A pit crew loading a car at the NASCAR Michigan International Speedway, 44th Annual Pure Michigan 400, August 16, 2013.
Correction Appended: October 18, 2013
ESPN is a repository for all kinds of sports--baseball, football and basketball, not to mention billiards, X Games, cheerleading, Frisbee, even soccer. But as of 2015, it will no longer carry NASCAR, perhaps the most God-and-country of all American sports. It wasn't that ESPN lost a bidding war with NBC, which bought the rights earlier this year for $4.4 billion to populate its new sports network. ESPN declined to bid at all, as did Atlanta-based Turner Broadcasting, a 30-year NASCAR partner. What was one of the hottest properties in U.S. sports a decade ago has become a loser for these networks as ratings fade and sponsors flee.
While other sports that took a beating during the recession have mostly rebounded, NASCAR is struggling to get back in gear. Persistent unemployment, a slow wage recovery and high gas prices have thinned raceway crowds like the hair on a 47-year-old--the average age of a stock-car-racing fan. Efforts to prevent horrific crashes that sometimes spray shredded metal into the stands have resulted in safer cars. But that has led to criticism that NASCAR races, which send 900-horsepower machines careening around tracks at 200 m.p.h., are growing monotonous.
As a result, ticket revenues are in their sixth straight year of decline. At the racetracks owned by Charlotte, N.C.--based Speedway Motorsports Inc., which hosts 13 Sprint Cup races, ticket revenue fell from $188 million in 2008 to $116 million last year. The FORTUNE 500 sponsors that once splashed their brands across race cars and tracks, meanwhile, have grown pickier, leaving drivers scrambling for sponsorship money. "We used to fight over dollars," explains top driver Tony Stewart, who became a co-owner of Stewart-Haas Racing in the middle of the downturn. "Now we fight over pennies."
NASCAR is hardly the only iconic American institution left reeling by the lingering economic downturn and demographic shifts. The decline of traditional households, a growing Hispanic population and tightfisted consumers have challenged companies from Walmart to Best Buy. Media and entertainment firms are grappling with millennials, whose buying habits are changing the way everything from condensed soup to romantic comedies get marketed.
In many ways NASCAR finds itself becoming a sports analogue of the Republican Party: solidly popular in red states but with a declining base that skews old, white, Southern--and in NASCAR's case down-market. The question now is whether it's too late to attract the younger, more diverse audience NASCAR needs to grow. "Our business model, which was cruising in a great place, overnight got a real rattle," admits Brian France, the company's chairman and CEO and the grandson of NASCAR co-founder Bill France. "We were trying to figure out what things we should have been doing in the first place."
NASCAR is neither a traditional company nor a sports league. The France Family Group owns the NASCAR circuit, which runs a 36-race season from February to November. (Bill France took the races from the beach at Daytona in the 1950s to organized mayhem at the tracks.) France's sister, Lesa France Kennedy, runs the family-controlled International Speedway Corp., which owns 13 tracks. Independent companies like Speedway--controlled by France-family rival Bruton Smith--operate the others.