NASCAR president Steve Phelps recalled his first state of the sport address when giving his opening remarks Friday at Phoenix Raceway about where things stand as the 2022 season draws to a close.
“Many of you were in the room in Miami when I had the opportunity to do this for the first time (in 2018), and I think at that particular time we were a sport that, frankly, was struggling,” Phelps said. “Our ratings were down; our attendance was down. There weren’t a lot of bright spots. I stood in front of you, and you talked about our best days being in front of us.
“I know that seemed kind of foolish, and maybe some of you were snickering…like, ‘I’m not sure that’s going to happen.’ But where we sit here today, I think that’s exactly what’s happened.”
Phelps touted that NASCAR’s ratings were up in 2019 and through the first four races in 2020. After navigating COVID, NASCAR was one of the first sports back in action and then the first to do so with fans.
Ratings are again up in 2022, with Front Office Sports reporting a four percent increase over last year.
There has also been an influx of new ownership recently. Even better, it’s with recognizable names like rapper Pitbull, who partnered with Justin Marks, basketball legend Michael Jordan starting a race team with Denny Hamlin, and now Jimmie Johnson returning to NASCAR and buying into Petty GMS.
On the schedule front, a race was run inside the L.A. Coliseum. Next season, NASCAR will run on a street course for the first time in Chicago.
When looking at Phoenix specifically, the track sold out its spring race for the first time in over a decade earlier this year. Sunday will also feature a sellout for the Cup Series finale.
“Again, thrilled for where this sport is,” Phelps said after also highlighting the Next Gen car and how exciting the playoffs have been leading into the finale. “Thrilled for where the sport is going as we head into our media rights negotiation next year, as we head into kind of unchartered territories with the Chicago Street Course. We are going to continue to be bold and we’re going to continue to be innovative.
“What I would finish with is what I finished with in Miami, which is I believe the best days of NASCAR are in front of us. I believe that to be true.”
There were nine sold-out races this season compared to the five the Cup Series had in 2021. Phelps believes NASCAR will hit double-digit sellouts next season as more new races hit the schedule despite concerns about economic issues affecting people across the country.
“I’m surprised that we’ve seen the type of consumer numbers that we’ve seen,” said Phelps. “Our consumer numbers are up over 20 percent — ticket sales ’21 to ’22, despite what was happening with the gas prices earlier in the year, or obviously the very true inflationary things that are happening.
“We haven’t seen a decline in ticket sales. We haven’t. We’ve actually seen the opposite. I don’t understand it, frankly. It’s a bit puzzling. We are one of the only sports that, by and large, held ticket prices flat over the last four or five years. I think that NASCAR is one of the best places, from a value perspective, for our race fans. The opportunity to bring in coolers, trying to keep our ticket prices in a manageable place, having different options for our race fans to be able to buy different levels that will work for their own budgets.
“It’s something that we’re going to keep an eye on for sure because we want to make sure that the grandstands are packed.”
For all the positives Phelps mentioned, he couldn’t ignore the flip side. Work on the Next Gen race car continues, particularly with safety improvements. Steve O’Donnell, NASCAR COO, revealed there are also aero changes coming for short tracks and road courses.
A new charter agreement is also approaching. Phelps wouldn’t rule out the possibility that it goes away but said he believes it’s been a good thing for the sport and will continue after the current deal ends in 2024.
On the financial side of things, NASCAR and the teams are working through a new media rights deal. The teams have been outspoken in recent weeks about wanting a bigger slice of the pie and how far apart they are from what NASCAR responded with.
Phelps said NASCAR wants teams to be profitable because it translates to competitiveness. If NASCAR is going to continue to have good days, the on-track product and health of its teams remain top of mind.
“There are two areas to do it — increasing revenue, which we have every intention of doing with our race teams, and controlling expenses,” he explained. “The teams have asked us to control expenses. Where those come from, I don’t know. That will be up to the race teams to determine the best way to figure out how they would control those expenses.
“I’m not suggesting that we have a specific discussion around what that would be or the mechanisms that we put in place. The teams have thrown out the idea of having caps, floors and ceilings, and luxury taxes. There are all kinds of different things and levers we could pull, but those conversations will be between ourselves and our race teams. We’ll continue to have a dialogue with our race teams.
“The charters go through the end of 2024. We will have meaningful dialogue with our teams next year, I’m sure. We’ll figure out what is going to be a fair opportunity for all stakeholders. Moving forward in 2025 — what that looks like, I don’t know, but it will absolutely have to be around both revenue increases as well as some type of expense restriction in some way.”