Michael Jordan and Denny Hamlin Stand Alone as Team Owners Warm-Up to NASCAR’s New Deal

NASCAR teams are divided over the idea of making charters permanent. Previously, it was reported that many teams, including HMS, JGR, and 23XI Racing, were in favor of permanent charters. Recent updates indicate that some teams might sign off on NASCAR’s proposal in the next few months, provided they get more solid guarantees about the charters.

Now, it looks like we know at least one team that’s on board with NASCAR’s plan. The team’s owner has publicly backed NASCAR’s approach. Well, that might not be good news for Denny Hamlin and Michael Jordan‘s future plans.

Has NASCAR managed to get a team on board with their charter agreement? 

The goal for the teams was to present a united front in a sport where the sanctioning body, track owners, the squad, and drivers all believe they deserve a fair slice of the revenue pie. Denny Hamlin earlier had indicated the falling apart of the teams’ unity saying, “Every team does want a little different things here and there. … This is such an important thing — we’ve had 11 teams go out of business since 2016. That’s not good..” And it looks like NASCAR might have just pulled off the first string of a classic divide-and-conquer strategy.

Justin Marks, the owner of Trackhouse Racing, hinted in a chat on SiriusXM NASCAR that they’re leaning towards accepting NASCAR’s proposal. He mentioned, “It has to be… more cost-effective to run this business. I think NASCAR understands that. We’re having conversations around what costs look like in the new charter agreement that we’re all working on. So I would look at that and I know some of those conversations that we’re having with NASCAR. that out of respect to everybody should stay there. […] negotiations with NASCAR on this charter renewal, and it’s not just about the money, it’s about kind of… You look at everything in the relationship between teams and NASCAR.”

While he didn’t spell it out directly, he hinted that because NASCAR is actively engaging with teams on governance, team rights, technology, and rule changes, and openly addressing their concerns, the new agreement is likely going to benefit the teams significantly. He mentioned that NASCAR has been quite receptive to the teams’ business models and has laid out a framework to tackle these issues.

And that’s why, for now, it looks like it’s just Denny Hamlin and Michael Jordan’s 23XI Racing on board with the permanent charter demands. But why might Trackhouse Racing be leaning towards siding with NASCAR instead of aligning with other teams?

Teams are finding it hard to stay on the same page due to differing needs

Several teams, including Stewart-Haas Racing, interested in selling their charters are already in talks with potential buyers, betting on the deal to go through. On the flip side, several teams are looking to expand and need more charters to do so. These include Trackhouse Racing, Legacy Motor Club, 23XI Racing, and possibly Front Row Motorsports. Front Row might also need more space if it expands. And, having the charters permanent might not be as valuable for them.

Trackhouse Racing, in particular, might have actually been feeling the squeeze. With four drivers under contract but only two Cup charters, they’ve had to loan Zane Smith to Spire Motorsports this year, and Shane van Gisbergen is splitting his time between a full Xfinity Series and a partial Cup schedule with Kaulig Racing.

Even with the Next Gen cars, there’s still a big gap in how teams operate, especially when it comes to their budgets. For smaller teams with tighter budgets, probably the new charter deal looks like it could help them nearly break even—currently, a large majority of Cup teams operate at a loss. So, making charters permanent might definitely be a big deal for them, since they would have to maintain them the same way. That’s why if the new deal pans out, these teams might be more inclined to sign on soon, even without the guarantee of permanent charters.

By siding with NASCAR, Trackhouse Racing is most likely looking to shield itself from financial pitfalls, ensuring its sustainability in the sport.