NASCAR teams are very distinct and intertwined organizations with many moving parts that allow all the drivers to compete at the highest level. While some may believe that all that is required is to pay the team fee, there are many intricate pieces to a successful team that many people do not seem to realize.
The total outlay for owning a NASCAR team is upwards of $500,000 per week, which equates to more than $15-20 million in annual expenses over the 38-week season. Owning a NASCAR team is a significant financial investment. Expenses include salaries, cars, transport which, in the short term at least, are likely to rise.
Along with paying for parts, you usually must pay for your team’s expenses for attending race events and traveling across the country to compete. This can include hotel rooms, meals, and event tickets. Consider bringing your entire team to multiple cities across the country, sometimes multiple times per month.
How Much Does A One-Car NASCAR Team Cost?
Let’s get started with the tools. The main issue with the equipment is that it is used at such a high level and for such a powerful vehicle in NASCAR that it usually does not last very long.
As a result, tires, brakes, and fuel are typically purchased more frequently due to the need for the equipment during race season. Some racing teams believe they will use more than 90 different sets of tires throughout the season! That is a significant amount of money spent on tires, estimated to cost around $45,000.
Then there’s the biggest cost of all: the car itself. The performance of a NASCAR vehicle can make or break a driver’s season. The cars are critical to a driver’s chances of success.
Many of the people employed in a NASCAR team are specifically there to assist with any issues with the car and improve performance. A NASCAR racecar that will permit a team to compete at the very highest level with very few to no problems at all could cost a team anywhere between $125,000 and $150,000.
Although this is the estimated cost for one car, imagine having a variety of vehicles throughout the season. One crash, one failure, or one fire, and that car is rendered completely unusable in a competitive setting, necessitating the team’s efforts to prepare another car in time for the next race.
It all comes down to the reality that NASCAR teams are incredibly expensive because, due to the short lifespan of the cars in the sport, teams must always be on duty since they are critical to the sport’s success.
NASCAR Race Car Expenses
Then there’s the biggest outlay of all: the car itself. The performance of a NASCAR vehicle can drastically affect a driver’s season. The cars are crucial to a driver’s probability of victory, and many of the people who work on a NASCAR team are specifically there to assist with any car issues and to improve its performance.
A NASCAR Cup Series vehicle capable of competing at the highest level with little to no issues is expected to cost a team between $200,000 and $400,000+. BK Racing, for example, paid more than $18.1 million to compete in the 2016 season, despite having two full-time cars and one car that appeared in only nine races.
Breakdown Costs For A NASCAR
While the prices differ from team to team, these are very close estimates for a “normal” 2-car Nextel Cup squad.
- Cars – $400,000+ each
- Salaries for the teams – $3 million/year
- Drivers – $400,000 for a rookie up to several million for a top ten driver
- Travel – $1 million/year for each team
- Tires – At least $30,000 per race
- Engines – $100,000 each
If you believe these charges are excessive, consider that the costs for larger, more popular teams can be doubled or even tripled. With such excessive costs, NASCAR owners needed to find a means to pay the bills– in other words, they needed someone to subsidize their teams.
Employee Expenses In A NASCAR Team
Employee costs are incredibly high, as they are with anything that necessitates the use of humans. Owning a NASCAR team necessitates a large number of employees because you require a large number of experts in a variety of fields.
Employee wages accounted for approximately 27.5 percent of BK Racing’s annual expenses, whether hourly workers, contract payroll, or driver payroll before they were sold to make front row racing.
The employees must then be provided with the necessary equipment to wear during races, such as fire suits, which cost approximately $400,000 in total, and those suits must be dry cleaned, which costs roughly $2,400 per race.
Each of these expenses continues to add up, and it is to be expected that employee expenses will be a significant portion of the costs that NASCAR team owners must pay.
Additional Expenses Associated With A NASCAR Team
Added expenses for the NASCAR team owner are frequently overlooked, but this does not imply that they are insignificant sums of money or that such costs are unimportant.
Additional costs can include but are not limited to travel expenditure, hotel fees, car transportation expenses, and much more. These expenses can add up to around $125,000, which may seem like a lot less than some of the other costs associated with owning a NASCAR team, but it is still a lot of money.
Every five years, another $400,000 can be added to that $125,000 because the NASCAR team’s owner must replace the haulers that transport the cars to the proper racetrack. This merely adds more money to the cost of owning and running a NASCAR team.
How To Profit In NASCAR
Through advertising, NASCAR teams have frequently been able to make the most money and truly earn profits. Although the prize money is substantial, advertising is the most effective way to profit from a NASCAR team, particularly for the best teams.
Even so, in trying to obtain the best advertising, your NASCAR team must be successful enough for advertisers to want to sponsor your team. BK racing, for example, was not extremely successful, only placing 31.1 out of 40 cars on average.
As a result, they did not have many sponsors, so their prize money accounted for approximately 79 percent of their total income. The more successful the NASCAR team, like any other business, the more money the owner will make from prize money and sponsorships.
Why Are NASCAR Cars More Expensive Than Regular Cars?
Unlike regular cars, NASCAR cars are expected to be high-performance vehicles that stress every race vehicle component. In order to be able to race the car safely, advanced engineering must be used, allowing the car’s components to be safe enough to handle the extreme speeds that a NASCAR car is expected to reach.
Natural wear and tear on NASCAR cars occur exceptionally quickly, with it often only taking one race to render the car undriveable again, so replacing the car only adds to those costs.
The costs to run a team in NASCAR are exorbitantly expensive. Your top teams (Joe Gibbs Racing, Hendrick Motorsports, and Penske Racing) spend upwards of $15 million per year. Then there’s the middle tier, which spends between $10–15Million+ per year. Then there’s the bottom tier and teams that (which spends $4-$9Million+ per year.