NASCAR: GM cutting back on NASCAR spending
Troubled General Motors has notified two racetracks that run NASCAR events that their current contracts will not be renewed as part of an overall $10 billion cost-cutting program.
That seems to be just the first step in what could be a huge drop in support by GM, Ford and Chrysler for tracks and teams in NASCAR’s top three professional divisions, the NHRA and other racing series in the face of the weakest U.S. auto sales in a decade.
GM announced Tuesday that it had suspended its stock dividend and will sell up to $4 billion in assets, moves made necessary by the downturn in sales and the rising cost of gas.
And motorsports sponsorships will not be exempt from the cutbacks.
“Like all areas of the business, these areas have not gone without a certain level of scrutiny, and there will be modifications and changes in our promotional footprint in all of those areas,” Troy Clarke, president of GM North America, said Tuesday. “We’re not going to talk about the details today, and specifically NASCAR, but all those areas have been reviewed and will continue to be as we work these action plans through.”
Speedway Motorsports Inc., which owns eight tracks that hold NASCAR events, already has been told GM will not renew contracts at two tracks ó New Hampshire Motor Speedway and Bristol Motor Speedway.
Scott Cooper, vice president of communications for SMI, said nobody is panicking.
“We’ve seen bad times with the economy before, and we’ll likely see them again,” Cooper said Wednesday. “At the end of the day, we’ve still got a sport that pairs up well with the American car manufacturers. We believe the sport will continue to have tight relations with those manufacturers.”
GM has contracts with 12 of the 22 tracks where NASCAR’s top Sprint Cup series races and is the title sponsor for the fall race at Richmond Raceway.
Cooper said SMI expects GM and the other American car companies to continue purchasing hospitality, suites and track displays, although perhaps not at the same level.
GM also is the official vehicle provider for Daytona International Speedway, owned by International Speedway Corp., and a track spokesman said they have not been notified of any impending change.
It is expected, however, that all car companies racing in NASCAR and other American series will be forced to make cuts before long if the economic downturn continues.
SMI and ISC, both publicly owned companies, have seen big drops in their share prices this year, and the loss of what could be millions of dollars in sponsorship money and promotion likely won’t help the situation.