An interview with: STEVE PHELPS
THE MODERATOR: Good morning. Welcome to Championship Sunday here at Homestead?Miami Speedway. This is our final media availability of the day and we’re pleased to have Steve Phelps, president of NASCAR, join us here in the media center.
Steve, let’s start off here with 2019 has been a season marked with great racing, some fairly significant industry changes, and some real momentum for our sport with ratings up and fan engagement on the rise. If you could talk about the 2019 season.
STEVE PHELPS: Thank you, everyone, for being here this morning.
Let me start by doing the same thing I did last year at this press conference, which is to thank the media. The race teams, the drivers, the crews are the ones that provide the compelling stories from the track. But it’s what you do with those storylines to amplify those to reach our fan base. I want to thank you for the job that you do. It’s important. Whether this is your first race of the year or it’s your 38th race weekend, I want to thank you for being here.
Secondly, I’d like to congratulate Matt Crafton, Duke and Rhonda, for their Gander Outdoors Truck Series championship. Matt’s third championship. I want to congratulate Tyler Reddick for his second consecutive Xfinity championship, and Richard Childress, the RCR folks, as well as Ford on Friday night and Chevy last night.
Really excited about what we’re going to see today. These four drivers and what they’ve done to get here I think is incredible. I think we’re going to see some phenomenal racing in front of a packed house, an unbelievable audience both from a television standpoint and then digital and social.
I think if you take a step back and you think back to where we were in February at the Daytona 500, it was an industry that was finding its footing, right? A sport that was finding its footing. You could feel the sport kind of rallying around itself. You could feel momentum that was coming, a real excitement.
The narrative that you all were talking about, the sport, it felt different, it felt different. That difference, in my opinion, really starts at the top. It starts with Jim France and his vision. Jim went to almost every race weekend this year, the 2019 season. He’s here because it’s important, and he’s here because he loves it. He loves NASCAR racing. He loves racing in general. That was the start of it, Jim’s vision and a plan to bring this sport to a place where we were being successful and were having success.
I would say if you take stock of where we are, I’d say we had an incredible season. I’m incredibly proud of the people who work in this industry and what they’ve done to execute against this plan. It not just NASCAR’s plan, it’s what NASCAR does and what others do to support what that plan looks like, race teams, drivers, tracks, our media partners and sponsors. It’s really important that everyone has come together.
I’ve been teased a little bit about using the word ‘collaboration’ too much. I don’t think you can use that word too much, frankly. It’s building. The collaboration of this industry is better than it’s ever been. Really excited about where that is.
If you look at the results, I start with the competition always, our competition right now in the intermediate tracks and the superspeedways I believe is the best racing we’ve ever seen. I’ll start with myself as a fan. I love watching and am super excited when we get to the intermediate tracks and superspeedways, the type of racing we are going to see.
Do I think we need to work with our industry, Goodyear, our race teams, our OEM partners to improve what we’re seeing on the short tracks? I do. We’re going to do that in the off?season, for sure.
The results from the competition side are working from a consumption standpoint. If you look at the fans, what the fans are doing, how they’re responding to it, if you look apples to apples, our ratings are up 4% this year. All of sports is down 9%, we’re plus 4%.
Importantly our share is plus 9, so there are fewer people watching television in all sports, obviously, but fewer people watching television overall. So when they were watching, not only did they watch more NASCAR, from a ratings standpoint, but when they were tuned in, they were watching more NASCAR. We were taking share from someone else, which is important. That’s television.
Our digital and social numbers continue to climb. They do because we’re providing great content, content on the racetrack. How we’re repackaging that both on race day, but also during the week, it is compelling and it’s working.
Then innovation, how are we going to find new fans and innovate and create engagement around existing fans but also new fans?
Three things I would highlight there. You look at our announcement on Thursday with TrackPass and NBC Sports Gold. We are thrilled with what that opportunity looks like. We doubled down from a grassroots standpoint. NBC has been a phenomenal partner on that.
If you look at the grassroots portion of what we’re going to see from short tracks, the ARCA Menards Series, what was K&N East and West, ARCA East and West, the opportunity to have IMSA on there, American Flat Track. These are important parts because if motorsports is growing, we at NASCAR, kind of the top of the heap, we are going to be growing, too.
What’s happened from a sports betting standpoint, we’re just getting our footing on that. If you look at what is the integrity portion of that, our relationship with Sportradar, then the distribution with Genius Sports, they’re important parts to continue to create engagement with our race fans.
Last would be Esports, what we’ve done with iRacing, what we’ve done with the Heat Pro League, those numbers in each of those series exceeded our expectations.
A couple more things here.
Importantly, again as you take stock of the season, one important thing, it was a lot of work that folks certainly worked on, was with the ISC NASCAR merger, which was completed roughly a month ago. It will be an important part of what our future holds, so the work that was done getting us to that point I think will pay dividends down the line.
You’re going to take the best of what was ISC and the best of what was NASCAR and create a bigger, stronger entity as NASCAR that will help service the fans.
I’ve also been teased pretty mightily on the fact that every time I come to a press conference like this, I talk about the fans. I’m going to continue to do that unapologetically. The first lens that we’re going to look through is what the fans are interested in having on the racetrack, how we service those fans. It’s critically important.
So our broadcast partners, teams, drivers, all important stakeholders. The most important stakeholder we have in our fan base.
Lastly, I just want to thank the media, which I did. I want to thank the industry. We’ve had a phenomenal season. 38 race weekends is a lot of race weekends. For me it went very quickly. I can’t believe we’re already at our championship race here in Homestead on this Sunday and going to crown a new Monster Energy NASCAR Cup Series champion. Whether it’s Kevin or Kyle or Martin, their second, or Denny’s first, it’s going to be phenomenal.
I do want to thank all the stakeholders. Our race teams, the crews, our tracks, media partners, everyone bands together to create success in this sport. I think that’s exactly what we’ve done.
With that I’ll open it up for questions.
There’s been a common theme with several people that have come into the media center this weekend, OEMs, drivers, team owners, about a more productive relationship with you and Jim this season. Do you agree with that? How has that relationship helped you navigate I’m sure differing priorities among those groups when it comes to the Next Gen car, the 2021 schedule, the new engine? Do you feel those initiatives remain on the schedule that you hope them to be?
STEVE PHELPS: Yes, a lot there. I will start by answering about the collaboration. We have difficult things that we’re solving and we have solved over the past year. Do I think it’s helped by having Jim France at the helm? I do. Again, it goes back to he’s the founder of NASCAR’s son. We’ll start with that.
The second is there’s to a person in the garage that doesn’t feel Jim’s presence in the garage, as well. As we’re looking to get the Next Gen car, which, yes, is on schedule for a 2021 launch, or other things that might not serve everyone’s agenda, because it’s difficult to do that. Do we believe there is there an added boost because Jim is there? Yes, we do.
Your recent comments suggest it isn’t said that ISM Raceway is going to host the Championship Weekend beyond next year. The 2021 schedule comes out in the spring. What needs to happen between now and the spring for Phoenix to be locked in as the Championship Weekend beyond next season?
STEVE PHELPS: For us, as I said in my opening, we need to make sure we are working with our industry, our teams, our OEMs and Goodyear, to make sure that the racing we have in Phoenix both in the spring as well as our championship next year is as good as it can be.
We’re going to announce that 2021 schedule, as you said, in the spring, probably around April 1st, which is a self?imposed deadline that we have for ourselves. Could that change forwards or backwards a little bit? It could.
Our promise to our fans, and we’ll do it right here, is that we are going to provide the best racing we can at our short tracks. I think we’ve overdelivered on the intermediate tracks, and we will make sure that when we get to Phoenix in the spring, and some of the other racetracks that are short tracks, that they’re going to have better racing.
What steps are you going to take to do that? NASCAR has said you’re not going to change the rules package for next year.
STEVE PHELPS: Again, we’re going to work with our teams in order to figure out how we do that, work with our OEMs to figure out how we do that. Everyone knows I’m not an engineer, I’m not going to play one now.
I am confident, having spoken to people who are far smarter than I am in this space, that there are things we can do. And I think our teams are excited about trying to partner with us to figure out what that looks like.
Can you cut a spoiler or go to the 2018 package for the short tracks next year? If so, when would you hope to have a decision on what you’re going to do?
STEVE PHELPS: Again, not to be evasive, but there are people far smarter than I am that could figure that out.
Yes, could we go to something that is a lower downforce package and do we think that will probably be one of the answers that we could look at to be successful on the short tracks? Yes. Whether it’s cutting off the spoiler, other opportunities for us to take some of the downforce off there, those are things that we’ll explore. No specific timing.
In terms of growing the fan base, you mentioned the Heat Pro League, iRacing, are you seeing or can you measure in sort of crossover or synchronicity between that and creating physical fans who come to the track and those that watch on TV?
STEVE PHELPS: I think it’s difficult to do. We have a 12 million fan database that we use to try to talk to our fans, get content that’s distributed. I kind of compartmentalize them, but they all add up to a summation of how you need to grow this sport.
We had an NBC motorsports conference early last December that Sam Flood put together. What Sam did and his team, they created opportunities for folks to talk about the different things that each motorsport was doing.
I’m proud to say that every single one that they looked at, we had some type of thing in the pipeline in order to help grow that fan base. It really to me is as simple as trying to service that fan wherever they are, whether they’re an existing fan or creating new fans that come into the sport. We’re seeing some successes there, for sure.
We have a stated goal of getting younger and more diverse. If you look at the numbers, we are doing exactly that in terms of self?identified fans, those that consider themselves to be fans.
Sponsorship, where are you? When do you expect to say anything on that?
STEVE PHELPS: This is about our championship, and we wanted to keep it about that. We also wanted to make sure we were making sure we were true to Monster and their three years. Monster has been a phenomenal partner for us. They’ve had significant success with their sponsorship and entitlement.
We have moved to a different model. I’m not going to get into what the announcement is, but we’ll have some announcements in Nashville around that new sponsorship model that we’re super excited about.
Roger Penske’s recent business moves, does that strengthen NASCAR’s relationship with the Speedway itself? Now that NASCAR owns racetracks, he owns a series, that maybe leads to a deeper partnership down the road?
STEVE PHELPS: Yeah, listen, Roger Penske is a phenomenal businessman. Everything he touches seems to work, which is great, whether it’s on the racetrack or off the racetrack. He’s got a decades?long relationship with the France family.
I personally have known him for 15 years. He’s a man of his word. He works hard. He makes sure whatever he is doing, he is trying to do it with excellence.
Do I think he will improve the good work that’s been done by Doug Boles and Mark Miles? I do. I think the investments he’s going to make, how he approaches things, will be slightly different. I think it will be improved.
The race in Richmond, coming back on the schedule, will there be opportunities for other races at our racetracks? I’m not sure. It’s certainly something that we’ll explore. I know Roger and Bud and Walt and the team won’t be shy about coming to knock on the door to say, Hey, what do you think about this? We will certainly entertain that.
Formula 1 recently introduced the cost cap for teams. While costs have been something that’s almost a non?stop topic in this sport, there isn’t a cost cap yet for teams. When is that going to happen? Are there some elements that mirror what Formula 1 is doing?
STEVE PHELPS: I think reasons to go to this new car, one is to take what is great racing, will be great racing in 2020, to create better racing. I think this new car will do that, this Next Gen car.
Another component certainly is around relevance. Our OEM partners were here looking at the showroom car or the street car versus what our racecar will look like. It’s going to be extraordinary. We are going to put the ‘stock’ back in stockcar.
The last component of that is to try to make sure that the costs associated with the car are not such that they just continue to escalate on that car. Whether we are going to have a cost cap moving forward, I don’t know. It is not an easy thing to do. We want to make sure that we have competitive racing. When the race starts, we want as many folks and drivers to win that race as they can.
Lots of work to do on what we would do, whether we would have a cost cap or not. But it is something that we continue to work with our race teams on to make sure that we are having competitive race teams and race teams that are profitable.
When you say you don’t know if you’ll have a cost cap, why wouldn’t there be a cost cap? Wouldn’t that seem like a logical step to help with the teams?
STEVE PHELPS: We’re going to see, right? We’re going to see how it works with F1. A little bit of a wait?and?see approach on that.
It is not an easy thing to do, right? How are you going to make sure the costs are being captured fairly and smartly across the race teams? It is a slippery slope. It doesn’t mean that it’s not a good step or it doesn’t mean we’re not going to get there. It means that we’re going to study it very closely. We’re going to study what they’re doing, continue to work with our teams and OEMs to make sure whatever we do moving forward makes the most sense for our sport.
In speaking to IndyCar’s Mark Miles a month or two ago, he mentioned in terms of trying to do a doubleheader with NASCAR, might need to wait till 2022. Whether it’s an exact percentage or a general sense, how far along is the 2021 schedule from being done?
STEVE PHELPS: We’re having a lot of discussions right now on the 2021 schedule. We’re looking at three things when we’re looking at that race schedule. We’re looking at where we’re going to have the most competitive racing that we can have, where we’re going to have full grandstands, and what does that market look like, is it a new market that we can service.
There are a lot of discussions that are going on both internally and then with other owners of racetracks. We need to obviously work with Speedway Motorsports, work with the three independent tracks that we have, then the tracks that we own as NASCAR now.
Again, we’ll look through that same lens. I think it’s important to do that. This is the first time I’ll go back to the fans. It really is about the fans. We need to make sure we are putting on compelling racing and having full grandstands when we do that.
You said a couple times the Next Gen car is on track for 2021. Can you give us some specific goalposts about some of the elements in that timeframe, such as when will teams take delivery on the new car, when will vendors be selected in that process. Also there’s talk a NASCAR team is bidding to be part of this process and build a significant part of the car. Is NASCAR comfortable with that arrangement?
STEVE PHELPS: So, yes, the car is on schedule, as I said. With that said, we’re going now through an RFP process, RFPing different parts of the car. There are parts that fans don’t frankly care we’re competing, and other parts fans care we’re competing. Also our OEM partners, certain things they want to compete at, certain things they don’t care about.
We’re in the RFP process. We’re on the track already at Richmond. We have another test coming up in a couple of weeks.
When the teams will take delivery of that car, probably in the July timeframe of when the cars will start to be delivered.
I have to give a shout out to, again, really the entire industry because they’re working collaboratively, working together. NASCAR runs the process, but there are teams that are involved, OEMs that are involved, and that’s how we’re going to be successful moving forward.
With respect to those that are in the RFPs to build the car, I don’t want to get into specifics about where that is. There would obviously need to be a separation between that race team and whatever either part or the vehicle itself that’s being put together.
If there is a team that is interested in competing for what that’s going to be, it would have to be kind of removed from what that organization is, if that makes sense.
Have you begun to engage any of your existing TV partners in talks about extensions? If not, when do you expect that to start occurring?
STEVE PHELPS: We have not. We are through 2024. I would say we’ve got two phenomenal media partners. I think you look at Thursday’s announcement with NBC, it’s just another important milestone for us or win for us to make sure that we are partnering with our media partners smartly.
There are a lot of rights negotiations that need to happen in advance of ours. We will take a very measured approach to what we’re doing. In the interim, we’re going to continue to do what we’re doing in order to engage the fan base, be smart about what those opportunities look like, continue to grow ratings, continue to engage our media partners, whether it’s an OTT platform like with NBC, or other content or promotional opportunities.
If you look at what we do from a marketing standpoint with our broadcast partners, our media partners, it’s significantly different than it used to be. Joint creative, promotions from an affiliate standpoint, both from FOX and NBC. No other sport is doing that other than us with them.
I can tell you they’re incredibly appreciative and it’s working. For us, it’s building on the successes that we have. Whenever we do get to that point of sitting down with our media partners to talk about an extension, they’ll be absolutely eager to do that and then extend.
If you can critique yourself, what was your highlight, what you want to work more on? Has any manufacturer, anybody right now, looking to come into the sport in addition to the big three?
STEVE PHELPS: I’m not very good at the first about talking about myself. But I got plenty of critiques. Highs? Really for me, to pick one thing, I’m so proud of what the industry has done together, whether it’s the Next Gen car, and that continuing. Ratings and engagement being up overall. Just some of the phenomenal racing we’ve seen. It’s hard to pick one thing.
Listen, we are fairly self?deprecating. We need to work hard and we need to execute against the plan. Are there things we didn’t execute against the plan? There are. There are behind?the?scenes things that people don’t see. We’re just going to get better and better.
I have the good fortune of working on what is the combined ISC as NASCAR. I think we’ve got the best team in sports. I’m very, very lucky to work with those individuals.
Then working with the industry broadly is incredibly important. We’ve seen a lot of really good things.
Shifting to your second question on the OEMs. Yeah, we have a lot of dialogue. We had some folks out in Phoenix that were interested in coming into the sport. It’s important for us. We are working hard to try to determine kind of the timing of that, what that looks like, and what that partnership would look like moving forward bringing someone in.
The world is a lot different than it was. We’re trying to make it as easy as possible to have an OEM come in, plug in, and start to compete on the racetrack.
The question about the new car, the engine, I kind of want to focus on the engine. There’s been rumors about ‘push to pass’ or stored energy. Fans worry about taking away the combustion part of the engine. Can you address some of those issues, what that model is going to look like?
STEVE PHELPS: I think Steve O’Donnell has talked about this quite a bit.
I do think for a new engine, that engine will have some type of electrification, some hybrid that will be part of it. It’s kind of a follow to the question, in fact, I know for a fact we will not have a new OEM unless we change our engine.
This engine is going to sound significantly the same as whatever the current engine is. We’re not going to have a bunch of electric cars going around. That’s not what this is about. It’s about having a relevant engine to our OE partners, both the existing Ford, Chevy and Toyota, as well as whoever the new OEs that we’re looking at.
Some form of hybrid, some form of electrification is going to be required, whether it’s stored engine or whatever that might be is down the line. But ideally creating a single engine package as opposed to taking an engine and kind of choking the horsepower down, is something that I believe we will ultimately get to.
What that looks like frankly will be a discussion between ourselves and our existing OEs because we need to make sure we are taking care of them first and foremost before we get a new OEM into the garage. They have been incredibly supportive of that.
We’ve had a couple of different partners come to the racetrack. We had some last week. We had a group that came when we were at Talladega. Each of the OEs showed them what they do, this is what Ford does, this is what we do at GM, this is what we do at Toyota. That’s incredibly helpful. They, too, want to be able to compete on the racetrack with other OEs.
When they came in here yesterday, they talked about having identifiable engines. Would that continue?
STEVE PHELPS: Yeah, no question. I think it’s really important for them to have not just a body style that looks like, but also an engine that is their engine. I think that will be an important component moving forward, as well.
Is NASCAR considering any type of initiative to encourage new ownership in the sport?
STEVE PHELPS: I think it’s important that we get new ownership in the sport. I do believe this Next Gen car will help with that, frankly, because I don’t think you’re going to need to be a manufacturer, try to manufacturer as an OE or as a team, which will be a much easier model I think for them to say, Hey, I see where this sport is going.
I think this Next Gen car will kind of be at the center of getting new ownership into the sport.
THE MODERATOR: Thank you, Steve. Appreciate your time on this. Let’s have a great race day.
STEVE PHELPS: Thank you, all. Appreciate it.
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