Wednesday, September 28, 2011

CLIP: Protecting their turf

Published Monday, November 24, 2003 in NASCAR Scene

By Tom Gillispie

The caution lights are blinking for the State of North Carolina. Surrounding states, particularly Virginia and South Carolina, are trying to lure racing businesses away from North Carolina. And the Tarheel State is resisting.

Ed McLean, the executive director of the North Carolina Motorsports Association, cringes when he thinks of a conference earlier this year. Representatives of England's Motor-sports Industry Association were in North Carolina, and representatives from Virginia were telling the Britons about the wonders of the Old Dominion's racing industry.

"It was the Hampton Roads, Va., coalition, and they were there meeting with these guys from England in Mooresville, N.C., talking about the Hampton Roads area being the motorsports technology center of the universe, at least of the United States.

"I was sitting there, and I said, 'I don't believe this.'"

But the threat goes beyond verbal encroachment: About a dozen counties in South Carolina have joined together and are aggressively marketing that area as a motorsports corridor that could include the construction of a $50 million wind tunnel. Virginia officials are trying to attract racing businesses with an existing wind tunnel in the Hampton Roads area.

In fact, Gov. Mark Warner recently unveiled the public-private Virginia Motorsports Initiative, with the Virginia Department of Business Assistance providing $250,000 in low-interest loans to encourage racing businesses to move to Virginia and to help existing businesses grow. The department also will offer funding for companies that invest at least $100,000 and create at least five new jobs.

The Virginia governor said that the state wants to attract out-of-state mechanics and drivers, as well as encourage technological research. The plan, he added, is to find funds to push expansion of race car research at NASA's Langley Research Center, to support research at Virginia Tech and across the state and to provide funding to train students to work in the motorsports industry.

And now the NCMA and the new Motorsports Caucus in the North Carolina General Assembly have been established to watch out for the interests of motorsports in the Tarheel State.

Richard Petty is the chairman of the NCMA board of directors, which includes Jay Abraham of NASCAR Images, Roger Bear of Keystone Marketing, Chris Browning of North Carolina Speedway, Gene Haskett of Chip Ganassi Racing, Sherry Clifton of Hickory Motor Speedway, Steve Earwood of Rockingham Dragway, John Erickson of Penske Racing South, Jim Hannigan of Petty Enterprises, Thad Lewallen of To The Point Inc., Wendy Morefield of Mooresville Travel and Tourism Authority, Doug StaffordLowe's Motor Speedway and Butch Stevens of BSR Products. of

Racing goes far beyond even the race shops, race tracks, museums, apparel and memorabilia companies, and car parts manufacturers in North Carolina. NASCAR's research and development center has moved to a larger facility near the Concord airport. And several colleges and universities, among them N.C. State, Rowan-Cabarrus Community College and UNC Charlotte, have motorsports curricula.

And that's not even counting the race-weekend business that Lowe's Motor Speedway and North Carolina Speedway (plus even Martinsville SpeedwayDarlington Raceway in South Carolina) bring to North Carolina. in Virginia and

One published figure said that auto racing employs more than 10,000 people and brings an estimated $1.5 billion into the state's economy each year. But the numbers could be much higher, and the first goal of the NCMA, McLean said, is to get funding and do a proper study to discover the exact impact of auto racing on North Carolina. No guesses, no projections, just the facts, ma'am.

The other goal for the NCMA, McLean says, is to raise awareness for the industry in the state capital in Raleigh. That's also the purpose of the state Motorsports Caucus, created this summer and led by Rep. Karen Ray, R-Iredell.

"The State of North Carolina needs to realize that almost all of the race teams are sponsored outside of North Carolina, but the money is spent in North Carolina," says Hannigan, the vice president of licensing for Petty Enterprises. "Sponsorships are $8 million to $12 million, and some are higher, and teams spend the revenue in the state of North Carolina. If you add that up, it's an incredible amount."

Ray has a double interest in the industry. Auto racing is huge in her district, which includes Mooresville. And her family's Mooresville-based business, BSCI Inc., which once made furniture padding, now makes roll-bar padding.

She wants racing to thrive, even if much of her family's business is with teams that do not race stock cars.

On The Bullseye

H.A. "Humpy" Wheeler, the president of Lowe's Motor Speedway near Charlotte, says he wants racing to remain strong in both Carolinas.

"We're going to have to fight in both states to keep our strong presence in racing," he says. "We've seen deterioration in some things. The weekly tracks in North and South Carolina are not as plentiful as they were. If not for Legends cars, the driver count would be significantly lower than it once was in both states. Obviously, Rockingham and Darlington have been hit, and where's it going from there as this [industry] gets bigger and bigger?"

But would race teams really move?

"We believe, just from hearing what's said in our meetings, that that's a possibility," Hannigan says. "There are many states that could lure racing teams and businesses. We're aware it could happen. North Carolina should want to know that, and that's why we raised the issue."

One problem is that North Carolina, once the center of the series, is far from new tracks like Las Vegas or California. Still, Hannigan said he doesn't see teams moving to the Midwest to be closer to those tracks or to Indianapolis, Chicago, Sonoma, Fontana or any track out West.

"Most of the races are still around North Carolina, so, cost-wise, that's not a wise move," he says. "If you could overcome the cost, though, then anywhere is a possibility."

At least one top NASCAR team, though, is making it work. Brendan Gaughan led the Craftsman Truck Series points race most of the season while his family-owned team was based in Las Vegas. Gaughan said often that it was a source of pride for his team to prove it could succeed without being based in North Carolina.

On the other hand, North Carolina, specifically the Charlotte area, retains a huge advantage over other regions, simply because it's where most of the teams at NASCAR's top level are already located. And one more team may be on the way, as Wood Brothers Racing, which has been based in Stuart, Va., since NASCAR's founding, is considering a move to the Moores-ville area.

"We're looking at a lot of options to make our race team better, and moving to the Charlotte area is definitely one of the things we'll have to look at," Eddie Wood, who runs the team with his brother Len and sister Kim, has said. "That's where everything is; all the technology is there."

Haskett, the vice president for Ganassi Racing, and Erickson, the VP for Penske Racing South, say they believe that established teams won't pick up and move out of North Carolina. And it's hard to imagine that the Pettys would leave Level Cross or that Dale Earnhardt Inc. would abandon its Garage Majal in Mooresville.

Those facilities, like Joe Gibbs' impressive complex and those owned by Richard Childress, Roger Penske, Jack Roush, Rick Hendrick and others, are attractions for out-of-state dollars. They would be successful wherever they are.

The likely targets, Haskett and Erickson say, are new businesses. A Detroit, California or Boston businessman who is starting a race team or a racing business might jump at financial incentives or tax breaks and set up shop in Virginia. While Hendrick, Roush or Teresa Earnhardt wouldn't move an existing compound out of state - too costly - a new owner might not hesitate to go elsewhere.

One possibility, says Wheeler, is York County, S.C., just across the border from Charlotte.

"So much of the racing industry got located above Charlotte, primarily because of Lake Norman," Wheeler says. "That's where the drivers and car owners wanted to live. Drivers want to live on water, I don't care whether it's Formula 1 or stock cars. People in racing are attracted to water, and I think it's tranquil. Now, Lake Norman has lost its privacy, so the reason for being in those areas isn't as strong as it once was....

"York County could have gotten a lot of this stuff if they had recognized racing as an industry 20 years ago," Wheeler says. "And there's no reason why they can't [get businesses] now. That still stays in what we call the Charlotte-USA [Uniform Statistical Area]. There's no reason why South Carolina couldn't have its share of places."

Wheeler said that there is precedent for a change of venue for racing.

"If you go back to 1962," he says, "every Indianapolis car was built within 10 miles of the L.A. airport. Everything you needed ... they were all within 10 miles of the airport. They literally lost that in a 10-year period, the whole thing. And that was when Indy cars were far ahead of stock cars in popularity.

"So we've seen industries come and go. You look at the naval yard in Charleston [S.C.]. Nobody ever thought that would leave there.

"So North Carolina, and particularly this area here [around Charlotte] has got to continue to foster and help the motorsports industry. Because, if they don't, it will move out eventually."

Tough times

In recent years, North Carolina has lost thousands of jobs in the furniture and manufacturing sectors. Tobacco farmers in the state have taken a serious hit. And now, the state's status as the capital of stock car racing is under fire. Consider the following:

  • RJR had to back down as sponsor of Winston Cup, and telecommunications giant Nextel, based in northern Virginia, will take over in 2004.
  • The Winston all-star race, run 17 of the last 18 years at Lowe's Motor Speedway, could move at some point. Someone proposes a move each year.
"I don't think they'll move The Winston out of here, because if it's not broke don't fix it," Wheeler says. "The Winston is not an easy event to do. It's probably the toughest event to promote and work behind the scenes.

"You're not going to up and move it somewhere else and get the kind of exposure we get here. It's not as easy as it looks."

But the threat exists.

  • The Winston Cup Preview, held annually at Joel Coliseum in Winston-Salem, N.C., is being moved to Daytona during Speedweeks. It will be known as Fan Fest.
  • North Wilkesboro Speedway was dropped from the schedule in 1996, and the old track in Wilkes County has deteriorated. Still, there have been rumblings about reviving the facility and running short track races there.
  • North Carolina Speed-way at Rockingham lost its fall Winston Cup race on the 2004 schedule, and there's been talk that Lowe's and Darlington Raceway, in nearby South Carolina, might lose races.
But it could get much worse. If North Carolina lost any more races , or if Virginia, South Caro-lina, Tennessee or Geor-gia siphoned a few race teams and some racing businesses across the border, the erosion might turn into a gaping crater.
And all of that would mean lost taxes and jobs in North Carolina.

To the rescue

Wheeler says several factors favor North Carolina.

UNC Charlotte's new motorsports engineering building will be finished in 10 to18 months, he says. NASCAR's R&D facility is in North Carolina. One overlooked factor, he adds, is 600 Racing, owned and operated by Bruton Smith, the chairman of SMI. The Legends and Bandaleros cars, he notes, are built in North Carolina.

"There's a lot of expertise here that's not just directed at Winston Cup or Busch cars," he said.

Ray calls the Motorsports Caucus a unifying force in North Carolina's legislature. Ray, a Republican, is the chairman of the caucus. The vice chairman is Sen. Tony Rand, a Democrat.

She says that she's been encouraged by how N.C. Gov. Mike Easley has pushed the state's motorsports industry.

"When we had our first dinner to study motorsports in Raleigh, we found a heightened awareness of the importance and the vastness of motorsports in North Carolina," she says.

"We in the Motorsports Caucus are committed to strengthening and maintaining and providing a good environment for motorsports in North Carolina."

So beware, Virginia, South Carolina and other states. The caution flag is out, and North Carolina, the leader, is ready to race back to the flag ... and beyond.

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