Post by : Meena Ariff

Three-time Daytona 500 champion Denny Hamlin raised alarms regarding the financial challenges confronting NASCAR teams during a federal antitrust trial involving the racing series. As co-owner of 23XI Racing alongside Michael Jordan, Hamlin disclosed that his team incurred upwards of $700,000 in NASCAR fees in 2022, condemning the series' charter proposal as a possible “death certificate” for his organization.

During his three-hour testimony, Hamlin outlined his team’s financial commitments, encompassing entry fees, track access, team credentials, and internet services. He emphasized that building 23XI necessitated a $100 million investment and warned that losing a single sponsor could eliminate profits.

The lawsuit initiated by 23XI Racing in conjunction with Front Row Motorsports contends that NASCAR functions as a monopoly, enforcing a revenue structure that renders profitability nearly unattainable. Hamlin referenced a NASCAR-sponsored study indicating that 75% of teams lost money in 2024. He also critiqued recent television contracts, asserting they benefited sponsors who prefer traditional TV over streaming.

Hamlin discussed exchanges with NASCAR officials, including chairman Jim France, who advised teams to limit expenditures to $10 million per car, which is significantly less than the $20 million Hamlin claims is necessary for a complete season. When critical issues remained unaddressed in the latest charter agreement, 23XI opted not to sign.

“I refrained from signing because it felt like a death certificate for the future,” Hamlin stated. “23XI is making its contributions. One cannot be treated so unfairly, and I felt it was unjust. They were in the wrong, and accountability was essential.”

During cross-examination, Hamlin conceded that his public endorsements of NASCAR are often scripted to evade backlash, including stricter inspections or potential penalties.

The trial also highlighted that NASCAR generated over $100 million in 2024, valuing the series at $5 billion, based on a 2023 financial assessment. NASCAR asserts it has not restricted trade, claiming that chartered teams now obtain guaranteed revenues of $12.5 million annually—significantly lower than the $20 million Hamlin suggests is required to operate a single vehicle.

Testimony from 23XI underscores the escalating friction between NASCAR's conventional business model and the economic realities faced by contemporary racing teams, potentially altering the landscape of stock car racing.

#Canada News #World News #Denny Hamlin