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NASCAR set to pivot to new business model, executive says ... unless it doesn't work

NASCAR could start 2019 with a new business model if plans to replace Monster Energy with a bundle of sponsors pans out.
NASCAR could start 2019 with a new business model if plans to replace Monster Energy with a bundle of sponsors pans out. AP

NASCAR's Cup Series is hoping to move away from naming rights deals to a new business model after 2019, but a one-year deal to extend Monster Energy's sponsorship of the circuit through next season will serve as a bridge.

Tuesday's announcement of the one-year extension with Monster Energy to remain as the Cup Series title sponsor was expected.

But what followed was unforeseen — because if NASCAR's plans for the future succeed, the sport's financing will look markedly different from any time in its 70-year history.

NASCAR chief operating officer Steve Phelps said Tuesday that NASCAR's extension with Monster was only for one season — instead of the anticipated two or more — because the sport is looking at pivoting to a different business model.

Phelps said NASCAR is looking to disengage from a naming rights title sponsor, and instead will attempt to "bundle" sponsorships with TV networks, tracks, and the sanctioning body.

The Cup Series has had a title sponsor since 1971, when Winston came on board. Nextel, Sprint and Monster Energy followed.

But starting in 2020, instead of a brand having the naming rights to NASCAR's Cup Series, the top circuit will instead be just "Cup Series" or something similar, such as the "Premier Series."

The one-year extension with Monster Energy gives NASCAR time to develop and sign the bundled sponsorships needed to offset the loss of a title sponsor.

Phelps said he did not anticipate Monster Energy severing ties with NASCAR altogether. Monster could remain as an official partner, such as the official energy drink on NASCAR, without being the title sponsor.

Phelps said that while the idea of eliminating a title sponsor is something that has been kicked around before, the logistics of how it will work are still fairly preliminary.

But what if the plan doesn't work? What if NASCAR decides, after investigating this model, that it is better off just sticking to what has worked and re-upping a title sponsorship?

Phelps said that's a possibility — but that it won't be Monster Energy.

"We're going to explore a different model because we think it will benefit the industry," Phelps said. "If the sponsors come back and say that they're not sure this is the best avenue for us to partner with, then we'll have to pivot and look in a different direction. Could we go back to an entitlement partner model for our top series?

"We could, but again, that's not our intention."

The heroes of NASCAR, well we all know their faces and names, but the unsung heroes are the truck driver's who make sure their $2 to $3 million dollars worth of equipment and cars make across the country to each racing venue in one piece.

Brendan Marks: 704-358-5889, @brendanrmarks

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