The future of Stewart-Haas Racing has become one of the most closely watched topics in NASCAR, with sponsor departures and on-track difficulties raising questions about whether the company could reduce its Cup Series operations to four cars as soon as next year. The organization is co-owned by NASCAR HOFer Tony Stewart and businessman Gene Haas, the latter of whom is also the 100% owner of an eponymous F1 team. Haas is considered the wealthier of the duo, although the exact distribution of equity between the two is unclear.
SHR has won championships in several NASCAR series since its inception in 2008, and it has been widely considered one of the premier teams in NASCAR during that era. This includes Kevin Harvick’s 2014 Cup Series championship. But last year, the team lost what was likely an eight-figure annual sponsorship revenue with the departure of major blue-chip brands. Anheuser-Busch And Smithfield Foodsas well as the departure of the smaller but still notable Hunt Brothers Pizza brand.
Compounding the problem is that three of the team’s four cars missed the playoffs in 2023 and its main star, Harvick, retired after the season. Additionally, the team’s large contract with Ford expires after this year, which could result in another dramatic reduction in the team’s revenue. Teams rely on sponsorship for about 60 to 80 percent of their annual revenue, meaning departures have a more dramatic impact in NASCAR than in stick-and-ball sports, where sponsorship revenue tends to be a much smaller slice of the teams’ pie.
In a welcome development, SHR has gotten off to a better start on the track so far in 2024. But despite this, sports industry executives have identified SHR as one of the teams, if not the team, most likely to sell one or more charters before 2025. It could not be confirmed whether SHR has already begun exploring the possibility of selling charters, but the possibility of the team doing so has become a hot topic in the garage in recent weeks, according to more than half a dozen from the industry. executives familiar with the subject. SHR declined to comment.
Rumors that SHR might sell a charter date back to last season, when the team’s struggles on and off the track were mounting. In fact, after the team won the Xfinity Series championship at Phoenix Raceway in November, a reporter from The Athletic asked Stewart about the possibility of selling a charter during his post-race press conference. At the time, Stewart responded, “Why are we talking about this on Saturday night when this guy just won a championship?” »
The most recent charter to trade was the one Spire Motorsports purchased from now-defunct Live Fast Motorsports for just under $40 million last year. As has been the case in recent years, any charter sales would be closely scrutinized by the industry for signs of whether charter prices are increasing, plateauing or decreasing. The value of charters has increased 11-fold in the last few years alone, but there remains intense debate in the industry over their value, with some bulls and others bears on whether prices will continue to rise. The charters guarantee predictable starting spots and revenue streams for teams in exchange for a team commitment to compete in all of NASCAR’s 36 points races each year.
However, the teams are currently in negotiations with NASCAR on a new governing agreement that would take effect next year, including whether and how long the charters will be extended. Since the charter system is technically set to expire after this year without a renewal currently locked in, investors outside of NASCAR are unlikely to purchase a charter at this time, industry executives said.
Only teams in the sport that are confident the system will continue in some form would be likely to purchase one at this time, but it’s possible that even they will wait for a resolution with NASCAR before further charter transactions take place.
Teams reportedly interested in possible expansion include Trackhouse Racing, 23XI Racing and Legacy Motor Club. Dale Earnhardt Jr.’s Xfinity Series team, JR Motorsports, has also explored the idea of purchasing a charter in recent years as it considers joining NASCAR’s premier series.
Given that it is considered one of the most dominant teams in NASCAR, the possibility of SHR downsizing would have been surprising just a few years ago. But in the sponsorship-dependent world of motorsport, a lot can change with just a handful of corporate partner departures.
