Since the beginning of 2024, race teams have clamored for a few demands. They include making charters permanent, an increased share of revenue in business deals, and having a voice in decisions. However, the first item on this list assumed priority, especially because D-Day is fast approaching. If NASCAR does not reach a favorable agreement by the end of 2024, dark times lie ahead for many teams, including what will be Tony Stewart’s former camp.

As Stewart-Haas Racing, the stellar Cup Series team, is set to shutter its 16-year-old legacy soon, Gene Haas and Tony Stewart looked to gather a few scraps of profit from their crumbling enterprise. But even that is at risk if NASCAR does not come up with an agreement soon.

Tony Stewart and Haas may lose their profit

Executives introduced the NASCAR charter system in 2016, intended to allow more financial flexibility for teams. But on the contrary, race teams faced new economic sinkholes to slip into. Ranging from expensive Next Gen Cup car parts to soaring race entry fees, team owners were in a soup. So since 2016, 11 teams have “closed, merged, or gone bankrupt,” as 23XI Racing co-owner Michael Jordan said.

The increasingly tighter financial situation led a NASCAR executive to admit drivers’ dwindling value: “Unless you’re Jeff Bezos, it’s never as much as you think.” So Tony Stewart and Gene Haas may not be able to bid adieu to their beloved Cup team in peace. They sold an SHR charter to Front Row Motorsports for around $25 million. But if the charter agreement does not renew, that throws up a question that Kenny Wallace asked.

Hosting Denny Hamlin on the July 13 episode of the Kenny Conversation, Wallace asked, “We just watched some teams pay Gene Haas $25 million. What would happen if, at the end of this year, NASCAR said charters don’t exist? Does NASCAR have a responsibility? How could that just all go into thin air?” He significantly added NASCAR’s basic sense here: “It’s kindergarten stuff.”

Denny Hamlin pointed out how this is exactly what the Cup teams and the Race Team Alliance are fighting against. However, given Jim France’s traditionalist mindset and the fact that he doesn’t stray too far from his family’s legacy, improving Tony Stewart’s situation seems unlikely. Hamlin replied, “I know, I hear you. But the sport is run differently and it’s unfortunately run by someone who says, ‘This is what’s worked for 75 years, and I’m not changing.’”

Then, Denny Hamlin further stated that Tony Stewart’s charter deal was at risk. His agreement with FRM owner Bob Jenkins may be null and void if the charter deal is not renewed. “More than likely, Bob Jenkins put provisions in there that says, ‘Okay, this deal will go through as long as there are charters.’ Attorneys would never put that at risk, I would think. You can’t sell something that doesn’t exist. So, I think Gene Haas wants to see this charter deal done.”

If NASCAR does implement what is sure to be a grim reality – that charters won’t exist anymore – Front Row Motorsports will undoubtedly ask for the $25 million or so that Haas and Stewart earned to be returned. And the co-owners would have no option but to oblige. So, as D-Day approaches, it won’t just be Haas and Stewart on the edge of their seats. It’ll be every team that owns a charter because, according to Hamlin, the situation “keeps getting worse.”

What brings fans to races every single weekend? It’s the drivers and the teams, and the love fans have for them. Imagine a situation where there is no charter deal. The 23XI co-owner mentioned spending around $18 million a year to put a car on the racetrack. So, if there was no charter deal and teams weren’t paid to enter races, they would just choose the highest-paying ones and participate only in them. And where would that lead NASCAR?

The organization would crumble. That’s what will happen. However, NASCAR management isn’t understanding that. Venting his frustration, Denny Hamlin told Wallace, “We’re banging our heads up against the wall because, repeatedly, as these negotiations have gone on, there’s been no negotiation. Every proposal they send back to us is worse than the previous. That is factual; it keeps getting worse. We are worse off than we were 2 years ago, and we are 8 months away from the Daytona 500 and there not being any charters.”

In line with Denny Hamlin’s concerns, a 23XI Racing official also chimed in along similar lines.

Like tenants in a building?

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If NASCAR does not reach a favorable agreement soon, SHR will not be the only team set to lose money. Spire Motorsports bought a charter for a whopping $40 million a few months ago. So this massive investment might turn worthless unless NASCAR yields to the drummed-up demand for permanent charters. Curtis Polk, Jordan’s longtime financial and business manager and a part owner of 23XI, shed some light on this pressing matter.

Polk drew a rather apt comparison, highlighting the helplessness of race teams. “We’re basically tenants in an apartment building. We have these charters, and they give us certain rights, and we have responsibilities because of the rights they give us. But at a date certain — which right now is Dec. 31, 2024 — we have no further rights to renew, and [the charters] could be taken away from us.”

Michael Jordan himself said what impact the charter deal could have on the sport as a whole. He said that denying permanent charters is a mistake. “That’s a big, big miss right there. If you don’t correct that, this sport’s going to die not because of the competition aspect, but because economically it doesn’t make sense for any businesspeople.”

Hence, all eyes are on NASCAR executives to ameliorate the charter situation. Because time is running out fast, race teams are at risk.