With GM, Chrysler and Ford on the financial ropes, what are the prospects for NASCAR for the next couple of years? Looks grim to me.
The bigger issue is the sponsors, lots of financial companies, insurance co's, retailers are major sponsors now, primarily because they priced the consumer products guys out. If those guys start to bail, NASCAR is in big trouble. Remember 2002 when they had to pay wannabes and washed-up drivers to fill the field? I could see that happening again in '09. The interesting question is what will Toyota do...stay and be a 1-make series? Cherry pick the top teams left without MFR contracts? Pull out of NASCAR because there's no one to beat?
NASCAR will survive but they are going to have to re-invent their show. Like the NHRA running the 1000 foot strip, NASCAR is limited by their largest tracks. In order to enliven the show they would have to do away with their restrictor plates. Then you could see some real racing. But in doing that they risk the liability of a vehicle out of control. The TV networks are seeing a drop off in ratings in many ways because the racing can be down right boring, ie, the NASCAR yellow. As Dale Earnhart said long ago about Talladega and Daytona; "We are not really racing. We are just driving around out there." Until they are able to remedy that situation they will be in an ugly viscious downward spiral.
MSN is saying that Honda has quit F1. Wouldn't be suprised if Dodge leaves NASCAR within the next year or two.
How about this for an idea.... What if they raced real "stock" cars. Do it like it was in the 60's, you welded in a cage (ok, it was just a roll bar then), put on some different wheels and tires and raced the cars. I saw an article once on Junior Johnson's Holly Farms "Mystery motor" Chevy and what amazed me was how much of the car was really stock. In those days win on Sunday and sell on Monday meant something.... First of all the speeds would be down and since you are going to equalize the cars with restrictor plates anyway, you don't need to spend a fortune in engine development... And wouldn't it be neat to actually see different cars out there as opposed to the Crap of Tomorrow.... The fans would really learn what was the best car out there, and talk about being able to relate to what was going on at the track... Chrysler, Ford and GM all have front engine rear drive pony cars that would be the basis for each racer... Not that it would ever happen, but you could build a car for somewhere around $75k, and that would sure level the playing field and bring down the cost of racing so that the teams could afford it..
I thought that they were only running 1000 feet because of Scott Kalitta's crash. Every other class other than top fuel nitro ran the full 1320 feet. IMO NASCAR just needs to end entirely. my 2c...
What makes you think Toyota wont be tight on money too?? Hope it shrinks alot. NASCAR sucks the blood/money out of good racing. TT
Spot on. The racing divisions should be shielded from the retail failings provided there are customers. NASCAR has been talking about sponsor crises for the last couple years, and I have to think 2009 is going to see a lot of them fall away.
Fair point, Toyota has cut production and car sales are down everywhere, not just the Big 3. but Toyota is better poised to stick around, the question is would they be motivated to do so.
It seems the main difference between Honda/Toyota and the Big 3 is that the Japanese are retreating pro-actively whereas the American car builders are in a huge hole already.
The problem is that US automakers have huge "fixed" costs for health care, retirement and stupid stuff like the "jobs bank" that pay people to not work. The labor costs are fixed, and even if they don't produce cars they are paying workers 95% of what they would be paying if they were. What happens is that the transplants can simply cut production, and their costs drop, no sales, no workers working, no cars being built, but no big costs other than keeping the grass cut and paying the mortgage on the building. For the Big 3, even if production stops the costs go on, and that is what's killing them. If the production plants are running full tilt, GM, Ford and Chrysler are very profitable. We can go on and on about how this was a bad contract feature, but really, nobody ever figured that gas would hit the absurd $4.50/gallon (which then whacked the large size vehicle market) and then the economic crisis hit and dried up financing, and finally the press scared everybody into believing that the sky was falling, so it was really a perfect storm, even though gas is down to $1.60 a gallon, people are too scared to buy what are really pretty nice vehicles.... The transplants weren't any more proactive than Detroit, they didn't want to compete with them in the larger vehicle market because, for the most part they couldn't make a better truck or large SUV, so they stayed where they were and the market came to them. Only Toyota came to take on Detroit in the truck market and their truck sales are off just as much as the the Big 3. The transplants were lucky more than they were prescient
Right, but it's my understanding that racing and consumer divisions operate separately and differently from one another. I'd love to hear from someone who knows more about this, but it sounded like the threat to them was the health of the racing teams and not necessarily the parent auto companies. Or I could be completely mis-informed!
That's a matter of interpretation. The Big 3, on top of their labor issues, have fallen prey to producing automobiles for the here and now. Power! Size! Gizmos! Yeah, this will last forever. There were even news reports as recent as a week ago that said GM was ramping up production of its large SUVs in the wake of falling gas prices. To say the Japanese were "lucky" because they didn't pour millions or billions chasing after trends, well that sounds smart to me. Honda has been building Accords and Civics for how long, and always as a model of quality. Their mini-vans are also first rate and retain nearly twice their value compared to Chevy, Ford & Chrysler. Not to turn this into a Business/Politics thread, but one of the problems with the Big 3 as well is the mindset of its workforce. The Japanese have a much different work ethic and sense of pride than Americans do. We're really good when it comes to patriotism and the good 'ol USA stuff, but the reality is it's all about "gimme' mine, screw the man", in this country. But you don't dare trudge that out in the open because it's downright unpatriotic to criticize our workers. But when the CEOs first went to DC, remember that one of the first news bits we got from labor was that they wouldn't give any concessions. There wasn't even a plan laid out, and yet they just said they weren't giving anything away. But to the point, the Japanese companies have followed a smarter business model than the Americans, and they're showing that again by pulling back their spending on non-essentials like racing ahead of time rather than waiting until they're up s**ts creek.
Giles27, I think that if the Japanese could have competed with Detroit in the larger truck markets they would have, and as noted, Toyota did try to. Problem is their market research told them that they probably couldn't, so they didn't go there. The buyer of a Honda is looking for a smaller more crisp package, and that is the kind of car the folks reading this board are probably more inclined to buy. It's a different driving experience and that's what we like. While a Suburban isn't my kind of daily driver, lots of folks wanted a vehicle that big, and with a guarantee that gas prices would stay where they are now for 4 years, they would be buying one in a heartbeat. But with last year fresh in their minds, they aren't going to buy a big vehicle that burns a lot of gas. While it's easy to have 20/20 hindsight, remember that the development of a new model takes at least 3 years, and a new platform takes more like 4 to 5. Look back 5 years ago and with gas prices then, about what it is now, would you be willing to gamble a few billion dollars that gas was going to be $4.50 a gallon about the time your new product hit the market? Sorry, but nobody saw the energy price spike coming on this quickly. If they did, then they made billions in gasoline futures. I am confident that Detroit felt that, as each model came up for renewal, they could bring down the size and fuel consumption and keep them in line with market demands, while at the same time retaining their customer base. Problem for them is that the market changed abruptly and they didn't have an alternative. Also remember that with gas where it is now nobody is going to buy any hybrids or electric cars either. There simply isn't a payoff with fuel this cheap.
If you wish to believe that Detroit's problem are all the fault of the UAW, go ahead and keep drinking that kool aid. The simple truth is that every contract, including a union agreement, requires two parties. Point is that management signed off on every one of those "huge 'fixed' costs." Can you really blame the UAW for taking the gifts that management laid on the table? Plus, your crack about "transplants" is so far off base that it is not funny. Just to give one example, when Toyota cuts production, all line employees keep their jobs. Toyota puts them to work on quality circles. And, as is currently the case in San Antonio, Toyota also sends workers out into the community to do public service at hospitals and parks. If pay cuts become necessary, management takes the first haircut. There's more, but I doubt that you'll care to listen. I'll just say this: During the 80s, Toyota did everything it could to teach the "Toyota Way" to GM and Ford. Sadly, the Board of Directors of both companies refused to listen. GM, Ford, and Chrysler must die. There is no hope. Dale
