NASCAR team owner says sport should enact a spending cap
Andrew Murstein, co-owner of Richard Petty Motorsports, says NASCAR team owners need to agree to a spending cap to create a “level playing field’’ in the Cup Series.
“Every single league has a cap now these days, it creates a level playing field,’’ Murstein told NBC Sports. “It’s salaries … its wind-tunnel time, it’s the whole kit and caboodle. It’s better for the fans, I think, if there is a level playing field. No one can outspend the other guy. It’s better for the owners. It creates more competition, more excitement.’’
Murstein’s comments might seem hollow in a season that has seen 10 consecutive different winners heading into Sunday’s Cup race at Watkins Glen International. Nine different teams have won Cup races this year with no organization winning more than four races.
That balance appears to be an anomaly. In nine of the previous 10 seasons, one organization won more than 25 percent of the races each year. Joe Gibbs Racing won 38.9 percent of the races in 2015 — the highest percentage since Hendrick Motorsports won 50 percent of the races in 2007 with Jimmie Johnson, Jeff Gordon, Kyle Busch and Casey Mears.
Murstein, founder and president of Medallion Financial Corp., said he raised his points about a spending cap to NASCAR Chairman Brian France at a dinner last month in New York that included John Tisch, owner of the NFL’s New York Giants.
“(Tisch) was shedding a lot of light on why that league was so successful,” Murstein said, “both from fan interests and from the economics of the sport.’’
Murstein said France appeared open to his ideas “if we came up with some more details.’’
NASCAR has stated that its three most important components are safety, competition and costs. The sanctioning body has created a number of rules, including limits on engines used during a race weekend and tires that teams can purchase for an event to help owners cut costs. For the third consecutive weekend, Cup teams are on track two days instead of three, helping cut a day of travel expenses. Last weekend, owners had to submit votes on potential rule changes intended to help defray costs and balance competition.
Murstein, whose company was involved in the purchase of Richard Petty Motorsports in late 2010, said he would like to see more done toward an overall cap on spending. Such a move would be revolutionary for a sport where owners do not share their financial information and athlete contracts are kept secret.
“I think this sport needs to start coming up with revolutionary concepts, so they have to leave the past in the past and they have start looking to the future,’’ Murstein said.
Because teams are not the same size, there would have different cap amounts. It would be unreasonable to have Richard Petty Motorsports, which is fielding one team this year, have the exact same cap as Joe Gibbs Racing, which fields four cars. Still, proportional caps could be created for each team to help keep costs in line. Murstein suggested independent auditors could monitor the spending.
Should teams spend beyond their limits, Murstein has a plan. A luxury tax.
“Kind of punish the ones that don’t care about spending and that extra money goes into a pool that would help the other owners, and hopefully they would use their money to make their cars more competitive, too,’’ Murstein said.
While Murstein is looking to cut costs, he understands that drivers are underpaid relative to other athletes. As teams struggle to find sponsorship, driver contracts take a hit.
With the new generation of racers, it’s easier for an owner to go with a younger driver, who can cost less, than a veteran. Former champion Matt Kenseth does not have a ride for next year. Stewart-Haas Racing did not pick up the option on former champion Kurt Busch’s contract for next year but tweeted it still expected him to drive for the team next year.
“I do think that even the older drivers, when they come off their contracts, they’re seeing the reality of the sport today and they’re willing to take pay cuts,’’ said Murstein, whose team seeks to renew deals with sponsor Smithfield and driver Aric Almirola. “It’s one sport where there are so few seats. NBA athletes, there’s what 30 teams, about 360 professional athlete. Here you’re talking about 40. It’s probably the hardest sport to be a superstar in.
“I see hockey guys who play a third of the game make $17 million a year. Now you’re talking about (drivers) who are 10th best in the world at what they do getting only salaries of $5 million, so I actually think their salaries are low compared to other sports but the business needs that right now with the sponsorship decline.
“I love the fact of how no other sport has a partner with the athletes where here the athletes get 40 percent of the race winnings. So each race they go into as your partner vs. other sports where they win or lose, it makes no difference at all.
“There are a lot of bright sports in NASCAR, too. I’m just trying, as the new kid on the block, to throw new ideas out there. Some of them will get knocked down right away, which they should because I don’t have the experience that a lot of these other team owners do, but they have to start thinking, in my view, of new and better ways to get the fans interested.’’
Murstein said he understands a cap likely won’t be instituted soon. He admits it could start with more standardized parts for teams.
“I think you probably settle that you’re going to start at parts and pieces but that’s the wrong way to do it, which is probably what will happen,’’ Murstein told NBC Sports. “I think it will happen because it will be the easy one to do. It won’t remove the 800-pound gorilla, which is all the other costs involved and dealing with that. Maybe you tippy-toe into it by starting that way and then eventually you look at the overall spending.
“The sport could even evolve years from now where there’s one manufacturer making all the Toyota cars. That’s the way I actually think it should be. That’s 100 percent the way it should be.’’
For teams that provide chassis to other teams, it seems unlikely they would want to give up a way to make money.
“At some point there’s a tipping point, you have so start looking past … I think you’ve got to point the sport back in the right direction,’’ Murstein said. “It’s a fantastic sport. I go to every other sporting event in the world and none parallel NASCAR, but the direction of it right now needs to be, I think, spun a little bit differently.
“It could happen if the owners get together and I’m sure the ownership of NASCAR would be behind it, so I think it’s more an ownership issue than a NASCAR issue.’’