Crash Course in Race Economics

June 30, July 27, Oct. 19 and Nov. 9 are circled on Jeff Burton’s calendar. They are the quiet Sundays he can spend in Huntersville, N.C., with wife Kim and daughter Paige, or maybe drive up to South Boston, Va., for a reunion with his brother Ward and the folks.

June 30, July 27, Oct. 19 and Nov. 9 are Sundays that wouldn’t be so quiet if it were up to Bruton Smith, Roger Penske, Chris Pook or anybody else with a racetrack and an idea that those are dates Burton could be behind the wheel of his Ford, racing for dollars.

His . . . and theirs.

How many dollars?

Well, Burton picked up $354,350 for winning the inaugural race at Texas Motor Speedway, which is owned by Smith’s Speedway Motorsports Inc.

Smith doubtless picked up more than $8.1 million, after the bills were paid.

That figure is the average margin--including profit and money to retire debt for construction costs--from a major Winston Cup race, according to Montgomery Securities, a San Francisco investment firm that is helping introduce motor racing to Wall Street. The marriage is a sign of the bottom-line times, and everybody wants a piece of the action.

In NASCAR, it’s Bill France’s action.

He carries the title of president of the organization, and he’s the head of the France family that founded and continues to own NASCAR 49 years later. He’s also the chief executive officer of International Speedway Corp., which owns tracks at Daytona, Talladega, Darlington and Watkins Glen.

Outside International Speedway Corp., the France family has also quietly owned 50% of the Martinsville Speedway in Virginia for almost 50 years, which helps track President Clay Campbell sleep better at night, confident that the association will keep the wolves away.

To further complicate matters, International Speedway Corp. also owns 12% of Penske Motorsports, which owns the track at Michigan and, on Sunday, opens for Winston Cup business at California Speedway in Fontana.

All of this matters because France also controls NASCAR’s schedule of Winston Cup dates, and this year there are 34 of them, including the non-points events--the Winston, an all-star race at Charlotte and the Busch Clash at Daytona.

The old standbys on the schedule--Daytona, Darlington, Talladega, Charlotte, Atlanta, Rockingham, Richmond, Martinsville, Pocono, Bristol and Michigan--have two dates each. So does Loudon, N.H., a special case and an indicator of the possible future of NASCAR racing because of how the track got them.

Penske’s California Speedway and Smith’s Texas Motor Speedway have one date each.

Each wants another.

And Pook, head of the Grand Prix Assn. of Long Beach, which recently opened the Gateway track near St. Louis, has none.

“Right now, we feel like we have to prove ourselves,” he says. “We’d like a Winston Cup date, sure, but we feel we have to prove that we can run a Busch Grand National race before they’ll let us have one. That race, the last of July, is very significant for us.”

Smith, who also owns tracks at Charlotte, Atlanta and Bristol, isn’t as shy about the whole thing. He expects he and Penske will have two dates a year for their new tracks very soon.

France is the man in the middle, and he is coy when asked about expanding the schedule.

“We are limited by the calendar, and there are only 52 weeks,” he says, while extolling the value to tracks of the Busch Grand National and Craftsman Truck series as alternatives.

But Bo Cheadle of Montgomery Securities is having none of it. He values a Grand National or truck race at about $500,000, several laps from Winston Cup’s $8.1 million and even from the $3 million of a CART race.

“The Winston Cup is prime and Busch Grand National is triple-A grade,” he says. “There’s room for the [Winston Cup] schedule to expand, and I personally believe that NASCAR could expand their schedule by having drivers drive in just one series. In my opinion, Winston Cup drivers should drive Winston Cup, allowing others to drive Busch Grand National. What they have now is excess capacity.”

What they have now is a split of opinion among the drivers.

“The schedule is big enough,” Burton says. “We’re away from our families enough now as it is.”

Added Jeff Gordon: “There’s no room for more races, not in one series. But there’s room for improvement in the facilities, which are going to draw more fans.”

And Dave Marcis: “Thirty-seven or 38 dates? I just don’t know how the hell the small guys are going to run all that.”

But, others acknowledge that there is flexibility, or what Cheadle calls, “slack in the system.”

“Our guys work every day, 52 weeks a year,” Geoff Bodine says. “If you’d let them, they’d work Thanksgiving and Christmas. And we want to race. That’s how you can make money.”

And from Terry Labonte: “Well, I think that it really doesn’t matter to me. You’re talking to someone who runs 18 Busch races anyway. But I think . . . the one that’s going to be the loser is the car owner, because it costs a lot of money to run every race. So you add, say, two more races, these owners have got deals with their sponsors that are already set for the next two or three years. Two races, that’s a pretty big increase in your expenses.”

There’s little difference in opinion among the track owners. They have sunk big dollars into new facilities spawned by a racing boom that has turned a sport once controlled by a few eccentric gearheads often called “good old boys” into a multibillion-dollar business that goes to Wall Street for capital.

Penske has $100 million in California Speedway and Smith about $150 million in the Texas track. Dover Downs has plans to expand to 180,000 seats around the one-mile track, and Bristol will be at 131,000 around a half-mile track very soon.

Campbell says Martinsville is slowly working toward 100,000.

There are about 3.4 million seats available for Winston Cup races, and nearly all of them are filled.

Pook built his new Gateway track for $26 million, but put in only 25,000 permanent seats and 25,000 temporary ones and claims a Winston Cup date was not in the financial planning, though one would make things easier. And would call for more seats.

Cheadle estimates construction costs in the neighborhood of $350-$400 per seat, once expansion plans have played out, and with a $95 top ticket at California Speedway, the arithmetic shows that the payoff can be huge.

And debt seems to be no problem. About three miles away, Ontario Motor Speedway is a memory, its message sign serving a shopping mall built on the old grounds that were hastened into racing history by mountainous debt.

“If it was now, the debt wouldn’t have been a problem and we probably wouldn’t be standing here right now,” says Les Richter, general manager of Penske’s California Speedway.

Expanding the schedule is an answer, though not the only one, and drivers expect it, though France was quoted as saying that the 32 points races and two non-points events were about the limit when the Texas track opened.

“I hear 38 races,” Jeff Burton says. “I hope not.”

It could be accomplished by trimming back on practice dates. Each NASCAR team has eight a year, and they are used to test new facilities--eight teams showed up in May to tour California Speedway--and new cars.

“They could cut back testing easily enough,” says Ned Jarrett, a television broadcaster and father of driver Dale Jarrett. Ned Jarrett also won the Winston Cup points title, in 1965.

“I drove in 55 races that year,” he says. “But you have to remember that most of them were 100-milers, where we’d come in, practice, qualify and race all in the same day.”

Cheadle has another idea.

“There could be two conferences, like an American and National league and then a championship,” he says.

Drivers to a man recoil at that thought.

“They come to see us,” Rusty Wallace says. “That wouldn’t work.”

A final option is the most distasteful, and Loudon is its model.

The New Hampshire track bought 50% of the North Wilkesboro Speedway. A five-eighths-mile facility in North Carolina, the track ran NASCAR races from 1961 until this year. It lies dormant now, one of its racing dates spirited away to New Hampshire, the other to Texas.

Smith had bought the other 50% and, more important, a racing date.

Campbell defends the move, even while he defends Martinsville from a similar fate.

“You have to remember, NASCAR didn’t leave North Wilkesboro, North Wilkesboro left NASCAR,” he says in something of a semantic game that the folks at North Wilkesboro do not understand. All they know is that they packed an ever-increasing number of seats for 35 years, and now the seats lie unpacked, the track dark.

The next target would appear to be Rockingham, a one-mile facility in North Carolina that has only 45,000 seats but sells them all for its two Winston Cup dates. Montgomery Securities calls races at tracks such as Rockingham and Richmond “minor W.C. events,” which generate about $2 million profit, rather than the majors’ $8.1 million.

Penske Motorsports has bought more than 70% of the facility and it has a curious partner-competitor in Smith’s Speedway Motorsports, which has 24% and wants more.

Penske paid a bit over $19 a share for its portion, and Smith is willing to pay about $32 a share for the lot.

“I’ve told Roger this is my part of the country, and it’s a long way from home for him,” says Smith, laughing, but probably on the square because a court fight is said to be a possibility.

The people at Rockingham embrace Penske, because he has said his company “has no current plans to move any of these dates.” They also know that Smith has Charlotte Motor Speedway nearby and figures that is enough to serve the market.

A date moved to Texas would be a real possibility, and it would make Campbell more nervous in Martinsville if he didn’t have France for a partner. And Campbell acknowledges that it worries other independents at Richmond, Pocono and Phoenix.

“We have a lot of people coming in who don’t understand people like us, who don’t understand tradition,” he says. “Money is what drives these people, greed for money. A lot of them have no sense of the past. They don’t know anything about the past.”

Indeed, the past is only prologue to people such as Cheadle and even Smith, whose Charlotte and Atlanta tracks were once bankrupt, but were righted financially and helped spawn the boom.

“Something has to change,” Cheadle says. “They can’t just stay with 32 or 34 dates. A real indicator is that the major facilities sell all their seats, and the tickets are at full price at places like Bristol, Atlanta, Fontana and such. . . .

“I think NASCAR is very openly telling small-track operators that the time is now, if you want to sell your track and its dates. They are giving operators a window of opportunity that may never pass this way again. Right now, if you want to see some real value.

“The ‘good old boys era’ is going away. The people at Pocono, Rockingham, we want those dates moved to those who deserved them.

“It may be two years, it may be three years, but right now they are the most valuable. The 25 biggest [markets] must be served. Go find a buyer for your facility.”

Campbell sighs and says, “We’ve been in this for 50 years, and I’m personally not interested in selling.”

And the drivers and team owners watch and wait, weighing tradition against the pocketbook. “I personally hated to see North Wilkesboro go away,” says Marcis, whose racing operation is about an hour from the track.

“But in some of the additional events, such as the Texas race, I won a lot of money there. I finished 15th and won $67,000. That was fantastic. That’s what we need. It’s worth the extra distance.”