Honda, Audi Cut Back Racing, but Ailing Detroit Says Nothing on NASCAR
December 08, 2008
By Bill Visnic
Honda Motor Co. Ltd. and the Volkswagen Group's Audi AG announced last week they are leaving two high-profile racing series. Honda cited the widening global economic crisis as the reason for pulling out of Formula 1 racing, generally considered the pinnacle of motorsports endeavor.
Audi didn't directly say tightening economic conditions are the reason it will no longer compete in the American Le Mans racing series, but it's likely at least one factor. Audi was using the ALMS series to presumably good effect, however, to promote the diesel engines that power its ALMS racers, tying in that aspect with the company's launch of production-vehicle diesels in the U.S.
The pullout by Honda, which prides itself on advanced engine development often trickled down from racing, is particularly illuminating: if Honda can so quickly cut its ties with high-profile (and equally high-cost) racing, why, then, do the Detroit Three automakers cling so tenaciously to their involvement in NASCAR racing?
The Detroit automakers last week presented to the U.S. Congress detailed restructuring plans concocted to allow them to once again become profitable after the infusion of billions of hoped-for taxpayer dollars. Chrysler LLC, Ford Motor Co. and General Motors Corp. are axing all manner of expenditures in the attempt to keep the lights on -- yet their restructuring "blueprints" said nothing of reviewing, much less eliminating, their multimillion-dollar annual expenditures on NASCAR sponsorship.
This at a time when interest in NASCAR is documented to be waning, and critics of Detroit's hidebound connection with NASCAR have long contended the relationship does virtually nothing to help any of the Detroit Three automakers sell production cars.
A bill being assembled by Congress this week will attempt to quickly channel funds to the Detroit automakers to carry them through the first quarter, and it may contain several strong controls on how the automakers spend money -- but for now, it appears the automakers' marketing strategies and expenditures, though extending to budgets of several hundred million dollars, have flown under the radar screen of scutinizing lawmakers.
If a company such as Honda -- in demonstrably better financial position and arguably gaining more from its racing connections than any of the Detroit Three -- can so quickly and decisively cut its racing investment when business gets tight, it seems incredulous the domestic automakers have not taken similar measures to put their NASCAR investment to better uses -- matters like keeping the lights turned on.
The Associated Press reported in early November NASCAR chairman Brian France as saying he questioned whether Chrysler, Ford and GM would be able to continue in NASCAR, but confidently predicted the series could survive without them.
"We're also not going to live or die if one manufacturer or another has a pullback or pullout," France told the AP.
"I hope it [a pullout by one or more of the Detroit automakers] doesn't happen. We're working like mad to make sure it doesn't happen, but the sport is on very solid ground that transcends one manufacturer or another."
In October, Ford, for one, signed a five-year extension of its sponsorship of longtime partner Roush Fenway Racing. At the time, Ford Racing Technology director Brain Wolfe was quoted as saying that despite tough economic times, Ford continues to believe in the return on investment in its involvement with NASCAR.
Photo by Honda
Although Honda is remaining in some forms of racing, cost-cutting is leading it to withdraw from Formula 1, widely believed to be the highest-profile racing series in the world.
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