George family feud may affect IndyCar
Tony George, the man who for better or worse holds all the cards in Indy car racing, finds himself and his Indy Racing League at a crossroads.
A family dispute over who's in charge and how to run things could put the IRL in jeopardy.
George's control over the Indianapolis Motor Speedway, his power base and money stream, could end.
If so, his detractors will say George finally got his comeuppance. They see him as the man who caused a 12-year Indy car feud that led to two separate leagues until last year's unification.
Others disagree, saying George did what needed to be done at the time to return Indy car racing to its roots.
Whichever side you fall on, one thing is certain: This family power struggle is a dangerous situation for the IndyCar Series, the IRL's top level.
Contrary to a published report Wednesday, George wasn't voted out as CEO of the Indianapolis Motor Speedway.
But as one speedway official told me, "It's fair to say a change is coming. We just don't know what that is exactly."
The IMS board of directors met Tuesday to discuss a possible realignment of power within the family. Mari Hulman George, Tony's mother, is the chairman. Joining Tony on the board are his three sisters, Kathy, Nancy and Josie. Family attorney Jack Synder is the sixth board member.
Sources say the likely scenario is for Mari to retire and Tony to become the chairman later this year. It sounds good and saves face, but his control over the speedway would end.
On May 2, the Indianapolis Business Journal quoted George as saying the IRL needed to make a profit by 2013 to stay in business. George said last week the quote was taken out of context.
With the latest development, four more seasons might be stretching it if the league shows no signs of increased revenue.
A title sponsor, which could bring in $10 million a year, would help. But that alone isn't enough.
One IRL team owner said it's all a family disagreement.
"I love Tony," he said. "But I also love the entire family. I care about all of them, and I don't want to get in the middle of it."
The sisters want Tony to take his toy (the IRL) and do whatever he wants with it, but leave the speedway out of it.
Therein lies the problem. The IRL never has made money. Not even close.
At times over the years, Tony's siblings didn't like it, but they begrudgingly supported their brother. That support is ending. They don't want the family fortune squandered on a racing league that isn't financially viable.
Seems reasonable, but is it? The cash cow for IMS is the Indy 500. If the IRL fails, can the 500 succeed with no series to promote it?
And will all this force the family to consider selling the speedway? What is it worth?
The old Brickyard, which seats 257,000 people, isn't going to fade into a dusty relic. One Speedway Motorsports Inc. official said, "The bidding would start at $1.5 billion."
The players at that level are few. Even International Speedway Corp., which is controlled by NASCAR's France family, wouldn't likely make that financial commitment in this economy.
The cash cow for IMS is the Indy 500. If the IRL fails, can the 500 succeed with no series to promote it? And will all this force the family to consider selling the speedway? What is it worth?
The hard numbers are difficult to attain, but conservative estimates have IMS earning between $80 million and $100 million a year in profit off the Indy 500 and the Allstate 400 NASCAR race.
Sources say the MotoGP motorcycle event, which made its IMS debut last year, makes a marginal profit, but it's insignificant. And it doesn't make up for the millions IMS lost on the Formula One race it lost in 2008.
Since the start of the IRL in 1996, George has used profits from the speedway to keep the league afloat. He backed teams and drivers during the long feud with CART/Champ Car, a bitter split that severely damaged the popularity of open-wheel racing in the United States.
Reports on expenditures vary widely, but George probably spent as much as $500 million over the last decade to prop up the IRL. Some of that money also was spent on renovations at IMS to bring the F1 race to the Brickyard.
The hallelujah moment came last year when the Champ Car World Series folded and the leagues united. The healing process had begun. The IRL also has some rising stars to market in Marco Andretti and Graham Rahal.
The biggest asset is Danica Patrick. But will she stay if NASCAR comes calling with a pot of cash? The league's hope for financial stability could rest on her decision.
For the moment, things look bright. Helio Castroneves earned a storybook victory last weekend in the Indy 500, five weeks after acquittal on tax-evasion charges.
All roads point toward better days ahead. Maybe that's why George's sisters decided to take a stand.
Tony finally had what he wanted all along -- one series on the upswing with marketable drivers. From the sisters' point of view, it was the right time to ask their brother to go it alone, so to speak, with the IRL.
Revenues for all the family assets, including the Clabber Girl Baking Powder company, are down in a struggling economy. Propping up the IRL may no longer be an option.
If things don't improve, George could try to sell the IRL, but who would buy it? Roger Penske, maybe? And what would it take to make it work?
"Leadership all around," said one track promoter who didn't want to be identified. "Professionals -- full-time, proven sales people and marketing people. True PR pros; broadcasting experts; and most of all, a single, solitary leader.
"These people have to come from auto racing or pro sports at least -- big-name people that you would recognize. Right now they are all amateurs."
The IRL could resort to racing on an event-by-event basis, depending on which promoters are willing to pay enough up front to make money for the competitors.
It seems to work in F1, but that series has enormous international TV revenue, something the IRL doesn't have. And this mercenary theme doomed Champ Car, which lost more than $90 million in 2007 before folding.
Some track promoters feel the IRL hasn't done enough to support other races because George felt it would detract from the Indy 500. If so, it's flawed logic. One great event can't keep a league viable.
So this is make-or-break time for the IRL. And it's up to Tony George, the man who always believed it was the right thing to do.
Now he has to prove it.
Terry Blount covers motorsports for ESPN.com. His book, "The Blount Report: NASCAR's Most Overrated and Underrated Drivers, Cars, Teams, and Tracks," was published by Triumph Books and is available in bookstores. Click here to order a copy. Blount can be reached at email@example.com.
MORE RACING HEADLINES
- $5.8M settlement in Calif. off-road crash
- Kahne, Stewart will honor Leffler at Chili Bowl
- McNish, 3-time winner at Le Mans, retires
- Ganassi hires veteran Briscoe to drive 4th car