NASCAR’s recent decision to present a final, take-it-or-leave-it charter offer to teams just hours before the start of the Cup Series playoffs has sent shockwaves through the sport. On Friday, NASCAR gave teams a 105-page proposal and just six hours to sign the new charter agreement, with two teams—23XI Racing and Front Row Motorsports—refusing to comply. Now, what could have been a celebratory start to the playoffs has instead become a battleground of legal and financial uncertainty.
For years, NASCAR and the teams have been at odds over several issues related to the charter system, which governs the participation and revenue-sharing structure of the sport. The current system, which runs through 2024, allocates a significant portion of NASCAR’s earnings to teams, but those teams argue that they aren’t being fairly compensated for the role they play in driving the sport’s popularity.
In particular, teams like 23XI Racing, owned by Michael Jordan, Curtis Polk, and Denny Hamlin, are unsatisfied with the revenue split, which provides teams around $8.5 million annually—still below the $10 million they initially sought. The teams have also been lobbying for a permanent charter system, which NASCAR has resisted, preferring instead to renew contracts on a rolling basis tied to television deals.
One of the most contentious issues has been the intellectual property rights and how new revenue streams, such as sports betting, are distributed. 23XI Racing, led by Hamlin, has made it clear that their contributions—through star drivers and team investments—deserve greater acknowledgment from NASCAR. As Hamlin put it, “Fans don’t come to see cars go in circles. They come to watch superstars like Chase Elliott, Kyle Larson, and Kyle Busch.”
Despite the negotiations, NASCAR issued an ultimatum to the teams on Friday: sign the deal by midnight, or risk losing charter privileges. Most teams signed the agreement, feeling they had no choice but to accept under duress. An anonymous team owner described the situation as a “gun to our heads,” while RFK Racing co-owner Brad Keselowski expressed a more diplomatic view, saying it was important to get the situation “settled.”
For teams like 23XI Racing, the deal was unacceptable. Curtis Polk called out the contract as being “predatory,” explaining that they couldn’t sign under such conditions. Polk, holding firm, stated that this is “not the 1960s” and such strong-arm tactics wouldn’t stand in today’s business environment.
The future remains uncertain for NASCAR, 23XI, and Front Row Motorsports. NASCAR has threatened to revoke the charters of teams that didn’t sign the agreement, but that could lead to legal battles and even deeper fractures within the sport. Meanwhile, other teams are likely watching closely to see how this standoff unfolds, as any potential changes could impact their future deals.
This conflict could significantly shape the sport’s future. Without teams and their star drivers, NASCAR’s appeal to fans would diminish, yet teams rely on NASCAR’s brand and organizational structure to remain competitive and profitable. How this situation is resolved could set a precedent for the next generation of the sport, for better or for worse.
What’s clear is that NASCAR and its teams are at a crossroads. Both sides must now decide whether they will collaborate for the growth of the sport or continue down a path of division and uncertainty. If a resolution isn’t found soon, it’s not just the 2024 season that could be in jeopardy—it’s the entire future of NASCAR.
