Honda Issues IndyCar Ultimatum

This week Honda has issued an ultimatum to IndyCar that if costs are not reduced, they will leave the series after 2026. It’s all part of this week’s Business of Motorsport.

I also have the latest drama between the FIA and FOM, why IMSA GTP has been such a success and the impact of NASCAR’s new media rights deal on the future of the series.

All this plus the latest sponsorship deals and partnership developments, global race team updates and two movers and shakers to learn from. Welcome to this week’s edition of the Business of Motorsport Roundup. Your source for the best curated motorsport-business news that racers can use.

Motorsport Industry News

Formula 1

Honda Issues IndyCar Ultimatum

As the F1 season for 2023 is now over, most of the talk in the last week has revolved around the ongoing tensions between F1 and FOM. While Jean Todt defends his presidency and throws some shade on current FIA President Mohammed Ben Sulayem, Jonathan Noble in his Autosport+ piece Why a 2001 decision is at the root of current FIA v FOM tensions explains why the infamous 100 year commercial agreement struck by the FIA has come back to haunt them.

While the original 100-year deal focused on the commercial exploitation of F1, it has morphed into something that is far bigger than just giving FOM the freedom to sell TV rights and other big earning opportunities. Along the way, the FIA has also given up control of various aspects – including timing, the control of certain passes, and sponsorship opportunities from things under its total control like the safety car – that it now believes should be under its remit.

Why a 2001 decision is at the root of current FIA v FOM tensions

Then of course we have the fallout from the investigation into Toto & Susie Wolff which Susie Wolff insists is a systemic problem at the FIA that demands change, while Toto Wolff has stated that Mercedes is in “active legal exchange” with the FIA over the allegations.

The Piranha Club is truly and actively in session.

Gernot Döllner, who took over as the CEO of Audi in September, has said the manufacturer will go ahead with its planned entry into Formula 1 in 2026. Despite rumors to the contrary, Döllner has now given the first indication he will not change course on Audi’s entry into F1. “There is a clear decision from the board, from the supervisory boards of Audi and Volkswagen, that Audi will enter Formula 1 in 2026,” he told Handlesblatt. “The plan stands.”

While reports in some quarters that were stating it was a done deal, the FIA has cautioned against talk that a deal to move Formula 1’s Spanish Grand Prix to Madrid is close, after revealing the project has still not begun key steps. “The Spanish automobile federation is where the process starts, because whenever there is a new competition that wants to happen in a country, you have to go to them. So, have the Spanish Federation received as of today this project to be analysed, studied and focused? No, they have not seen it. This special step has not happened yet.”

Finally, while he may not have an F1 team yet, Elizabeth Blackstock of Planet F1 argues why Andretti hold the key to unlocking further F1 growth in America.

What makes the prospect of Andretti Global so unique when compared to Haas is Andretti’s dedication to its home country. Whether in Formula E, Extreme E, IndyCar, or Supercars, the Andretti team is proud to fly the American flag and consider the best American drivers for its roles. Haas, meanwhile, appears to adopt the stars and stripes when it’s most convenient — such as during races in the United States.”

General Motorsport Industry News

Business of Motorsport

In major IndyCar news this week, Honda has revealed that they will leave the series after 2026 if costs are not reduced and have offered their suggestion of a path forward for engine manufacturers.

I think there are several areas where you could save money,” American Honda Motorsports Manager Chuck Schifsky told RACER. “The biggest way that you could do that is to take a page out of the development of the hybrid system. So the hybrid system, once it’s up and developed and in the cars, and you’ve worked out all the bugs, and it debuts, the bulk of that development cost is finished. Everybody’s using the same part. You can’t mess with it. Teams can’t take it to their super-specialized dynos to trick out their supercapacitor packs or any of that. And so one could look at that and say that we should probably do the same thing with the ICE, where it’s a spec engine; everybody runs the same engine. Ilmor could build it.”

Meanwhile, IndyCar CEO Mark Miles explains in Forbes the reasoning behind delaying the hybrid engine to the second half of the 2024 season. “The issue that has caused this delay has to do with production parts. We have continued to get information that made us not confident and not certain that we could get adequate production parts on some of the parts at scale so they could all be tested and in the hands of the team so they could make it to St. Petersburg.” But with all these delays and setbacks, some are starting to wonder about the series’ future.

In my final bit of IndyCar news, Marshal Pruett of Racer reveals that IndyCar is still working on a charter system similar to NASCAR. “The idea is to create, whether it’s through contracts or some other system of agreements, for the selected teams that obviously are the stellar teams that have had substantial commitments to IndyCar racing and been successful, for them to have more of a property right, more of an asset value, so that if the day comes when they want to get out, they have something they can sell besides their equipment in their shop.”

Business of Motorsport

In his Autospport+ article, Charles Bradley explains how IMSA’s GTP revival has proven worthy of its name. “I think this platform has really energised prototype racing for the fans. Our marketing colleagues are happy that there’s a lot more people engaged and watching it, I’ve never seen so many campers and people at Sebring glued to our race before. We’re lucky enough that we’re living through a renaissance of endurance racing and we’re writing part of the history.”

Two weeks ago I mentioned NASCAR’s $7.7 Billion media rights deal. Here are two articles that look at the implications of the deal for the series’ future.

AutoWeek looks at how a rebranded Phoenix dragstrip survived a death sentence to return to the NHRA schedule. “We were scheduled to close on June 30th. We held our last of every single event and we had our offices cleaned out. This was the end of the road for us. This was the end of the facility,” Buckman said during the Performance Racing Industry Show at Indianapolis on Thursday. “And at the 11th hour, Cassaundra Wallace (assistant general manager/legal and development) and her (Wild Horse Pass Development Authority Board) team were able to step in.”

New details of the impending sale of Touring Car Masters by the Australian Racing Group, including a price, have come to light according to Speed Cafe. Category founder Tony Hunter has been working behind the scenes for months now to broker a deal, which is imminently set to take place. “The sale is being billed by some as a ‘rescue’ of TCM, with Hunter said to be leading the charge given his affection for the retro series which he created just over a decade-and-a-half ago. He is furthermore understood to have put together a six-event calendar comprised entirely of rounds on the Supercars undercard, including four promoted by Supercars itself (compared to just one this year).”

Quick Takes on the Business of Motorsport This Week

Honda Issues IndyCar Ultimatum

Motorsport Sponsorship & Partnership News

Here are the latest motorsport sponsorship deals, partnerships and related analysis that were announced this week.

Alfa Romeo

The Business of Running a Race Team

Honda Issues IndyCar Ultimatum

In The Glorious Highs And Painful Lows Of Motorsport, As Told By Gradient Racing’s Andris Laivins, Jalopnik looks at Gradient Racing’s experience during the 2023 Petit Le Mans. “The business of race teams is just atrocious,” he told me. “I would legitimately really enjoy everything I do every day if I didn’t have to run the business. I hate trying to find money; it’s the opposite of my personality.”

Team & Manufacturer News

Here is a roundup of the latest team news from around the world of motorsport.

Buffomante Racing Enterprises

Motorsport Movers & Shakers

Business of Motorsport

Motorsport Magazine has a great profile of Brazilian Grand Prix promoter Alan Adler, an Olympian who worked hard to save the Brazilian Grand Prix which only 3 years ago looked to be in dire straits. “Signed in December 2020, the initial deal kept the race in Sao Paulo until 2025. November’s contract extension added a further five years, the new mayor having continued the support kickstarted by his predecessor.”

Business of Motorsport

If you ever wondered how Zak Brown thinks, Lewis Houghton has posted a great conversation with Zak Brown. “Zak mentions that technical sponsors, such as Dell and Cisco, are the main reason McLaren is one of the development pioneers in F1, as their technology can keep up with the demands of the team. He also attributes the leading sponsors to the record-breaking pit stop in Qatar.”

Mark Boudreau
Author: Mark Boudreau

Mark is the publisher of Motorsport Prospects. As a former lawyer, he applies his legal background and research skills to assist race drivers by showcasing the resources they need to make their motorsport careers happen.