Due to the recent antitrust battle between Michael Jordan and NASCAR, curiosity has formed around the current situation and its details, with the public wanting more information.
Over the past year, the 23XI Racing team, co-owned by Jordan and his driver Denny Hamlin, teamed up with Front Row Motorsports and filed a lawsuit against NASCAR for its monopolistic business approach involving its new lease deal, whether it’s cars, auto parts or race roads, they profit from everything. On the other hand, the teams that bring them income fail to reach the break-even point.
With recent legal filings and internal communications during the trial, Jordan’s project no longer looks like a passion project, but rather a high-stakes strategic business model created to build on MJ’s already enormous wealth.
Court records revealed major details about how Jordan and Hamlin finance 23XI. It appears Jordan has made some bold financial moves regarding his NASCAR team, proving that to be a part of the top-tier Cup Series, you have to have very deep pockets.
According to motorsport journalist Bob PockrassJordan reportedly covered 60 percent of the cost of one of the charters purchased from Stewart-Haas Racing, while Hamlin covered the remaining 40 percent.
Additionally, for the team head office, “Airspeed”Jordan and Hamlin are 50-50 partners. It was established that MJ transferred the money to Hamlin, and that he reimbursed Jordan on a monthly basis. With this, Jordan loaned the team money to pay legal fees related to the lawsuit.
23XI Racing’s business model is very clear: they invest in infrastructure and long-term legal status, not just in racing. Because Jordan and his team do not accept the new charter agreement, their business model is seriously threatened because the “open” charter status is high risk and less profitable.
Last year, the court granted a preliminary injunction that allowed 23XI to retain its charter status while the judgment was pending. However, more recently, the same injunction was overturned by a U.S. appeals court, jeopardizing the team’s charter status and increasing the threat that it would be forced to race as an open team.
If that’s not enough, it appears there is friction between Hamlin and other 23XI executives, as Hamlin feels undervalued when financial decisions are questioned, which can further complicate business and legal strategies.
Related: ‘The Media Ain’t Playing’ – Michael Jordan Asked Players to Vote to End ‘Faulty’ MVP System
On the other hand, NASCAR pushed back and dismissed 23XI Racing’s accusations, stating that Jordan and his team are seeking a charter that no one else is seeking and that they have significantly increased payments to teams under the new charter system.
