NASCAR is in a stalemate with Michael Jordan and how it ends could potentially get very messy for both sides.
After more than two years of contentious negotiations over a new revenue agreement, NASCAR last weekend finally got 13 organizations — all but two — to sign a new deal.
The agreement was reached less than 48 hours before NASCAR’s playoff opener at Atlanta Motor Speedway, and multiple teams told The Associated Press they felt pressured to take what was presented as a “take it or leave it final offer” with the clock ticking on a deadline to sign.
This may not be the win NASCAR would like it to be.
Who did not sign the agreement?
Jordan and the 23XI Racing team he co-owns refused to sign the deal Friday night. Front Row Motorsports, a much smaller organization, surprisingly took the same stance as high-powered 23XI.
23XI and Front Row are the only two current chartered organizations that did not sign extensions that run through 2031. Because of a non-disparagement clause NASCAR added to the latest offer, almost none of the teams that signed are willing to talk on the record about the negotiations and how they eventually gave up on three of their critical demands.
23XI is largely represented in the charter fight with NASCAR by co-owners Denny Hamlin and Jordan confidant Curtis Polk, who arrived at Atlanta with two typed pages of notes he read to reporters to explain why the team did not take NASCAR’s offer.
Polk described the fight with NASCAR as “David facing Goliath,” with NASCAR essentially threatening to eliminate the charters if the deal wasn’t accepted by midnight. He said other teams “may have felt pressured and compelled to sign the agreement under significant duress.”
The position at 23XI was that the terms were “particularly harmful to our operations and our ownership group’s interests and intellectual property rights.”
What do the teams want?
The teams have always wanted four things out of the charter negotiations: a larger share of the revenue, a seat at the table for governance issues, a cut on business deals NASCAR does that uses team or driver likenesses, and, most importantly, for charters to become permanent, locking in stability.
Jim France, a son of NASCAR founder Bill France Sr. and current chairman, was never going to make the charters permanent and it became a major sticking point. The final offer did not include permanent charters; it also has language that would allow the series-owning France family to hold charters and field their own teams, according to multiple team owners.
Jeff Gordon, the vice chairman of Hendrick Motorsports and a key member of the team negotiating group, simply shrugged about the decision to sign the charter agreement when asked by The Associated Press. He noted that Jim France had individual meetings with several top team owners — a strategy Hamlin has described as “dividing and conquering” — and that most felt they were never going to get a better offer from NASCAR.
The new charters does provide teams with increased revenue, but how much is murky.
Multiple teams told AP the document was riddled with grammatical errors and not something ready for signing. The teams sent revisions — requests, actually — back to NASCAR and NASCAR’s response landed at 5 p.m. Friday at 105 pages long.
According to Front Row owner Bob Jenkins, the document was untenable to be reviewed in time to meet a looming deadline. The team shares many of the same concerns as 23XI, and Jenkins noted “I know a lot of people were uncomfortable but felt like they had to (sign).”
Brad Keselowski, co-owner of RFK Racing, disputed the notion that teams felt “forced” to sign and instead believes the teams had reached a point where NASCAR would give them nothing more.
He wouldn’t categorize the new charter agreement as “fair” to the teams.
“It’s one of these agreements that is only good when everybody’s just a little bit jaded,” Keselowski said. “I think there’s things obviously we would like to have better, but I think to some degree, there’s pieces that we really like, and there’s pieces not so much. But it’s hard to use the word ‘fair.’ I don’t know if I know what that means.”
What happens next?
It’s not clear what 23XI and Front Row will do next.
Polk wouldn’t say if the team will pursue legal action after earlier consulting with one of the country’s top antitrust and sports lawyers. If 23XI wants to go to court, it could try to force NASCAR — a privately owned family company — to publicly open its books.
“This isn’t the 1960s, and these predatory practices will not withstand scrutiny and be accepted in 2024,” Polk said. “NASCAR has superior bargaining power and undue influence over the sport and the charter process. They wielded this power continuously over the past few months and consistently rejected broad team requests on major issues while providing minor changes for pet issues that some teams requested in one-on-one meetings.”
Polk had no answer as to why NASCAR wants to take on Jordan, a global superstar who brings a new audience to the sport and is one of only two Black owners in the Cup Series. Polk said the last discussions 23XI leadership had with the France family were in May.
“I’m not going to speculate as to what we’re going to do,” Polk said. “We’re going to protect our rights, and whatever we have to do to protect our rights is what we’ll do.”
But he was clear on 23XI’s position and wondered if many who did sign are even aware of what is in the 105 pages.
“The contract offer took away essential rights, and we believe that all teams, including those who signed, may not have been given a true opportunity to negotiate or fully understand the implications of the contract terms,” he said. “It’s important to fully consider the long-term implications of these terms, which could be detrimental not just to all teams but to the sport as a whole.”
There’s nine races left in this season and both 23XI and Front Row are trying to expand to three cars for next year. They will theoretically need charters to do that — and right now, those charters are set to be revoked at the end of December.
