Key issues facing NASCAR, Race Team Alliance

John Harrelson

The Race Team Alliance was formed to give NASCAR car owners a larger voice in the direction of the sport. But just how they decide to go about wielding their power remains unclear.

When the Race Team Alliance announced its formation Monday it was a departure from anything seen in NASCAR recently. At a time where nothing stays secret for long, the notion that the sport's nine most powerful owners could meet, form a consensus on a business coalition and no one would have an inkling of the proceeding was a surprise to say the least.

Now that the news has sunk in and the dawn of a new era is on the horizon, everyone is wondering what's next? As of now that's an open-ended question filled with great ambiguity. With the exception of chairman Rob Kauffman, the RTA has been mostly tightlipped about their intentions.

What is evident, though, is that RTA holds far more bargaining power than any group that's ever gone head-to-head against NASCAR. The nine car owners operate 25 full-time teams and every marquee driver of note is under contract to an RTA member. A heavy hand to play if NASCAR is resistant to any reforms the RTA might recommend.

But long-term, the agenda of the RTA might look something like this.

Streamlining expenses

If the goal of the RTA is simply to develop and implement a better business model, starting by consolidating their costs for lodging, transporting crew members to races as well as insurance deductibles would be the easiest.

"By working together and speaking with a single voice, it should be a simpler and smoother process to work with current and potential groups involved with the sport," Kauffman said in a statement. "Whether it be looking for industry-wide travel partners or collaborating on technical issues, the idea is to work together to increase revenue, spend more efficiently, and deliver more value to our partners."

In layman's terms the RTA wants to negotiate group rates instead of each team handling it themselves. From the onset this is one of the main areas of emphasis for teams.

Greater input on rule changes

More recently NASCAR has been more open about including teams in forthcoming rule changes in the form of town hall meetings. But that was the sanctioning body extending a hand to owners and there was no obligation for NASCAR to utilize any suggestions given.

That won't necessarily be the case going forward with teams now having more say in the approval or rejection of any technical changes NASCAR wants to implement. After all, it is the owners who since had to foot the bill for a completely new car last year and in 2015 a new engine package. Both have come at great expense and with input from the teams.

In the future it would be no surprise to see teams resist and possibly outright reject new rules due to the costs associated.

Schedule realignment

NASCAR has long talked about revamping the Sprint Cup schedule. Changes could come which would better accommodate its television partners, the tracks, and fans who frequently see early season races plagued by inclement weather.

All the above makes sense on a variety of levels, yet car owners say they have a different approach in wanting to see the schedule altered: common sense.

Per tradition each season begins with the Daytona 500 and from there travels to (in order) Phoenix, Las Vegas, Bristol (Tenn.), Fontana (Southern California), Martinsville (Va.) and then to Texas (Dallas/Fort Worth).

Does it make sense from a business standpoint to crisscross the country multiple times? No, especially when a more practical schedule is in everyone's best interests.

Owners would be best served pushing for a schedule akin to the PGA Tour where they have "swings" through certain regions. The PGA Tour opens the year in Hawaii for two events then goes to California and Arizona for six consecutive events. Very manageable and cost effective for golfers, who like NASCAR teams and drivers are essentially independent contractors.

TV money

What's the No. 1 goal of the RTA, and the issue that will create the contentiousness with NASCAR? Likely, obtaining a larger percentage of the $8.2 billion television contract NASCAR negotiated with Fox and NBC, which under the current distribution model sees tracks get the biggest cut, 65 percent, with teams getting 25 percent and NASCAR 10 percent.

Members of the alliance will argue that they are the ones who assume the most risk, as NASCAR has no central franchising system like the stick-and-ball sports where each organization is worth a tangible amount.

Therefore car owners have little to no protection. One high-dollar sponsors bails unexpectedly and all of a sudden Joe Gibbs Racing or Roush Fenway Racing is spiraling into debt, where their assets would only fetch pennies on the dollar on the open market.

NASCAR's counter-argument is teams should allocate their resources better and not spend excessively. As independent contractors, owners are not bound to the sanctioning body to compete -- be it weekly or yearly. And there is certainly no requirement that owners must field multiple cars, which all members of the RTA currently do.

How does this play out?

Now there are certainly ways car owners could cut back on spending and better allocate funds. Nevertheless, there is no denying that teams deserve a bigger piece of the financial pie.

From NASCAR's perspective the RTA eventually might evolve into a positive -- though a certain headache in the short-term.

If the RTA does indeed cuts costs and makes being a NASCAR team owner more affordable, it could create an infusion of new team owners. This then would potentially diminish the clout the current members of the RTA wield, as NASCAR would be less beholden to the demands of the nine owners.

That said, if politics and infighting breaks out between NASCAR and the RTA then there is some serious trepidation.

The last thing NASCAR needs is a replica of what happened in open-wheel racing where car owners became empowered leading to a severe decline in the interest of IndyCar racing. The split between Championship Auto Racing Teams (CART) and the Indy Racing League (IRL) was detrimental. Open-wheel racing has never recovered in the United States with minuscule television ratings and, outside of the Indianapolis 500, a general lack of interest.

A civil war is a long way off, however. Too much is at stake for NASCAR and the RTA to not reach some sort of compromise. Think of this as a 500-mile race with the green flag just coming out.

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