Commentary

You think your fuel bill is high? NASCAR teams in a budget squeeze

Pain at the pump is likely something everyone is feeling. It isn't any different for NASCAR teams, but maybe not in the way you would think, writes Marty Smith.

Updated: April 5, 2008, 10:51 PM ET
By Marty Smith | ESPN.com

Sensitive lead topic today, kiddies: Gas prices. It's something to which we can all relate, and it's dramatically affecting bottom lines all over the NASCAR landscape.

[+] EnlargeGas Pump
Rusty Jarrett/Getty ImagesThe racing fuel used by NASCAR teams at the track is free. The stuff that goes in the haulers, motorcoaches and airplanes they take everywhere? It costs them just like it does any other consumer.

Marty,

Good to write you again -- It has been since Jr. spun on purpose at Bristol a couple years ago. I want to know what the impact of the very high and rapidly rising fuel costs will be on NASCAR.

Will this come to a point where NASCAR is forced to shorten the races again? And is Sunoco feeling any heat from anywhere about supplying fuel to be burned up for our entertainment? I thought I'd throw that out there and see what comes back. By the way great piece on the finances that are threatening the teams we love from the glory days.

-- Shane, St. Louis

Great question, Shane. I read a story in USA Today recently about the ongoing effects of fuel costs on the airline industry, and a similar thought popped in my head: What about NASCAR? Should we be burning all this fuel for entertainment when gas is $3.25 per gallon?

This requires a two-part answer: 1. On the track. 2. Off the track.

As far as the actual events are concerned, NASCAR officials say its teams are not affected by the day-to-day fluctuations in fuel cost. Why? The gas Sunoco gives them is free, covered under a multiyear contract that ensures they will have fuel at each track. Essentially, fuel is provided cost-free from Sunoco to the teams as part of its exclusivity agreement with NASCAR.

Also, NASCAR's use of the racing fuel has no impact on the availability or price of regular gasoline. According to NASCAR, the amount of fuel used during races is insignificant when compared to the amount of day-to-day consumer use of fuel. On average, Americans use 366 million gallons of gas per day, compared to roughly 135,000 gallons per year for the Sprint Cup Series.

NASCAR, at this time, plans no change in race lengths.

That's on the track. Off the track is a different story entirely.

Between sending transporters to races and tests, and flying crewmembers all over creation, NASCAR's teams are feeling the pinch just like everyone else.

Michael Waltrip Racing GM Ty Norris told me over-the-road cost is up 35 percent in 2008. But the real cost is airplane fuel. Norris said they continually shop for more affordable prices, and three weeks ago landed 20 minutes south of McCarran Airport in Las Vegas in the effort to save money. The decision saved them $10,000.

Mike Dillon, the team manager for Richard Childress Racing, said his team has reduced its fleet of airplanes, from three Brazilia 32-seaters, a King Air and team owner Childress' personal jet, to one Brazilia, the King Air and RC's jet. With the fuel costs, Dillon said it's much cheaper to fly Express Jet, a charter company operated by Continental Airlines. Continental owns the planes, and thus assumes all costs incurred from fuel, upkeep and the like, Dillon said.

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And fundamentally, RCR has quit flying so much.

"We've been flying to Bristol for the last 10 years, but last week, all of our teams drove," Dillon said. "And you know what? Nobody complained."

While budgeting for the season, Dillon said they forecast the fuel price increase and increased the budget.

"We budgeted figuring gas would be $3.75 a gallon by midsummer, but it still hasn't covered [cost]," Dillon said. "It's crazy. It's big. But heck, rules changes and [racing] tires hurt us worse [financially] than that."

Exactly. Fuel cost is of minimal concern in comparison with other costs. The biggest expenditure for teams -- by a substantial margin -- is payroll. One single-car owner who requested anonymity told me that his payroll is roughly $3.5 million annually -- and that doesn't include the driver or crew chief. (I can't fathom what Hendrick Motorsports' payroll must be.)

The aforementioned team owner also let me in on some of his fuel cost increases this year. The cost of transporter fuel is up 15.4 percent, he said. Plane fuel is up 15.9 percent.

Fuel cost is an inexact budgetary item. It fluctuates, and the higher it goes the more catawampus budgets get.

"Fuel's driving some of it. It's the whole economy right now," Dillon said. "We've been really comfortable, and all race teams have lived high on the hog for a long time. People are looking at what's going on and changing their ways."

Especially teams like Childress, for which there are no car dealerships or truck rental companies on which to fall back.

They race for a living.

"That's right," Dillon said. "We have to pay attention to everything that's going on. We have to think leaner than in the past because the economy's that way right now. I'd say it's like every household in America. Everybody's crunched."

While Sprint Cup teams are hurting, Nationwide Series and Craftsman Truck Series teams search for new ways to help combat the fuel cost. Stacy Compton, co-owner of the Nos. 4 and 18 Truck entries, told me they're pursuing sponsorship opportunities just for fuel credit cards.

"That's something we've never done before, but with fuel prices almost triple the amount that they were three years ago, it's certainly putting a cramp on everything we're doing," Compton said. "Instead of asking for cubic dollars, we're offering to do things for you sponsorship-wise if you'll pay for the fuel for the haulers this year.

"You put [fuel] in the budget and pay for it, but in all honestly it's subject to be $5 a gallon before the end of season. That's a big bite out of the budget, so if you can get them to pay for it, it's a huge help."

Compton's team recently went to test a trio of trucks, but ultimately decided to leave one truck at home based solely on the premise that they would only have to send one transporter instead of two.

"We looked at it and said, 'This is dumb,'" Compton said. "We shouldn't spend the extra fuel for the extra hauler. You start looking at things a lot differently when you're talking about spending $600, $700 per fill-up.

"For smaller teams with limited budgets, you have to look at it hard. It's a huge dent. We budget for fuel increases, but still, it's a lot more money than anybody needs to be spending on fuel."

One other quick note on this: Fans are feeling it, too. My buddies spent nearly $350 in gas round-trip between Northern Virginia and Bristol last weekend.

Marty,

Everyone is piling on Jamie McMurray for being outside the top 35. One [writer] even said he can't save his season. He is a great driver and I will stand behind him. You need to give it to me straight here. What the hell is going on with Jamie? I'm in The Six, too. Answer my question!

-- Jamie fan Susan, Fenton, Mo.

He must improve, Susan. It's pretty simple. Roush Fenway Racing is arguably the best organization in the season's first six weeks, and McMurray is 36th in the owner standings. If he blows a right-front tire in qualifying, he heads home.

[+] EnlargeJamie McMurray
Jason Smith/Getty ImagesA few bad outings have Jamie McMuuary in an unexpected position.

And don't forget, the expectations on McMurray are fundamentally different than everyone else's. He is the first driver Roush ever went out and got. From Kurt Busch to Greg Biffle to Carl Edwards, Roush has always cultivated talent from within. McMurray was hand-picked. That's a lot of pressure.

To be fair, let's look at his 2008 performance for what it is: a boatload of bad luck.

Racing is fickle. Are results always indicative of performance? Sometimes yes. Sometimes no. Look at Jeff Gordon's year. He's had top-5 cars everywhere, and on paper he's 14th in points. That's one position worse than teammate Jimmie Johnson, and Gordon's worn Johnson out all year.

Back to McMurray. This is not an apologist excuse, so don't give me a bunch of static. I'm just giving his dismal year some context.

Daytona began with a wreck in the Budweiser Shootout while running fifth. Car killed. Then another wreck in the Gatorade Duel. Car killed. So here he is entering the Daytona 500 in his third car of Speedweeks, which essentially means it was the 12th-best car Roush had at the moment. He ran 26th.

On to Fontana. He was running in the top 10 with a handful of laps to go and lost it. Finished 22nd. At Vegas he spun down into the infield on Lap 10, knocked the header pipe off and was down on horsepower all day. Finished 25th. Atlanta: awful. Finished 40th. At Bristol, the team tells me the left-rear axle cap was left off the car. That's not McMurray's fault. He wrecked and finished last in the field.

Voila, 36th in points. To help diagnose the team's problems, Edwards accompanied McMurray and the No. 26 team at a test in Nashville this week. McMurray tells me it went very well.

At this rate, I am contemplating renaming this column to The Six.

Marty,

I'm a bit new to being a NASCAR fan, the start of this newfound obsession being last summer. One thing that I'm confused about is how the engine manufacturer/team owner relationship works.

Herein lies my confusion -- the Furniture Row Racing team is using Hendrick engines. How does that work? Do the parts go to the Hendrick shop, get assembled and sent to the Furniture Row team? If so, why don't they do it themselves? Please elaborate.

-- Jay, Denver

Jay, Denver. Seeing your question made me pull out the John Denver greatest hits album. My wife's uncles, Joe and Steve Cocozza, both attended West Virginia University. Hence, it has become semi-tradition during family shindigs to infiltrate the closest karaoke watering hole and bellow "Take Me Home, Country Roads" at pitches and decibels that make hound dogs squeal. It is premium good times.

Anyway, about the motors. I discussed your question with Jeff Andrews, Hendrick Motorsports' head engine builder, and he broke it way down for you.

First, he told me the simplest way to describe the relationship between a manufacturer and team is to look at the manufacturer as a sponsor. Chevrolet sponsors Hendrick's effort with both engine components and chassis components. They currently receive cylinder blocks, cylinder heads, intake manifolds and some assorted accessories for the engine -- such as water pumps and valve covers -- from Chevrolet as part of the sponsorship.

The cylinder head, for example, is supplied as a machined part. But once HMS receives the part, additional work is done, within the NASCAR rules, that is proprietary to a Hendrick Motorsports engine in the effort to enhance performance based on the team's research and development.

This is where smaller one-car operations get left behind. They struggle to stay on top of technology due to lack of resources. Andrews says it's not that they're not capable of assembling the engine with the components supplied by Chevrolet, it's more about the proprietary technology Hendrick passes along to them with the HMS engine.

The engines are owned by Hendrick and supplied to the Furniture Row team -- in other words, Furniture Row leases them. By doing so, they are assured that they are receiving the same engine package and the same technology level as is being used by any Hendrick Motorsports-owned car.

You may not believe that. It's hard to believe, no?

Andrews, though, explains that HMS is part of what is called the "GM Racing Key Partners Group," which means that the HMS engineering staff, along with a similar staff at Earnhardt/Childress Racing Engines, under the direction of the core group in the GM Motorsports NASCAR Engine program, are responsible for the development and design of future engine components -- all of which benefits a smaller team such as Furniture Row, because the technology is implemented directly into the engines that are installed in their cars.

"It's a win-win situation for both organizations, as we use the income from the lease program to further the development of our engines and, [Furniture Row is] ensured that the engines they are getting are built to the exact same specification as any Hendrick Motorsports car," Andrews said.

Told you he broke it down to the DNA.

Marty,

I've been watching NASCAR for several years and I believe I have a very good understanding of how most things work, but I'm still confused about one thing in particular.

We all know that the top 35 get into the race automatically after the first five races, but how is the rest of the field set when qualifying is canceled? I know there's one championship's provisional available for the most recent champion who needs it, but how is the rest of the field decided?

-- John, Lompoc

Lompoc? Is that in Nova Scotia, dude? I Googled it, and Lompoc, Calif., came up. So I'll presume you're from the Left Side, John. Per the 2008 Sprint Cup rulebook, here's the deal …

If he's not already in the show, the next available starting position outside the top 35 will be assigned to the reigning champion driver in the Sprint Cup Series. The next available starting positions will be assigned to car owners who have won at least one championship points race, with the car licensed by that owner, in the Cup Series during the current calendar year or previous calendar year, not already in the field.

After that, starting positions will be assigned to any drivers who have won at least one championship points race in the Cup Series during the current calendar year or previous calendar year not already in the field.

The next available starting positions will be assigned to any car owner who has a past champion driver, who is eligible per the entry blank, and who participated in the Cup Series as a driver in the previous calendar year. In the event of more than one champion, starting positions will be assigned in descending order, starting with the most recent champion.

The remaining starting positions, if any, will be assigned to car owners who have made the most number of qualifying attempts during the current calendar year, and after that any available starting positions will be assigned to cars in the order (1, 2, 3, and so on …) in which their number was selected during the random qualifying draw for the event.

Uhhh … what? The Pythagorean Theorem is simpler.

Hiya Marty!

Big fan of yours. A couple of things -- Davey was my all-time favorite driver as well, even though Alan in his Hooters No. 7 was not far behind. And you're right with the best paint scheme being Davey's white in front black in back and gold numbers car. THE BEST! But I have a special place for the car Jamie McMurray drove last year at Dover -- the autism car. Just very nice to see.

I have a quick question for ya. Who (or I guess what company) makes the call to have which car carry an on-board camera? Do Bud and Home Depot pay the network to have a camera on that car? Or is it by some blind draw? Keep doing what you're doing and never change.

-- TJ, Iowa. (Yeah, it's that boring)

Went to my boys at ESPN for you, TJ -- namely Andy Jeffers, the in-car sales coordinator for the network. AJ tells me companies do buy the in-car cameras for the respective car they sponsor. Teams, though, can also purchase a camera if they are trying to help gain some exposure for their sponsor.

For example, Home Depot is a great supporter of ESPN, so in their particular media buy the cameras are included as a package. ESPN/ABC also sells the in-car cameras as "one-offs," meaning an individual purchase can be made on an in-car camera system.

The in-car cameras are revenue-driven and on rare occasions are they placed in a car to help cover the story of that race.

I can't help you much on Iowa. I've only briefly been there. And the only reason I was there at all was because my producer caught a case of Valero amnesia exiting Chicagoland Speedway last year and sent us the wrong way down the highway. We drove for about 100 miles before realizing we went the wrong way.

There is one thing about Iowa that is unmistakably stellar: the John Deere tractor. Untouchable.

Hey Marty,

I've decided to email you until I see my name in your column! I think I've emailed you somewhere around eight times. Last week I emailed you about Ricky Carmichael. I'm still curious about that. If you can find out anything about how his NASCAR career is going, my husband and I would be grateful! I hope you and yours had a great Easter!

-- Chandra Papillion, Neb.

Well, Chandra, there you go. You're in The Six.

As for The GOAT, he'll run a full season for Ken Schrader Racing in the Camping World East Series.

Marty,

I know it may be a long shot, but with Dale Jarrett revealing a No. 44 UPS paint scheme for the All Star race, what happens if David Reutimann also qualifies for the All Star race through the Open? Will NASCAR allow two No. 44 UPS Toyotas on the track at the same time for the All Star race?

-- Bill, Gaylord, Mich.

That's a negative, Bill. Norris, the MWR GM, tells me Root is in the No. 00 for Charlotte, regardless what happens, and Michael McDowell will run a fourth car, the No. 32 Camry.

That's enough. This column is longer than the Coca-Cola 600 on bad tires.

Marty Smith is a contributor to ESPN's NASCAR coverage. He can be reached at ESPNsider@aol.com.