Is NASCAR biased towards certain teams? That’s a natural question some Cup team owners have after learning that the stock car organization may limit the number of charter teams per team to three. Owners were already feeling anxious following news that teams like two-time Cup champion Stewart-Haas Racing would be leaving early at the end of the 2024 season, and this latest revelation may give them sleepless nights.
The new charter agreement could see Joe Gibbs Racing and HMS maintain the four-charter system under a grandfather clause. In response, Denny Hamlin, NASCAR’s most vocal critic, couldn’t help but analyze what this means for newcomers like 23XI Racing. And the odds are definitely not in his favor.
According to The Athletic’s Jordan Bianchi, the proposed new charter agreement would limit the number of teams chartered to three, which could prevent other teams from advancing. NASCAR is known for its emphasis on teamwork.
Running a full-time Cup Series project is very expensive, from hiring qualified engineers to putting together the ideal pit crew. Still, horse racing is run much like any other business: the more you invest, the higher your chances of success.
This idea is especially true for teams like HMS and JGR. With four charters and some of the biggest names in American motorsports, the two teams have arguably had the most powerful rivalry in the Cup Series to date. And it’s showing this season, with the duo taking victory lane 13 times in the last 16 point races, the most race wins ever. The ultimate goal for new teams like 23XI Racing, Trackhouse Racing and Spire Motorsports is to compete with JGR and HMS, but Denny Hamlin thinks that dream might be out of reach because of the three-charter limit.
The 23XI team owner elaborated, pointing out a troubling imbalance that will haunt him in Actions Detrimental. “So if you limit that number to three and say, ’23XI, that’s all you can do, you can only have three for the rest of your life,’ I’d say, ‘Okay, so how can I be Joe Gibbs? Beat Hendrick? I’ll have more resources. I don’t know if I necessarily agree with that.” Moreover, he also shared the downside of the charter limit, without directly pointing the finger at NASCAR’s top executives. “I think this is part of a bigger plan by Jim France and what he wants.
The problem is, we already have four teams. So, if we limit it to three in the future, it’s always beneficial to have four. How many four-car teams will be left with Stewart-Haas gone?'” Hamlin revealed. Currently, only HMS, JGR, and the soon-to-be-defunct SHR have four full-time positions. With Tony Stewart’s brainchild soon to be eliminated, Hamlin seems to be pointing out the unfair advantage enjoyed by billionaire racing moguls Rick Hendrick and Joe Gibbs.
The question that arises is how smaller teams with limited budgets such as Spire Motorsports (three full-time slots), JTG Daugherty Racing (one full-time slot), and Kaulig Racing (one full-time slot) will fare compared to the other big names. According to Hamlin, if the rumors about NASCAR’s limit are true, this would create a huge conflict for smaller teams who could never hope to have four charters. He explained: “Aren’t these (HMS and JGR) the two most likely teams? So how can the smaller teams that are less likely to win have the same chance? Right now, the teams that will be most affected by this charter limit will be teams like Trackhouse and Spire.” The fact that Trackhouse has four full-time Cup driver candidates could create problems for them.
There are also reports that NASCAR has made a proposal in its latest charter agreement to offer teams a seven-year charter contract instead of a permanent one. Negotiations over a new charter agreement have stalled with the current contract expiring at the end of the season. Cup teams reportedly want an additional share of media revenues from a $1.1 billion annual media rights deal that runs from 2025 to 2031. But current Chairman Jim France, whose family owns the organization, seems reluctant. Even Michael Jordan, who owns 23XI with Hamlin, raised the issue of a lower revenue share earlier this year.
Jordan said, “In all partnerships, if you grow the pie, that means your business is going to continue to grow. And to grow the pie, you’ve got to make sure everybody’s healthy within the partnership. If our ownership in NASCAR is losing money and NASCAR’s the only one making money, that’s not a good partnership.” Clearly, the latest update around limiting charters is further bad news for the likes of 23XI, who have the chances to expand their team and generate more revenue.
Ultimately, this also makes Denny Hamlin believe smaller teams cannot keep up with the four-charter teams in the long run because of the difference in resources and manpower.
