Front Row Motorsports has not turned a profit in its 20 years in NASCAR, according to a court filing from its owner, Bob Jenkins, who along with Michael Jordan at 23XI Racing is suing the privately-owned racing circuit to challenge the legality of its charter system, aimed at teams being able to get a bigger share of NASCAR’s $3 billion annual revenues.
On Wednesday, Front Row and 23XI filed a request for a preliminary injunction that would allow them to compete in the NASCAR Cup Series in 2025 while the suit plays out in court.
Both teams have indicated that they plan to compete in 2025 with or without charters, which guarantee teams starting spots, and are also tied to the limited revenue-sharing through which NASCAR will distribute 25 percent of the money from the new $1.1 billion-per-year TV rights deal to the chartered teams.
The risk of running as a so-called “open car” – that is, entering races without a charter – is that open cars get so little from a race’s purse that teams can’t cover the basic expenses of putting a car on the track.
“We’re pretty confident about this lawsuit, or we wouldn’t be doing it,” Jenkins told the Associated Press. “There’s a lot of money out there. I’m hoping NASCAR won’t fight the injunction, and we can move forward.”
Thirteen of the 15 NASCAR team owners signed charter extensions through the 2031 season last month, with some calling it a “take-it-or-leave-it” situation, because NASCAR had threatened to do away with the charter system entirely if the team owners didn’t sign.
Before NASCAR instituted the charter system in 2016, teams operated on year-to-year contracts that didn’t guarantee entry into races or a share of the TV or gate money, and team owners often found themselves competing with NASCAR for sponsorships.
The original 2016 charters were four-year deals, and were automatically renewed for a second four-year term ending on Dec. 31, 2024.
The negotiations for the latest extension of the team charters were centered around the demands of team owners for a larger share of the revenue pot.
Curtis Polk, a co-owner, with Jordan and Denny Hamlin, of 23XI Racing, told Autoweek that the new charter arrangement will distribute $400 million a year to team owners, in the neighborhood of 13 percent of the $3 billion that NASCAR brings in annually.
“Now, let’s look at the drivers. The drivers, 36 of them, probably average about $3 million a driver, $100 million (total), on a sport that generates roughly $3 billion of revenues. That’s 3 percent. Compare that to basketball, where the players make 49 percent, football, where it’s in 40 percent,” Polk said.
“It’s incredible that the people who go out there and entertain the fans and compete every weekend and risk their lives are only getting 3 percent of the gross revenues of the sport. As those things came to my knowledge, it was apparent that the system needed to be overhauled,” Polk said.
Video: Update on the NASCAR antitrust suit
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Chris Graham
