’re not going to come back and are not going to continue to patronize these places. That has an effect on everybody, the races and the local economy.”
Some doing better than others
Without question, Bristol Motor Speedway has the most sought-after ticket on the Sprint Cup circuit.
The half-mile bullring in the eastern Tennessee mountains has sold out 52 straight Cup races, dating back to 1982. No other track comes close to that kind of success and popularity.
Even though there were several empty seats in this year’s March race at BMS, those came from fans who chose to stay home instead of fight that weekend’s rain and cool temperatures.
Because it is one of the most popular tracks for fans to visit, BMS is not letting its ability to weather the economic downturn go to its head.
At the same time, track vice president and general manager Jeff Byrd empathizes with other tracks that haven’t been as fortunate.
“Nobody takes anything for granted up here,” Byrd said. “It’s tough for all of us and nobody wants to see empty seats. I think that everybody has a common mindset that we have to bend over backwards and do anything we can for the fans to make it easy for them to attend the races.
“We’re all in constant contact with each other. You have to be empathetic with the other tracks. Just because Bristol is the only race right now with a large number of seats that’s selling out both races, that doesn’t mean it won’t impact us down the road.”
Because of its location, Bristol has one of the smallest lodging bases on NASCAR’s Cup circuit.
BMS holds 165,000 fans, but there are only 6,000 hotel rooms in the surrounding 50-mile radius. As a result, it’s quite common for most hotels to charge $300-plus per night – most with a three-night minimum.
Until recently, hotels and motels in the area charged whatever they wanted. If fans didn’t like it, tough. There was always someone else who was willing to pay close to $1,000 for three nights lodging.
But with the current economic problems, Byrd has been able to convince many area hotels and motels to not raise rates any higher than they already are.
“The supply and demand with the hotels is not the best situation in the world,” Byrd acknowledged. “(But) I think we’re making some inroads finally with them.”
While NASCAR and ISC refuse to discuss the possibility of lowering ticket prices, Bruton Smith, chairman of rival Speedway Motorsports Inc. (which owns BMS and six other Cup tracks), is adamantly trying to save fans a few bucks.
First, he’s holding the line on ticket prices, particularly at Bristol.
“We’ll keep ticket prices flat for the foreseeable future,” Byrd said.
In addition, Byrd and Smith are close to an agreement with a major oil company to supply ticket holders with affinity cards, where fans who drive to BMS will be able to buy gas at a reduced price.
Byrd feels fortunate that his track has been able to endure the current downturn with minimal problems.
“I think we’re better positioned than anybody, simply because we’re dealing from a position of strength. Our renewal rate is still over 90 percent. I don’t know of any other track that’s above 60 percent right now.
“I think we have the best product in the sport,” he continued, “and if people start cutting out races, I personally believe that Bristol will be the last one they’ll cut out.”
Where do we go from here?
Back in 1973, as a symbolic gesture to show it empathized with the plight of fans during the OPEC oil embargo, late NASCAR chairman Bill France Jr. shortened several of the season’s longer races by 10 percent.
Among those: the season-opening Daytona 500 was actually the Daytona 450, Michigan saw one of its 400-mile events cut to 360 miles and Pocono saw one of its races trimmed by 20 miles.
As of now, NASCAR has no plans to shorten any events, Poston said. But that doesn’t mean things won’t change if the economy continues spiraling downward.
For now, NASCAR, its tracks and fans are all taking a wait-and-see approach to see how bad things get – or if a turnaround is in the cards in the coming months.
“It’s scary,” Byrd said. “You don’t know what’s going to happen.”
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