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Racing sponsors now at a crossroads of performance, ratings and ethics

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The last several weeks have seen sponsor stories take over from on-track ones as the dominant players in the North American racing news.

NAPA, of course, has made the biggest announcement with its decision to leave Michael Waltrip Racing at the end of the year, in the wake of the controversy at the NASCAR Sprint Cup Series regular season finale at Richmond. 5-Hour Energy, additionally, seems displeased with the action the organization has taken in a statement it has released.

Other sponsors are on the move, which is normal in racing, but noteworthy in their timing after Richmond. Valvoline leaves Roush Fenway Racing for Hendrick Motorsports; Jimmy John’s goes with driver Kevin Harvick from Richard Childress Racing to Stewart-Haas Racing.

Castrol made the jaw-dropping decision earlier this year to leave John Force Racing at the end of 2014 in NHRA after 29 years.

And then there is the report this morning that GoDaddy is re-evaluating its role as a primary sponsor in IndyCar with Michael Andretti’s team, citing low television ratings as the impetus for a potential move out of full-time primary sponsorship there.

It all adds up to a fascinating question: Which part of racing do sponsors prefer most? Is it on-track performance, ethics, or ratings?

To borrow a term from NASCAR President Mike Helton, the “ripple effect” of the last few weeks has changed the corporate game in a way we haven’t seen for quite a while. Sponsors often come-and-go from racing but it’s become increasingly apparent the Richmond saga has made a bigger impact on all forms of motorsport than we might have realized in the immediate aftermath.

If it’s on-track performance you crave, ideally, IndyCar would be the best bang for the buck. It costs substantially less – think in the $4 to 8 million range – for a season-long sponsorship (by comparison to $15 to $20 million in NASCAR). A sponsor can advertise itself at the Indianapolis 500, the largest single-day sporting event in North America, and have the chance to win a variety of different circuits.

That said, the marketing and promotional aspect of the variety apparently does not justify the ROI as it stands now. Roger Penske, for instance, has had to put together a consortium of sponsors to field Helio Castroneves and Ryan Briscoe’s cars since Philip Morris tobacco money exited at the end of 2010 (livery was withdrawn at the end of 2009). Elsewhere around the grid, teams have become increasingly reliant on drivers bringing sponsorship to secure a seat. There’s still plenty of talent on the grid, but the days of fully-funded rides without bringing a dollar are drawing to an end.

NASCAR, meanwhile, can offer better TV ratings on the whole, with the performance aspect secondary. It’s why Danica Patrick, for instance – long seen by this writer and others as a good-but-not-great driving talent who has made most of her career via marketing – can afford to run 25th to 30th place every week, but maintain the GoDaddy support for the awareness and buzz she creates off-track.

Now, though, NASCAR faces an ethics crisis the likes of which it has rarely seen. If NAPA’s departure is the tip of the iceberg in terms of corporate America withdrawing its dollars, it could create another “ripple effect” – to borrow Helton’s words again – where more sponsors depart and hundreds of families see jobs go away. That might be an extreme way of looking at it, but it is certainly possible if sponsors don’t see the value in the tens of millions of dollars invested and the PR too damaging to their brands.

A good take from the Sporting News’ Bob Pockrass, linked here, suggests NASCAR needs to implement a “grand plan” to soothe sponsors and their concerns. Pockrass notes there are elements where NASCAR is already involved in direct communication with sponsors – notably via Chief Marketing Officer Steve Phelps – but that needs to expand in the wake of the Richmond controversy.

As a fan, you want to see sponsors – regardless of series – do the job of activating and creating a connection that spurs you to root for said sponsor and buy more of their product. As a sponsor, you ideally want to be successful in all three aspects of performance, awareness and moral standards.

Depending on the fallout the rest of 2013 as it relates to sponsor movement, we’ll see which of the three takes precedence in the motorsports landscape.

Haas F1 Team confirms partnership with Alpinestars

MEXICO CITY, MEXICO - OCTOBER 30:  Haas F1 Team logos during the press conference for their driver announcement on October 30, 2015 in Mexico City, Mexico.  (Photo by Andrew Hone/Getty Images for Haas)
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Haas F1 Team has confirmed a partnership with Alpinestars ahead of its debut season. The full release is below:

Haas F1 Team has named Alpinestars as an official supplier, with the world-leading manufacturer of professional racing products providing all of the team’s technical wear. Haas F1 Team will make its debut in the FIA Formula One World Championship this season, becoming the first American-led Formula One team in 30 years.

Haas F1 Team’s drivers – Romain Grosjean and Esteban Gutiérrez – have considerable history with Alpinestars. The company began working with Grosjean in 2011 when he was in the GP2 Series and with Gutiérrez in 2008 when he was in Formula BMW Europe.

Alpinestars was founded in 1963 and has been the leading innovator of performance protection in motorsports. Alpinestars’ products are developed by a large international staff with auto racing and motorcycling backgrounds at the company’s laboratories in the United States (Los Angeles) and Europe (Italy). To bring the world’s most advanced technical apparel to racers and consumers around the world, Alpinestars utilizes the latest technology for superior product development.

“In racing and especially in Formula One, every element of the team is analyzed to ensure it’s getting the maximum performance, and this includes human performance,” said Guenther Steiner, team principal, Haas F1 Team. “Alpinestars’ technical wear is light, breathable and comfortable, and provides unrivaled protection. It’s exactly what we need to keep our drivers and crewmen safe while allowing them to perform at their best.”

“Forming a partnership with Haas F1 Team is a natural extension of Alpinestars’ deep involvement in F1,” said Gabriele Mazzarolo, president, Alpinestars. “With our strong presence in U.S. auto racing and major research and development facilities in Los Angeles alongside our racing and product development centers in Italy, Alpinestars is well aware of the engineering strength and racing culture at Haas F1 Team. We look forward to working with the team as they enter Formula One and, going forward, know that we will share a strong and mutually beneficial technical collaboration.”

Thanks to Wehrlein addition, F1 has a rookie battle now set for 2016

xxxx during the Formula One Grand Prix of Russia at Sochi Autodrom on October 11, 2015 in Sochi, Russia.
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Last year, the rookie storyline in Formula 1 was an intriguing one, because you had three drivers in realistic points-scoring scenarios with Max Verstappen and Carlos Sainz Jr. at Scuderia Toro Rosso and Felipe Nasr at Sauber.

Then you had the lesser fancied rookie pair of Will Stevens and Roberto Merhi – and later a welcome five-race cameo from Alexander Rossi – at Manor Marussia.

Point being, there was a lot of “new” to digest in the 2015 campaign and until Manor’s confirmation of Pascal Wehrlein earlier Wednesday there wasn’t going to be much on the new driver front in 2016, with Jolyon Palmer the only first-year driver.

In fact, outside of Renault with a completely altered lineup of Palmer and returnee Kevin Magnussen, Haas F1 Team in its maiden season and with Manor set to complete the field, there have been no changes at all up-and-down the grid for 2016, making for a fairly static setting.

Neither Palmer nor Wehrlein is going to set the world on fire in 2016, but they’ll both be facing intriguing teammate situations and with lower expectations, have the opportunity to overachieve.

The rookie story won’t be a huge one this year, but the fact there’s now two first-year drivers on the grid means there is at least the potential of a story – both between them directly, and between them and their respective teammates.

In Palmer’s case, the 2014 GP2 champion will be fresh off a year of FP1 running and no actual racing, and matched up comparably to Magnussen, who spent the year sidelined after his unceremonious dumping by McLaren.

Magnussen will be keen to get on and assert team leadership within Renault, an opportunity he didn’t have afforded to him at McLaren, and reveal the talent those who’ve followed him through the ranks know is there.

Remember, hard as it seems to believe given McLaren’s downturn in fortunes through its nightmarish 2015, this was a driver who delivered a stunning runner-up finish on debut in Melbourne two years ago ahead of Jenson Button, in what was a McLaren double podium and the team’s most recent podium finish.

The closer Palmer can match Magnussen, and occasionally beat him – he’d have to hope more than Pastor Maldonado did to Romain Grosjean the last two years – the more his own stock will increase.

He’s a year and a half older than Magnussen so he’s at roughly the same career point, save for the single year of F1 race experience Magnussen has, so he stacks up more than favorably.

Wehrlein, perhaps, will enter Manor Racing with a slight edge over whoever his teammate is by the sheer virtue of the fact he’s been named to the team first, and he’s got the Mercedes tie-in as the team embarks with its new Mercedes power units – which ironically, were in the Renault camp last year, then as Lotus.

The 21-year-old German has been in line for a race seat for a couple years given his Mercedes reserve duties and occasional Force India testing; in theory, he’d have been a natural for Force India if one of its two drivers moved on or out for 2016. He’s a past DTM champion and he enters the sport highly rated.

He’s arguably Manor’s best rookie since the late Jules Bianchi three years ago, and the thinking could be that Wehrlein has the potential to overachieve at the back of the grid the same as Bianchi did in what was then a Marussia-Cosworth, in 2013, the final year of the V8 era. Once Marussia got Ferraris the following year, Bianchi’s stock only continued to rise.

Whether Rossi or Stevens gets the nod alongside – from an American standpoint, selfishly, you’d like to see Rossi confirmed and hopes are high in his camp he will – they’re probably going to enter the year on a slight back foot.

Reason being, Stevens was dependable but never otherworldly last season and Rossi, when he had his late season opportunity, left Stevens in arrears more often than not. In short, both seasons were incomplete, although in Rossi’s case, the potential was higher for more if he can continue into 2016.

Neither the Renault nor the Manor figures to be a frontrunner or even lead the midfield this season. Points will be at a premium; it’s going to be the moments where Palmer and/or Wehrlein outperform their teammates, get out of Q1, finish in the 12th to 13th range that will really catch some eyeballs or show their worth to the F1 world at large.

Fortunately though, the fact there is a rookie battle does add at least one intriguing subplot to the season.

Ganassi reveals livery, sponsor for Chilton’s No. 8 car

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Verizon IndyCar Series rookie Max Chilton’s livery and partnership for his No. 8 Chevrolet at Chip Ganassi Racing has been revealed.

The team’s full release is below:

Chip Ganassi Racing Teams (CGRT) announced today that international insurance brokerage and risk management services firm Arthur J. Gallagher & Co. will partner with CGRT’s No. 8 Chevrolet driven by former Formula 1 pilot Max Chilton in a full-season effort in the Verizon IndyCar Series.

Gallagher, headquartered in Itasca, Illinois, has operations in 31 countries and offers client-service capabilities in more than 150 countries around the world through a network of correspondent brokers and consultants. This season with CGRT will be the company’s first foray into the world of motorsport partnerships.

Earlier this month, Chilton was named driver of the No. 8 entry after making 35 starts in Formula 1 from 2013-2014 for the Marussia Formula 1 Team. Most recently he contested a partial season in the 2015 Indy Lights Championship with one win, six podium and 10 top-five finishes.

“Our organization truly represents a global team effort with 17 drivers from 10 countries, in 13 cars across six series,” said Steve Lauletta, President, Chip Ganassi Racing Teams. “We have teams competing in North America and around the world throughout the racing season on any given weekend, and the most diverse driver lineup anywhere in the sport. We’re excited that Gallagher chose our team to create a new partnership with, and we’re looking forward to bringing another new global brand into the Verizon IndyCar Series.”

“We are pleased to partner with Chip Ganassi Racing Teams in the Verizon IndyCar Series,” added Richard C. Tallo, Chief Marketing and Communications Officer, Arthur J. Gallagher & Co. “Racing has tremendous global appeal and millions of fans around the world. Numerous parallels exist between race car driving and managing risk. Both in business and on the racetrack, teams have to quickly assess, calculate and manage risk if success is to be achieved.

“For nearly 90 years, Gallagher has built a strong and well-respected global insurance brokerage services and risk management business. Each day Gallagher employees help our clients mitigate and manage their risks so they are free to grow their businesses. With this exciting sport and Ganassi’s racing leadership, Gallagher will have the ability to leverage a range of marketing activities to further expand our brand awareness.”

Pascal Wehrlein to make F1 debut with Manor Racing

SINGAPORE - SEPTEMBER 19:  Pascal Wehrlein of Germany and Mercedes GP arrives in the paddock before final practice for the Formula One Grand Prix of Singapore at Marina Bay Street Circuit on September 19, 2015 in Singapore.  (Photo by Mark Thompson/Getty Images)
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2015 DTM champion and Mercedes junior driver Pascal Wehrlein will make his Formula 1 debut in 2016 after securing a seat with Manor Racing.

Wehrlein, 21, has previously tested F1 cars with both Mercedes and Force India as well as enjoying success in DTM, Formula 3 and the German Formula Masters series.

After a long winter of speculation about his future, Manor has now confirmed that it will field Wehrlein in one of its seats for the 2016 season as part of its new technical partnership with Mercedes.

“Manor Racing is a great place for me to start my Formula 1 racing career. I’m very pleased to be here,” Wehrlein said.

“It’s a small and totally focused team and I soon hope to know everyone. Though it’s my first F1 season my aim is to help Stephen and the guys achieve their goals.

“It will be a tough challenge but I think we should be able to challenge for points along the way. It’s going to be good fun.

“A word for my racing family at Mercedes-Benz, and particularly for Toto, who have guided my career this far and made this opportunity possible. Thanks for the incredible support to help me achieve my dream; now it’s down to me to grab the moment and perform on track.”

Manor team owner Stephen Fitzpatrick was pleased to confirm the signing of Wehrlein, and believes that the German can make an instant impression in F1.

“Pascal is a sharp driver with a very promising future; Manor Racing is excited to have him aboard,” Fitzpatrick said.

“We’re a small team up for a big challenge this season, so we’ve chosen a driver with the talent and hunger to match our own on-track ambitions.

“Pascal has impressed in testing for Mercedes and Force India, together with commanding performances in DTM, culminating in the championship win last year. Manor Racing is perfectly placed to help Pascal make a big impact in his first season. We’re looking forward to it!”

Wehrlein’s confirmation leaves just one seat remains open on the 2016 F1 grid, with the identity of his Manor teammate still to be decided.

American driver Alexander Rossi, Britain’s Will Stevens and GP2 race winner Rio Haryanto are all known to be in the running for the seat.