To celebrate 50 episodes this season, Kevin Harvick welcomed NASCAR president Steve Phelps to the Happy Hours show for a wide-ranging conversation about the transition to the NextGen car, the ongoing charter negotiations and the aftermath of the final lap at Richmond and the resulting penalty to Austin Dillon.
The most notable takeaways can be found below.
The decision to penalize Austin Dillon
Phelps began this topic with praise for his officials but also the sanctioning body’s reluctance to issue penalties, but knowing sometimes they must in the name of integrity.
“Listen, honestly Kevin, we don’t want to penalize drivers,” Phelps said. “We don’t want to have cars not pass tech. All of that, we don’t want. But there is a responsibility, if you’re going to be fair about the rules you put in place and officiate, that you have to do it with the upmost integrity and I believe that all of our officials right now, Elton Sawyer and his team, they have the upmost integrity. I think you would be hard pressed to find someone who would say Elton Sawyer does not have the upmost integrity of someone in his position. So, you know, the decision, each of those is very unique and we have to treat them as unique.
“We try to look at all the data and figure out in their minds what happened. The difficulty, as it relates to this specific incident, and I’ve heard from drivers over the years, ‘I don’t know where the line is (and) can you show me where the line is?’ I can’t show you the line but you will know when it’s been crossed.
“So when you hook someone going 170 mph on a mile and a half race track, you have crossed a line and we’re going to park you. We’ve been consistent and we’ve had two of those. Do we want to do that? We do not but we need to make sure we keep our drivers safe so when you have a situation like that, it’s not safe.
“I think, as we were looking at the data and it happened so quickly, but you had two incidents in a split second — turn 3, an incident, and turn 4, an incident and the race was concluded. I think, the bump-and-run, the slam and run, or whatever you want to call it, I don’t know if there would have been a penalty but there was a second move, and that move was a hook in our opinion, which was both the eye test and the data.”
Harvick interjected here and said it is hard for anyone to run from the data. This was a reference to the SMT data that painted a pretty damning visual of what Dillon’s intent was on the final corner.
“It’s hard to hide from the data, right,” Phelps continued. “And he put a competitor at risk. Denny took a hard hit, one of the hardest hit I think he’s had in this NextGen car, and there was a line that was crossed. … Again, a decision that ultimately made by the competition group and it goes up to management, and if we don’t we believe they got it wrong, significantly wrong, we will not overturn their decision. It is their decision. They are the experts in this space. Did it go to Steve (O’Donnell), Jim (France) and myself? It did and we concluded they got it right and we issued the penalty.”
Kind of reading between the lines there, about the line, it continues to be more and more clear that the penalty was more about the second contact, with Hamlin, and that it was the right rear hook into the wall more that the dive bomb on Logano.
Make the penalty in real time?
One of the biggest points of contention about the entire Richmond ordeal is that the decision was not made in real time to immediately disqualify Dillon.
In fact, NASCAR waited two minutes to confirm the results, and did not issue a penalty until nearly three days after the fact, at which point, there was no option to disqualify the winner but only encumber the results.
Phelps says he is aware of the need to be able to make a call like that at the track before fans leave or turn off the television.
“We talked about that this past weekend, we had an all drivers meeting, and that was one of the things discussed. Would we like to see that? We would like to do that in the future. You have options — it’s a one lap penalty, a 15 second penalty or whatever it is. That’s something we will explore. Will it happen before the balance of the year? I don’t know. We don’t typically like to make changes, rules changes or procedural changes during the season, unless we think it’s in the best short-term interest of the sport.
“It’s something we will explore.”
“We’re not a demolition derby”
Phelps said the complexion of the rest of the regular season and playoffs would have changed had NASCAR deemed what Dillon did acceptable.
“If we hadn’t penalized it, I think what we would see over the next 12 weeks would look tremendously different,” Phelps said. “We can’t have that. What it really comes down to is ‘what do you want the sport to be’ and that’s why I think we ruled the way we did. We’re not a demolition derby. We’re just not. We are a sport that, if we had done nothing, we would have opened our door to a mess.”
Harvick agreed and said the racing decisions would have continued to escalate.
NextGen safety progress
The conversation then moved from the transition from the sixth-generation car to the current platform, which started in 2022.
The car, for the uninitiated, is a single source supplied spec car, meaning that every component is the same and must be purchased from the sole supplier that makes that part. This is all in the name of cost-saving and parity, with the car not yet really delivering on either promise.
The teams are closer, to be sure, but in a way that stifles competition and passing more often than not.
There are also still safety concerns, with this car being a little more dangerous in terms of concussive hits, compared to its predecessor.
“I’ll start with safety first,” Phelps said. “I think we made significant gains in the front and rear of the car and trying to soften those up so that the crush panels transfer energy in a better way and not go to the driver. The other area we have spent a lot of time on is the seat and head rest. I think we’ve made significant gains in those areas that have helped from concussions. Is it perfect? No. Will it ever be perfect? No.
“But I think our safety group really works hard, John Patalak and his team, because they care about the health and safety of our drivers. Was it ideal in 2022 with some of the things that happened? No. The rear of the car, when it backed it into the wall, we saw significant issues with driver health and safety. We addressed that as quickly as we could. It wasn’t a fix we could implement on a Tuesday and it took longer than I would have liked but it was necessary to make sure we were making the right changes, that wouldn’t negatively affect another area of the car, and make that a concern. This car’s initial safety …. We were looking to eliminate catastrophic harm or death and I think this car did that early and often but it caused other issues. So small impacts, to the rear and front of the car, was not to the satisfaction of the drivers, and because of that, it wasn’t a satisfaction to us, and I think we’ve come a long way and we’re going to continue to iterate on the car in different places, to make sure the drivers feel safe.”
NextGen competition pros and cons
The drivability of the car, if we didn’t have this current car, I don’t think the street races we’d have in Chicago would be even possible,” Phelps said.
That ignores the fact that the previous generation of car is still used in the Xfinity Series, and it races in Chicago each year too.
“I think you would have a very different show there over the past two years, which is interesting because, the car on the road courses is too good and that’s part of the issue, same with short tracks, that you can grab a gear and go … I think we’ve made some progress. You talk about (driver) aggressiveness with this car, and on larger tracks like our miles and a half and two miles, if you are not aggressive, you will get left behind, and I think the racing our drivers put on are the best races we’ve ever had, on those race tracks.
“I think we haven’t lost anything on the superspeedways. I think the short tracks are getting better. I thought what we saw at Richmond was really good, and not because of the option tire, I just thought it was better. Creating that softer tire with falloff is critical for our racing at the short tracks.
“I think at the road courses, we are better, and the experiment around stage breaks or the lack of stage breaks and bringing out the yellows, I think the cautions bunch up the field and creates more exciting racing. I know some people think that is manufactured, and maybe it is, but it is better racing.”
“I think the eye test and the data, overall, suggests the racing is better with this car than the previous car overall.”
Charter negotiations update
Steve Phelps says fans do need to care about this topic while also explaining where things stand with a deal needing to be reached before the start of next season.
“So, this is one of the first opportunities I’ve had to (talk about it) because we’re not going to negotiate through the media and we never have during this whole process,” Phelps said. “The teams have felt the need to do that. That’s fine. I think, listen, do I think charters will be extended? I do. Do I think it’s important that they’re extended? I do. I think it’s in the best interest of the sport that the charters are extended.
And I know fans don’t typically care about charters, they don’t care about team costs or the business side. They just want good racing. They want their favorite drivers to win. They want storylines. They want guys to hate. Drama and great racing.
“What I would say is that they should care. Healthy race teams put on better racing. The race teams have early on said they wanted three things — to be able to compete on the race track, in a strong sense, more opportunities for team in the middle and back of the grid to be more successful, they want to make sure they are cash flow even or at least break even as opposed to losing money, and I totally get that. The third thing is they want to increase the enterprise value of the charters.
“Essentially, I won’t get into what charters are selling for right now, but it’s significantly more than it was three, four, five years ago and way more than nine years ago because they didn’t exist.”
Phelps then got into the nuts and bolts.
“We have offered the teams more money,” he said. “I won’t get into what that looks like, but it is more money, because it was important to the race teams that they have more money and we agree with that. So our proposals, for awhile now, have contained more money that would go to the race teams. It’s important.
“I believe, and there are some people in our own building that disagree and within the race teams, trying to control costs is going to be critical.”
Phelps conceded that the NextGen car has been more expensive than he would have liked.
“Some of that has to do with the parts and pieces and how much they cost and some of it comes down to how many times you can use the part. If they’re using the part for one race and we thought it would have a shelf life of three races, that’s different. Or teams buying multiple parts and then scrapping three of them, and taking the best seven of them. Are things like that happening? Yes. As the quality control improves, we hope that won’t happen.”
Phelps isn’t sure if cost control will come through rules or a spending cap but says something needs to change.
“If it doesn’t change, in seven years when we’re again negotiating the financials of these charters, it will come back to them not making money or losing ‘X, Y and Z’ so we’ll always be chasing that. Typically, when more money is given, race teams will want to take every dollar and spend it to go fast, and it’s a vicious cycle. I get it, because if you don’t go fast, it’s harder to get sponsorship.”
Phelps message to fans:
- We want to make sure race teams have a level of profitability
- It is incumbent that cost containment is what gets them there
“And then there’s governance,” Phelps added. “The teams want a seat at the table and I think they should. I think they should have a seat early and often. At the end of the day, I do think it is NASCAR’s responsibility to have the final decision of what we believe is the best interest of the sport.
“I believe that Jim France and Lisa France Kennedy truly care about the sport and its legacy and they want to do what is in the best interest of the sport. I believe that that to be true. So, am I hopeful this will get done in the short term. Could it extend to the back end of the year? It could. It’s just hard. There’s been movement on both sides and now both sides do not want to move any further so what is the middle ground where those things overall, and that’s where deals happen.
“If we are in a position to where things are signed, and both sides feel they got something and lost something, that is probably the best deal we could have.”
How the NASCAR charter system works
The most interesting part of the conversation was when Phelps argued that the charters are not franchises. The teams, especially since Michael Jordan and Curtis Polk came in with their NBA backgrounds, have started to treat each charter like a franchise.
That’s why Denny Hamlin has argued that charters need to be made permanent because franchises are permanent. Phelps pushed back against that.
“The charters are not franchises,” Phelps said. “Stick and ball sports, you buy a franchise, but a charter is not a franchise. With a charter, you are buying a guaranteed starting spot. You are buying some known fixed revenue and you compete for the rest of the revenue.
“You get some level of governance. That’s what a charter is and where it stops. It is not a collective of 1/30th and representing 1/30th of the sport and has a commissioner that makes decisions for all 30 franchises. That’s the difference. But you go back to what a charter is supposed to do … does it provide some level of governance? Yes. Does it provide some level of enterprise value if I decide to get out of the sport? It does. Does it provide fixed and variable revenue? It does.”
The teams, by in large, just do not see it that way now and that’s a sticking point.
“I am looking forward to getting this behind us because it creates noise in our system that doesn’t need to be there,” Phelps said. “And I’m not suggesting that it’s a team thing solely or a NASCAR thing solely, it’s just how it has unfolded.”
What else do I need to know about the charter system negotiations?
What the charter system is
Why it’s a doomsday scenario if a deal is not reached
Teams hired top antitrust lawyer against NASCAR
Jeff Gordon on why the business model needs to change
Michael Jordan says NASCAR will die without charter permanence
Denny Hamlin says teams just want break even revenue
NASCAR’s June offer to teams ‘was worst yet’
Denny Hamlin on why charters need to be permanent
Smaller teams unified with larger teams
NASCAR, teams making progress on charter deal but hurdles remain
