What Is With The Charter Leases Lately?

Ryan Blaney

What is with all the charter leases that have happened in the last month in NASCAR?  Race fans there is a logical explanation that I will try to elaborate on and fully explain the nuances, even though it maybe be a little tricky!  In other words, I will try to connect all the dots!

Wood Brothers Racing’s Ryan Blaney will have a guaranteed starting spot in NASCAR’s Cup Series in 2017 as part of a series of deals that includes Richard Petty Motorsports leasing one of its charters to Go FAS Racing.

Go FAS Racing, which fielded the No. 32 car for Jeffrey Earnhardt and other drivers last season, will lease its charter (NASCAR’s version of a franchise) to the Wood Brothers for 2017, said Wood Brothers Racing executive Jon Wood. Blaney qualified for every race last year, finishing 20th in the standings, but now will have no worries about having to qualify in 2017 if more than 40 cars show up at a race.  So that relieves the pressures of trying to qualify  in the top  echelon to put the car into the big show each week.

Matt DiBenedetto, who drove for BK Racing last year and finished 35th in the standings, will be the sole driver for Go FAS Racing in 2017 and also will have no worries with a guaranteed spot in every race as Go FAS Racing vice president Mason St. Hilaire confirmed that it has leased the RPM No. 44 charter for 2017.  Are you following me?

An RPM spokeswoman said the team had no comment Thursday night about its charter situation nor its 2017 plans. It has driver Aric Almirola with primary sponsor Smithfield signed next season for the No. 43 car but has been in limbo with the No. 44 car since the surprising retirement announcement of Brian Scott in November.  You can bet the farm that RPM is just entering one car in the 2017 season.

Why all the leasing of charters you might ask? It’s part of a complicated NASCAR system designed to encourage performance while also allowing teams to project revenues for a season.

At the start of 2016, NASCAR issued 36 charters, giving those 36 cars a guaranteed spot in each race and a guaranteed base amount of revenue for the season. That left four spots available to “open” cars, whose base amount of participation revenue is less than 35 percent of that of charter teams.

Now here is where things get a little complicated and somewhat muddled, so pay close attention to the details.  Teams can lease out their charter for only one year over a five-year span and then must either run it or sell it. A portion of the revenue distributed to a charter team is based on the performance of that car the past three years; plus any car among the three worst charters for three consecutive years can have its charter pulled by NASCAR.

The move for Go FAS Racing means it will have slightly more guaranteed money next season because the RPM No. 44 team’s past three-year history is better than that of Go FAS Racing’s No. 32 team!

It also should make the original No. 32 charter more valuable for 2018 in two ways: Wood Brothers Racing should finish higher in the owner standings (it was 21st in the 2016 team standings) and therefore would increase its 2018 guaranteed revenue; and it should eliminate a chance the charter could get revoked following the 2018 season because it most likely won’t be among the three worst charter teams for three consecutive years.

With this more detailed explanation of how NASCAR can revoke charters, how these teams get paid after the races, and the projected value placed upon those charters, now possibly you can connect the dots yourself and see how valuable that some of these charters can be and why a few of the smaller, back-markers who have charters and are trying to keep their charters, as well as increase the potential value.

Are all the dots now connected for you?  I hope that now you will have a more clearer understanding about the subtle nuances of charter ownership in NASCAR.

But like always, the bottom line is all about revenue, money and team value!


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