Many individuals drive fast only for the thrill of it; but, for the fortunate few who make it as NASCAR drivers, driving fast is more than a hobby; it’s also a profession. Being a NASCAR driver may appear to be a fantastic way to make a livelihood, but at the end of the day, it’s still just a job. Many people have a stake in NASCAR, especially those who bet on the sport using NASCAR odds.
So, how does NASCAR take a bunch of fast-moving automobiles and turn them into salaries for the drivers and teams involved? Ticket sales, merchandise, endorsements, and sponsorships, as well as prize money – the money up for grabs at each race — used to be a lot easier to answer. Things changed in February 2016, when NASCAR leaders and team owners unveiled the owner charter system, a long-term arrangement.
Purse Money in NASCAR
From NASCAR’s inception in 1948 through 2015, the stock car racing series included what’s known as “the purse” in the box scores for every race on the calendar. Drivers would work out arrangements with team owners for a wage as well as a share of the weekly payout. The purses were determined by the race’s size and prominence; large tracks had large rewards, while minor tracks had smaller payouts.
Anyone interested in learning how much money was being given out for the race that weekend could easily do so. You may even find out how much the race winner put into his bank account.
For example, the figures were large in 2015, the last year before the charter system was implemented. Denny Hamlin got home $166,760 for winning the 2015 STP 500 at Martinsville. Joey Logano, on the other hand, received a massive $1,586,503 when he won Daytona that year. That is by far the most money won in any race that year. The Texas Motor Speedway had the second-highest prize pool, with Jimmie Johnson taking home $523,501, less than a third of the Daytona prize pool.
Explanation of the Charter System
Because the new charter structure produced 36 ownership charters in NASCAR, it revolutionized the way drivers are compensated. These teams have consistent sponsors and drivers, as well as consistent racing results. According to Autoweek, each of the 36 ownership charter teams receives a part of the benefits of racing in the NASCAR Cup Series, including a guaranteed starting place in each race. In addition, there are four open clubs in the system with no guaranteed revenue. Newer teams looking to enter into the Sprint Cup circuit can use these spots.
However, the value of each charter varies. Their worth is determined by factors such as the team’s historical relevance and the car’s rankings across several seasons. Guaranteed income, the team’s success over the previous three seasons, a points fund with cash payments, and the race purse, which is paid out depending on a driver’s finishing position, are all factors in the chartered teams’ compensation.
Teams can sell or transfer their charters to another team. In addition, if a team finishes in the bottom three of the 36 charter teams for three years in a row, NASCAR can remove the team’s charter. Despite claiming that its new financial structure would be open, NASCAR will not reveal how it distributes prize money, even to select drivers. Under this approach, money is now given to teams rather than drivers.
The Prize Money Is Still Huge
While the recipients of the funds have changed, the quantities have remained quite constant. The race purses are still substantial – if you can dig and locate them. We know that the prize for the season-ending 2021 Phoenix race was over $10 million and that the purse for the 2021 Martinsville race was about $8 million.
However, handbags aren’t as large as they formerly were. We received another look at the money paid to teams at the bottom end of the new system thanks to BK Racing’s bankruptcy case in 2018. BK Racing finished in the back half of the field on a regular basis. BK Racing won $428,794 for 20th place at Daytona, the highest-dollar event on the schedule; otherwise, the team never made more than $100,000 for any race.
Smaller teams may reach a deal with the driver in which the team receives the purse to help support the car and the driver receives a payment from the team. Alternatively, they could do the polar opposite and pay the driver the purse instead of a wage, giving them the incentive — pun intended — to compete more fiercely for a better finish.
