HAMPTON, Ga. (AP) — NASCAR is at an impasse with Michael Jordan, and how it ends could potentially be very complicated for both sides.
After more than two years of tense negotiations on a new revenue agreement, Last weekend, NASCAR finally secured 13 organizations — all but two — to sign a new agreement.
The deal was reached less than 48 hours before the start of the NASCAR season. playoff opener at Atlanta Motor Speedway, and several teams told The Associated Press they felt compelled to accept what was billed as a “take-it-or-leave-it final offer” as time ticks toward the signing deadline.
It may not be the victory NASCAR would like.
Who didn’t sign the agreement?
Jordan and the 23XI Racing team he co-owns declined to sign the deal Friday night. Front Row Motorsports, a much smaller organization, surprisingly took the same stance as the powerhouse 23XI team.
23XI and Front Row are the only two current charter organizations that have not signed extensions through 2031. Due to a non-disparagement clause NASCAR added to the latest offer, almost none of the teams that signed are willing to speak on the record about the negotiations and how they ultimately abandoned three of their key demands.
23XI is largely represented in the charter fight with NASCAR by co-owners Denny Hamlin and Jordan confidant Curtis Polk, who arrived in Atlanta with two typewritten pages of notes he read to reporters explaining why the team did not accept NASCAR’s offer.
Polk described the fight with NASCAR as “David versus Goliath,” with NASCAR essentially threatening to cut charters if the deal wasn’t accepted by midnight. He said other teams “may have felt pressured and forced to sign the deal under significant duress.”
23XI’s position was that the terms were “particularly detrimental to our operations and the interests and intellectual property rights of our ownership group.”
What do the teams want?
Teams have consistently wanted four things in charter negotiations: a bigger share of revenue, a seat at the table on governance issues, a share of the commercial deals NASCAR makes using team or driver likenesses and, most importantly, for the charters to become permanent, ensuring stability.
Jim France, son of NASCAR founder Bill France Sr. and current chairman, never planned to make the charters permanent, and that became a major sticking point. The final offer did not include permanent charters; it also contained provisions that would allow the France family, which owns the series, to hold charters and field its own teams, according to several team owners.
Jeff Gordon, vice president of Hendrick Motorsports and a key member of the team’s negotiating group, simply shrugged about the decision to sign the charter agreement when asked by The Associated Press. He noted that Jim France had had one-on-one meetings with several prominent team owners — a strategy Hamlin described as “divide and conquer” — and that most of them felt they would never get a better deal from NASCAR.
The new charters do indeed provide teams with increased revenue, but it is unclear to what extent.
Several teams told AP the document was riddled with grammatical errors and wasn’t ready to be signed. The teams sent revisions — requests, really — to NASCAR, and NASCAR’s response arrived at 5 p.m. Friday, running 105 pages long.
According to Front Row owner Bob Jenkins, the document couldn’t be revised in time to meet a looming deadline. The team shares many of the same concerns as 23XI, and Jenkins noted, “I know a lot of people were uncomfortable but felt compelled to sign.”
RFK Racing co-owner Brad Keselowski disputed the idea that teams felt “forced” to sign, instead saying teams had reached a point where NASCAR would no longer give them anything.
He would not call the new charter agreement “fair” to the teams.
“It’s one of those deals that’s only good when everybody’s a little jaded,” Keselowski said. “I think there are things that we’d obviously like to improve, but I think to some extent there are elements that we really like and elements that we don’t really like. But it’s hard to use the word ‘fair.’ I don’t know if I know what that means.”
What happens next?
It’s not yet clear what 23XI and Front Row will do next.
Polk would not say whether the team would take legal action after previous lawsuits. consultation with one of the country’s top antitrust and sports law attorneys. If 23XI wants to go to court, it could try to force NASCAR – a private, family-owned company – to open its books publicly.
“This is not the 1960s anymore, and these predatory practices will not stand up to scrutiny and will not be accepted in 2024,” Polk said. “NASCAR has superior negotiating power and undue influence over the sport and the charter process. They have exercised that power consistently over the past several months and have consistently rejected teams’ blanket requests on major issues while making minor changes on pet issues that individual teams have requested in individual meetings.”
Polk did not respond to questions about why NASCAR wants to pursue Jordan, a global superstar who is attracting a new audience to the sport and is one of only two Black owners in the Cup Series. Polk said the last discussions between 23XI management and the France family were in May.
“I’m not going to speculate on what we’re going to do,” Polk said. “We’re going to protect our rights and we’re going to do whatever we have to do to protect them.”
But he was clear about 23XI’s position and questioned whether many of those who signed are even aware of what is in the 105 pages.
“The contract offer removed essential rights, and we believe that all teams, including those that signed, may not have had a meaningful opportunity to negotiate or fully understand the implications of the terms of the contract,” he said. “It is important to fully consider the long-term implications of these terms, which could be detrimental not only to all teams, but to the sport as a whole.”
There are nine races left in the season and both 23XI and Front Row are trying to expand to three cars for next year. They will theoretically need charters to do so, and for now those charters are set to be revoked at the end of December.
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