For those of us either new to the sport, returning after a fanship hiatus, or just never caught on to the Charter System before, here’s a quick recap of what we need to know and how it affects us.
Things to know about charters
The Charter System began with the 2016 season with 36 charters awarded to teams with consistent performance. An extension was announced in 2020 that will have charters continuing through the 2024 season. A charter is a guaranteed entry into a NASCAR Cup Series points race. This doesn’t mean that non-chartered drivers can’t enter; it just means if there are more entrants than starting positions, the non-chartered drivers will have to qualify for their spot.
Charters are the assets of their respective teams and, as such, may be sold or transferred as the team owners designate, within the parameters NASCAR has set forth. For example, a one-time temporary (single season) transfer to another team is allowed. A permanent sale of a charter to another team is also allowed. However, no team may own more than 4 charters. Charters can also be revoked if a team finishes in the bottom 3 in team standings for 3 consecutive years. Since charter team standings remain with the charter through transfer/sell, this rule could affect high-performing teams, too. The cost of acquiring a charter has gone up significantly since they were first introduced to the Cup series. One of the first charters sold went for $3 million; the most recent acquisition was over $12 million.
Team impact
So many fans are looking for JR Motorsports to make their move up to Cup soon. Most think it’s just a matter of time, maybe even in 2023. Charter access is going to be the primary factor in determining when JRM will make their move. Hendrick already has 4 charters (Cup maximum) so his stakeholder status in JRM is preventing them from moving up to Cup yet. Of course, they have plenty of options. JRM could step out without Hendrick and form a separate team exclusive of him or they could team up with someone else and form a new team. Those decisions will depend on financial backing and team strength.
Any team looking to expand will have to find a team looking to downsize to buy a charter from. Otherwise, they run the risk of not getting in a race at all. Fields are limited and there are times when all 36 charter cars show up and leave room for no one. Smaller teams with sponsorship issues may weigh the selling power of their charter versus staying in the game and running out of funding. With the “Bottom 3 for 3 consecutive years” rule, there are some teams who will be more likely to entertain buyouts at the end of the season. We’ve not seen NASCAR implement their charter seizure rule yet, but no one has made it to 3 consecutive bottom 3 seasons yet either. Buying a charter from an at-risk team isn’t without its risks, though. Charters purchased from underperforming or shuttered teams have their record follow the charter, meaning veteran drivers like Kurt Busch face revocation even though this is his first year with 23XI. Imagine the fears a new team with a new charter and a new driver face when they buy an “at-risk” charter. They have one year to outperform their competitors or risk losing it all.
Sport impact
Charters are more expensive now than ever before, making them a valuable asset for teams and a high commodity that others may not be able to afford. If new drivers can’t afford to buy a charter, we may not see new faces for a while. This is good for sponsors and established drivers and teams, as this means more return on investment for ad dollars and an increase in sponsorship commitment. Sponsors can have more confidence in their product being seen if they sponsor someone with a charter. Teams and drivers can build a stronger fan base with consistent appearances in each race. Fans are more likely to buy tickets to a race when they know for certain their driver will be there. More sponsor dollars and more fans in the stands equal increased revenue for everyone. Who wouldn’t want that?
Overall, like any change NASCAR makes, there are fans and opponents who will gladly vocalize their position. Eventually, most people grow to either appreciate or at least tolerate the change. As with any other aspect of life, NASCAR must grow and adapt to the changes around the motorsports industry in order to remain relevant and gain new followers. Charters are just one of those changes that had a lot of folks grumbling in the beginning but now have become a driving point in team decisions. Hopefully some additional clarification on what charters really are and what they mean to our sport will make it easier to accept that they are here for at least a couple more years. It remains to be seen if they will be extended past 2024, but it’s unclear how NASCAR could get out of having charters now that they’ve become a hot commodity worth tens of millions of dollars. For the foreseeable future, charters are here to stay.
Featured image source: forbes.com
