by HAMPTON, Ga. — Less than a week after one of its drivers won the regular-season championship, 23XI Racing has rebuffed NASCAR’s efforts to sign a new charter agreement.
23XI Racing, co-owned by Michael Jordan and Denny Hamlin, said Saturday:
“23XI has decided not to meet NASCAR’s deadline (Friday night) to sign charter agreements for its two cars for 2025-31. 23XI’s position, as stated in a letter to NASCAR, is that we have not had the opportunity to fairly negotiate a new charter agreement.
“We have informed NASCAR of the issues that need to be resolved, in writing, in a timely manner. We look forward to engaging in constructive discussions with NASCAR to resolve these issues and move forward in a manner that will help us reach a fair resolution while strengthening the sport we all love.
“At 23XI Racing, we remain committed to competing at the highest level while maintaining our firm belief that NASCAR must be governed by fair and equitable practices.”
NASCAR had no comment Saturday, a spokesperson told NBC Sports.
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The Athletic reported Front Row Motorsports was the only other Cup team to join 23XI Racing by failing to sign the charter agreement by midnight Friday. The Athletic also reported that teams that did not sign the agreement could lose their existing charters.
RFK Racing co-owner Brad Keselowski confirmed his team has signed the charter agreement.
“We want to operate NASCAR for a long time and we signed the charter agreement, a statement of our commitment to do just that,” Keselowski said Saturday at Atlanta Motor Speedway.
Asked if he felt his team was forced to sign the contract before the deadline, Keselowski said: “I don’t really know where that comes from, but ‘forced’ is a very strong word. But you know, we’re getting to a point where it’s important to get these things sorted out.”
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Hamlin spoke openly Wednesday at Stanley Cup Playoff media day about the current status of the charter agreement. He was more measured in his comments Saturday.
Hamlin said Wednesday: “I’m just trying to make the sport better than it was and continue to grow it, but it’s unfortunate. I would have liked to have been a bigger part of it. Certainly, there have been changes around some of the conversations you’ve had, and I think NASCAR has been very receptive for a while to listening to advice and some of the things.”
“But certainly, in terms of dollars and cents, we’re in two different categories. As a pilot, I’ve spent 20 years doing this and I feel like I’ve done my best to grow my audience on social media, putting out more content. Things like that. I’m trying to keep things fresh, right?
“I tried to build a racing team to build my legacy way beyond just being a race car driver. Being a part of the sport, investing in Jim France (NASCAR chairman), investing in NASCAR. You know, I’m doing my part, but I certainly think from their perspective, they just see me as a thorn in their side and they’d probably be better off without me.”
Hamlin conceded Saturday that it was “frustrating” that most other teams had signed the charter agreement, but said: “Each team does what’s best for them.”
Hamlin said the lack of a lease agreement is slowing future plans. The team plans to sign Bubba Wallace to an extension beyond this season, but no deal has been reached because no lease agreement is officially in place. The team is also expected to expand to three cars next year, but has not announced those plans.
“Everything that happens in the future will certainly depend on things like that,” Hamlin said of the charter agreement.
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The new charter agreement is expected to last as long as the new media rights agreement.
There are 36 charters in the Cup. A charter guarantees a team a starting spot in each of the 36 points races. The charter also provides payouts to teams based on their participation in a race, their performance in a race, their finish in the car owners’ standings and their historical performance based on a team’s finish in the owners’ points over the previous three seasons.
The current charter agreement is set to end after this season. Discussions between the teams and NASCAR have taken place over the past two years. In October 2022, team representatives spoke about a “broken” economic model that needed to be fixed with the new charter contract.
“The sustainability of teams in this sport is not very long term unless we have a fundamental change in the (business) model,” Curtis Polk, an investor in 23XI Racing and longtime Jordan business manager, said in October 2022.
At a Bloomberg-sponsored event in New York on Thursday, NASCAR Chairman Steve Phelps discussed charters and what NASCAR offers teams.
“It really has two purposes: to generate more revenue or provide more revenue to the race teams, which is what we’ve offered to the teams, and then some form of cost containment,” Phelps said. “If you’re able to do that and the teams are cash flow positive, which they should be, collectively, next year with this new agreement, financially, then that continues to generate value for the company.”
“I won’t go into details about current values, but they are dozens of times higher than they were five years ago.”
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Asked about the possibility of making the charters permanent, Phelps said at the event: “There will be no permanent charters. If you look at F1, they have what’s called the Concorde Agreement. It’s a five-year term.
“So we want to make sure that we have the opportunity with our racing teams at the end of this current agreement, or whatever the future agreement is, to make sure that we can assess for all stakeholders what that’s going to look like.
“NASCAR has offered the teams a lot more money in terms of revenue. We have to make sure that all the stakeholders are getting what they need within that. Whether it’s the drivers, whether it’s the tracks, whether it’s the teams. The most important thing – and this is a reality – is we have to make sure that the race teams are healthy. I know there’s a lot of fans that don’t think… they don’t really care about charters, they don’t care about healthy teams, but they should.
“They should do it because it allows them to compete in better races. They are the beneficiaries of profitable teams. We want to work hand-in-hand with our race teams to make sure they are profitable and that the race teams, NASCAR, the tracks and our drivers are all contributing to the growth of the sport collectively.”
