This month we will take a look at the relationship between the sports leagues and their teams during the pandemic.
These unprecedented times created an operating environment never seen by the sports industry. The shutdown eliminated live sports for weeks during each respective season.
Each entity developed a playbook for its return. This involved working with each stakeholder, most importantly the government and public health officials. Months later, it is still a work – in – progress, with changes being made as needed.
The largest professional sports leagues took its time to return. Being desperate and Rushing back too soon had its downsides. The stakes were high – risks associated with failure not acceptable. Being patient paid dividends.
Financial resources matter. The ability to test, monitor and establish protocols was not cheap. Hosting events without fans was lost revenue. Being able to weather the monetary carnage is not easy. Media contracts softened the blow.
Working with municipalities was both a necessity and requirement. They could not just say professional sports are coming to town, so let us play. Authorities established strict guidelines and protocols that applied to everyone. Select local governments in the Southeast deemed motorsports an “essential business” – making it easier to have races in their home market areas.
There was a collective spirit on all levels. Everyone was affected and in this together. They were eager to get back, willing to follow guidelines and rules, and treated following them as a source of pride. Bonding under the taglines #racingtogether and #togetherwin – motorsports led the way.
NASCAR was one of the first series back in action. Ten weeks after stopping at Phoenix, it restarted in Darlington. It has raced consistently since then and plans to finish the season on time in early November.
They established a protocol that emphasized safety and efficiency. Essential personnel were limited and social distancing was recommended. Schedules were tightened with one day shows and no qualifying becoming the norm.
At track temperature and symptom checks awaited entry into the garage areas.
However, NASCAR did not require covid-19 testing citing availability and accuracy. Personal responsibility was emphasized for monitoring each individuals situation. This was different than other professional sports leagues that administered tests daily under the bubble environments.
The Race Team Alliance serves as collective voice for teams in their discussions with NASCAR. This dialogue covers the competitive and commercial aspects of racing with the ultimate goal of betterment of the sport for all.
The Charter System was established in 2016 for a term of five years, and was recently extended until 2024. There are a total of 36 charters, currently owned or leased by about eighteen teams. Three teams (Hendrick, Gibbs, Stewart-Hass) have four each.
They receive about $260 million annually thru various prize winnings and purse programs. Nascar’s annual media contracts with Fox / NBC is worth an estimated $850 million.
Central to Formula One’s existence is the Concorde Agreement. This contract is between the FIA, Formula Teams and Formula One Group. It serves as the foundation for the competitive and commercial success of the sport.
The terms specify how teams must compete in races and broadcast revenues are distributed. Details are confidential but public stock filings by Liberty Media provide insight.
Ten Formula One teams have agreed to the terms of a new Concorde Agreement. This expires in 2025. The annual prize money pool is about $1.0 billion with Ferrari receiving the largest share. Teams have also agreed on set of competitive regulations which include a budget cost cap for teams of $145 million.
The unprecedented economic challenges related to the pandemic has forced everyone to reassess their operations. Negotiations between the sanctioning bodies and teams may have dragged on, but were put on the fast track. Working together for the best interests of the sport will assure for a more sustainable and competitive environment well into the future.