Sep 22, 2008

Lack of Sales Kill Dodge Truck Racing Support

The credit debacle revolving around the collapsing housing prices in the United States is getting a lot of ink these days, and the fallout from that crisis has already reached into the racing community. Hit hard by the combined effects of the credit crunch and high gasoline prices, Chrysler’s sales in the U.S. have gone off the cliff, down 35 percent through August versus the company’s sales in 2007. Dodge brand sales are down about 25 percent, which led very directly to Dodge’s recent decision to pull out of NASCAR’s Craftsman Truck Series. You might see a Dodge truck on the track next year, but if you do, that truck will be lacking any monetary support from Dodge. And with the American vehicle manufacturers reeling, we have to wonder if this isn’t just the tip of the iceberg.

In the salad days of racing, factory-backed teams in the Sprint Cup, the Nationwide series and the Craftsman series dominated. But a lackluster economy and a continued inability to connect with large portions of the car-buying populace has sent the fortunes of American car companies on a long downhill slide, while ironically, NASCAR racing has never been more popular. So much for “win on Sunday, sell on Monday.” Even Toyota, the only Japanese nameplate to compete in NASCAR, has not been immune from this year’s downturn. Toyota’s U.S. sales this year through August were down more than nine percent. That’s not a 35 percent drop, but it still yanks millions out of Toyota’s overall North American budget.

Dodge had an impressive run in the NASCAR truck series, winning championships in 2004 and 2005. But more recently the brand began to scale back on trucks, preferring to concentrate its resources on the more visible Sprint Cup series. Up until now there has been no announcement that Dodge will be peeling back its Sprint Cup efforts in 2009, but you can bet the budget won’t go up next year.

As this is being written, Chrysler, Ford Motor Co. and General Motors are collectively lobbying for $25 billion in direct loans from the federal government, and several of their executives have hinted that if the loans are not forthcoming, the situations within all three companies will be very dire. With this as a background, it doesn’t seem a propitious time to sink tens of millions of dollars in auto racing. 

The likely outcome is that we will see continued cutbacks from the auto manufacturers in all forms of racing, up to and including Sprint Cup. And we are unlikely to see this trend reverse itself until, and if, the domestic automakers return to some semblance of their former glory.