There are no shortcuts to success. Smaller NASCAR teams that form technical alliances to get access to better resources may disagree. In a world of instant gratification, it’s not surprising to see teams, that have no means to build their cars, or engines and hire certain staff members, pay for assistance to get instant results on the race track. Remember, Stewart-Haas Racing winning a championship in the early 2010s? It’s because they were in an alliance with Hendrick Motorsports.

That brings us to the all-important question. With 23XI Racing currently in a technical alliance with Joe Gibbs Racing, while the two teams will compete against each other in the playoffs, is the deal beneficial for all?

Why technical alliances can be a double-edged sword

With Tyler Reddick already in the playoffs and Bubba Wallace close to the playoff cutline, 23XI Racing has a lot to look forward to. If both the drivers do make it to the playoffs, they will compete against at least three Joe Gibbs Racing drivers Denny Hamlin, Martin Truex Jr, and Christopher Bell. The competition will be an interesting one, especially, considering the technical alliance between the two teams. Unlike Legacy Motor Club, which has in-house race operations, 23XI Racing relies on Joe Gibbs Racing, which has been a major factor in its success.

However, former NASCAR driver Landon Cassill had some strong views against ‘technical alliances’. As discussed on Eric Estepp’s YouTube channel, Cassill wrote on X, “Technical alliance isn’t just the cost of doing business it’s platform risk. At any moment the technical host can double-triple prices or pull the rug out from their technical partners (ask Barney Visser). This would cripple 23XI’s performance overnight and cost Denny Hamlin and Michael Jordan millions.”

He went on to say, “Any industry leader sees this kind of platform risk as a major flaw in the business model. No amount of NASCAR subsidy will change this host-partner arrangement. I don’t have the solution to this and it may not be on anyone else’s priority list but in my mind, the tens of millions exchanged among teams for support is wasted money. The money could be spent on revenue-generating assets for Corporate Partners who are footing the bill.”

For every success story like Stewart-Haas Racing in 2011, there is Furniture Row Racing as well. Barney Visser’s team had the world at its feet in 2017, having surprised everybody by winning the Cup Series championship. It had only been a year since the team secured a technical alliance with Joe Gibbs Racing, which helped build the team’s chassis and provide pit crew support.

As expected, the team succeeded on track, with Martin Truex Jr winning eight races to secure the Championship. However, things took a turn for the worst from that point on, with sponsor 5-hour Energy pulling out, while Joe Gibbs Racing increased the technical alliance fee from between $3-4 million to $10-12 million per year. The timing of the sponsorship pull-out had huge repercussions for Furniture Row Racing, who had to replace the $10 million loss immediately. When a sponsor couldn’t be found, the team ran out of options, eventually forcing them to shut down their operations a few years later.

As things stand, 23XI Racing’s technical alliance with Joe Gibbs Racing has been more beneficial for them. With just one race win for Tyler Reddick all season, it’s clear that the 23XI Racing team isn’t outperforming their technical alliance partners on track. If the past is any indication, if smaller teams outperform bigger teams, the price of the technical alliance increases drastically. If Denny Hamlin and Michael Jordan are looking for a sustainable future for 23XI Racing, they must pray that the on-track ‘improvement’ doesn’t come at the expense of Joe Gibbs Racing.

How are the other technical alliances fairing in NASCAR?

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As things stand, there are 7 other technical alliances in the NASCAR Cup Series. RFK Racing has been in a partnership with Rick Ware Racing since 2023, and both teams have shown varying levels of improvement this season. The alliance between the two teams was a major factor in Justin Haley signing for Rick Ware Racing, while Brad Keselowski, co-owner of RFK Racing, will be competing in the playoffs after winning a race this season.

One of the most complicated technical alliances in NASCAR is between Trackhouse Racing and Spire Motorsports. As per the terms of the alliance, Zane Smith, who signed for Trackhouse, was loaned to Spire Motorsports for the 2024 season. As things stand, he’s expected to go back to Trackhouse Racing in 2025, but has also been linked to a seat at Front Row Motorsports, if NASCAR limits teams to just three charters.

Hendrick Motorsports signed a technical alliance with Spire Motorsports in 2023, which allowed Corey LaJoie to fill in for Chase Elliott at Gateway. The alliance has helped Spire Motorsports tremendously, and the team has expanded to three cars for the 2024 season. As the team continues to grow, it will be interesting to see how the technical alliance between them evolves. Would Spire Motorsports prioritize their alliance with Hendrick Motorsports, or focus on their existing partnership with Trackhouse Racing? Time will tell.

What are your thoughts about technical alliances in NASCAR? Let us know in the comments!