A perfect storm of unfortunate circumstances led to the sale of Leavine Family Racing, owner Bob Leavine explained on Tuesday morning. He has sold the building, charter, and inventory. However, the cars will go back to Joe Gibbs Racing, the team’s alliance partner.
In his initial statement, Leavine referenced the pandemic that forced the sport to shut down for over two months, noting its impact on his organization, and reiterating it was one of the reasons he is leaving NASCAR.
“Our biggest sponsor over the years has been WRL, our construction firm. That has been impacted (by the pandemic) and will continue to be impacted for the next several years,” said Leavine. “That was a big factor, and the business model of NASCAR, sponsorship.
“Obviously, when the pandemic hit, we shut down. We looked at our marketing people and said, ‘We’re going to be lucky to sell $50,000 worth (of sponsorship) for the rest of the year, because even big companies are going bankrupt. They can’t invest in something that has no more return than what they are going to get during a pandemic.’ So, the business model itself hurt.
“It was a perfect storm, and with that (pandemic) coming, NASCAR shutting down, and the business model, and our biggest sponsor – ourselves – all those things combined. Matt [DiLiberto], my partner, the largest real estate firm in New York — they’re hit tremendously hard. It was a perfect storm in the wrong direction.”
Leavine did not reveal who purchased the team and would not go into financial details. The buyer will announce the news.
Christopher Bell is driving the team’s No. 95 Toyota in his rookie Cup Series season. LFR hired Bell and received further technical support this year from both Joe Gibbs Racing and Toyota, which was on the level of the former alliance between Gibbs and Furniture Row Racing. Leavine has been a single-car operation since joining the NASCAR Cup Series in 2010, and has only been full-time since 2016.
Leavine purchased a charter in 2017, which guarantees a team a starting spot in each race. NASCAR went to the charter system in 2016 with officials issuing 36 charters to teams who showed long-term commitment to the sport by attempting to qualify each weekend. Charter teams receive a fixed portion of the race purse.
One hope of the charter system was to create value for race teams. However, Leavine said if his team had been one of those who received a free charter (when NASCAR issued them), “it probably would have been more impactful. Being one of the ones how had to buy our charter, we definitely did not get out of the charter what we put into (it). So, from our standpoint, it’s very difficult to say that it was a great investment. It just allowed us to run full-time for the five years after we bought it. That’s the best thing I can say for the charter system.”
According to Leavine, the organization is not only putting in the same amount of money they anticipated but more anticipating additional sponsorship. That was before the pandemic, however. Leavine doesn’t believe they will sell anything going forward, but is committed to running as they have been through the end of the year.
“We had a whole lot of things banking on the Next Gen coming in,” said Leavine of NASCAR’s new car, which has now been pushed to 2022. “Our deal with JGR required us to do certain things, and we were looking forward to being a standalone team with one or two cars. So, the pandemic and the sponsorship and how it affected WRL, our major sponsor; and then having to come back and buy cars for next year (when) we had planned on not needing cars for next year… It was a snowball effect on multiple things, and we saw no way out.
“We could not afford the affiliation, what we did this year, for next year, and that’s what we banked on – ‘OK, we’ll do this one year, run well, get our charter value up’ – and we had a plan; and it all came tumbling down with the pandemic. The pandemic and then you take a bad business model — it doesn’t work for us.”
Despite his feelings, Leavine is not advising against buying into a NASCAR charter. Those who have ties to large companies with business-to-business opportunities can make it work, which didn’t fit with what he was able to bring to the sport.
Leavine admitted that before the sport returned from its shutdown, he had lobbied NASCAR for things to change with other owners. He would not go into detail, but said he was disappointed in the outcome of the meetings, and knew it was probably going to be the straw that broke the camel’s back.
From there, Leavine started to look at out how to protect his team and keep people employed.
Ultimately selling the operation was “probably one of the most difficult things I’ve encountered and had to do because of our ten years. I really gave it all I had for the 10 years, and the last five when we went full-time. I committed, and I thought we could make a difference and be a good team – a responsible and respected team in NASCAR. To walk away and not have completed that… I’ve never had to do that before and give up on anything. But I could not let it destroy our 41-year-old business in Texas during these times. You have to protect something, and that’s a profitable organization; and I can’t rape, pillage and plunder.
“It’s like having two kids and deciding which one lives and which one doesn’t. It’s gut-wrenching because everybody in here is family, and to have to stand in front this morning and tell them what we were doing and how we wanted to go out with our heads held high – that sounds really good and reads really good, but it’s really difficult to do.”