NASCAR: How Much Is A Cup Series Charter Worth?

Jasen Vinlove-USA TODAY Sports
Jasen Vinlove-USA TODAY Sports /

The introduction of the charter system into NASCAR changed the sport forever, hopefully for the good. However, how much are these charters worth exactly?

When it comes to the NASCAR Sprint Cup Series in 2016, the charter system is where its at. If you’re a new team and you want to be guaranteed to make every race, you will need a charter. If you don’t have a charter you will have the chance to fill one of the four non-chartered spots in the field. If there are only four non-chartered drivers qualifying each week it’s a non-issue. However, if you have six or seven drivers coming, not having a charter could now potentially be an issue for you.

The Charter System

The purpose of the system is to help with the cost of running a full-time team in NASCAR. NASCAR is about the money and that money comes from sponsors. If a team can’t find sponsors they will not have the funds needed to run races. One of the issues facing some of the smaller teams in NASCAR was that they were not guaranteed to make the race each weekend and that made finding sponsors difficult.

The charter system guarantees 36 teams a spot in the field each and every race weekend. Below is a quick breakdown of the NASCAR charter system.

Charter System Breakdown:

  • Nine-year agreement between governing body (NASCAR) and Race Team Alliance (Team Owners)
  • 36 charters have been issued to 17 different teams.
  • Each race weekend 36 spots in the field will go to chartered drivers and up to four spots will be available for non-chartered drivers.

The Cash Flow

After the charter system came to be NASCAR stopped posting driver winnings after each event. Before that season NASCAR had been making driver winnings public knowledge for quite some time. According to a recent report by Forbes (the report can be seen in the video below) the breakdown below is what will come of the money in the 2016 NASCAR season.

NASCAR Charter System: Revenue Impact

  • $228 Million – 2016 estimated payment pool
  • $77 Million – in-race purses
  • $68 Million – to chartered teams for historical performance
  • $57 Million – to chartered teams
  • $23 Million – to year-end points fund
  • $3 Million – to non-chartered teams

It’s clear that the charter system is going to benefit those who have charters more than those who do not have charters. Ideally, NASCAR would love for all 36 charters to eventually represent teams that are competitive and have a chance to win each weekend. Obviously that is never going to be the case, but sending a chunk of the cash flow to chartered teams will certainly help some of the smaller operations.

What Is A Charter Worth?

With all of this talk about the charters, the next question has been about what they are worth. Like with most things, a charter is truly worth what somebody is willing to spend on it. Should a charter become available and two teams get into a bidding war over it, it will obviously end up going to the highest bidder.

The charters have not been sold on open market in NASCAR. The above report talks about how MWR charters went for $5 million a piece but that was an agreed upon price prior to the alliance being signed. Currently Forbes estimates charters are worth between $15-17 million. Of course that is impacted directly by the situation at hand. If a smaller team folds and Team Penske wants to buy their charter for Ryan Blaney, they would most likely be able to acquire it for that value.

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However, if the same situation happens and team Penske wants it for Blaney and RFR wants it for a fourth car that they are adding to their stable; the price could be driven up a bit. The bottom line when it comes to the charters is that they are worth every penny in the long run because it provides a great amount of security for a team. It will be interesting to see what happens when a charter hits the open market, something that is sure to happen at some point.