The first attempt to use mediation between Chip Ganassi Racing and its driver Alex Palou as a method to find an agreeable solution to part ways came to a recent and unsuccessful end. With the specter of the contractual dispute waiting to be resolved in federal court if both sides fail to reach an amicable solution on their own, CGR and Palou agreed to give a second round of mediation a try in an effort to avoid going to trial.
“It’s true that there’s still mediation going on,” Palou confirmed to RACER. “It was looking like everything was gonna go super quick before the season ended, which would have made my preparation for the last races a bit chaotic and not ideal. But with the mediation and all the progress that’s been made since then, I’ve been able to focus. I think it’s good.”
RACER understands there is no specific timeline for the current round of mediation to end which, as Palou noted, has decompressed the urgency of the talks that will likely extend into the offseason.
It’s believed the first attempt to bypass the court and come to terms in a direct manner concluded with Palou and his current NTT IndyCar Series team being far from having their respective needs met. For the Spaniard, a desire to leave CGR for McLaren Racing has been the clear goal from the outset and remains unchanged. But it’s unclear if he will be granted a voluntary release by CGR to drive for McLaren in IndyCar, or as part of McLaren’s Formula 1 program, which awaits an answer on another contractual dispute it inspired between itself and the Alpine F1 Team over the services of Australia’s Oscar Piastri.
As Alpine and McLaren are on the clock to learn where the FIA’s Contract Recognition Board will assign Piastri to drive next season, Palou’s F1 aspirations also hang in the balance. Having qualified for the requisite F1 Super License by winning the 2021 IndyCar championship, Palou’s harbored a significant interest in sampling F1 with McLaren. However, if the team secures Piastri’s services, Palou’s door to racing in F1 could be shut for the immediate future.
Switching to the Arrow McLaren SP IndyCar outfit has been frequently portrayed as the logical fit for a race seat as Palou is known to be viewed as a replacement for Felix Rosenqvist in the No. 7 Chevy if Ganassi’s terms are met through mediation, or a judge sides with McLaren in the question over which teams holds the upper legal hand.
As the dispute with Palou enters its third month, the goals being pursued by CGR via mediation remain a mystery. With Palou’s heart set on leaving, fighting to keep him in a car he doesn’t want to drive would be futile. At the same time, the team would be better with him in the No. 10 Honda and wouldn’t want to face him as an opponent at AMSP or any other team, if it can be avoided.
So, what price would McLaren or Palou be willing to pay to be untethered from CGR? Ganassi isn’t known to be desperate for cash, but at the same time, would a release come without a sizable and statement-making transfer of funds into its bank account? Or would CGR agree to a split that includes a non-compete agreement that parks Palou for the next year or two? Whether it’s money or the forfeiture of driving privileges, a steep price will likely be paid by McLaren or Palou if mediation ends up bearing fruit.
Time could also play an increasingly important factor in how the contretemps is settled. A positive and expedited conclusion to mediation would seemingly benefit McLaren and Palou, while a failure and the start of a federal trial would appear to favor CGR.
If and when a separation occurs, Ganassi will have a long line of suitors trying to claim one of IndyCar’s most competitive entries. Although the free agent market within IndyCar has shrunk throughout the summer, a wide array of international options, promising junior open-wheel talent and series veterans exist for the team to receive if Palou needs to be replaced.
For McLaren, which has two of its three drivers secured with Pato O’Ward and the incoming Alexander Rossi, an offseason spent with the No. 7 Chevy sitting idle, as a protracted and costly legal battle over Palou leaves one of its major entries in limbo, could grow harder to justify. In the interest of moving forward with its full roster in place and giving itself ample time to prepare for the new season, would McLaren step away from Palou and take up its option on Rosenqvist?
So many questions and so few answers.