Bolling: NASCAR Secures More Profitable Contract

Are you a NASCAR fan? If so, you have undoubtedly noticed the significant decline in attendance at many NASCAR races: NASCAR Confirms New Seven-Year Cup Series Media Rights Deal (Motorsport).

Consider NASCAR’s recent race in Richmond. At the height of NASCAR’s popularity, the Richmond Raceway seated 110,000, and most races were sold out.

However, in recent years the seating capacity at Richmond has been reduced to 51,000, and while NASCAR no longer releases actual attendance numbers, it is estimated that the Richmond race averages 30,000-40,000 fans these days.

With these significant declines in attendance, many ask … ”How can NASCAR survive?” The answer is … TV revenue!

As the attached article points out, NASCAR recently announced a new seven year, $7.7B TV deal with Fox Sports, Amazon, TNT/Max, and NBC. That’s $1.1B/year, and represents a significant increase over the TV deal NASCAR currently has in place.

NASCAR’s current TV deal with Fox and NBC was effective in 2015 and expires at the end of the 2024 season. It was estimated to be worth $8.2 billion over its 10-year duration, or $820M/year.

So, if you are a NASCAR fan, don’t panic. NASCAR is doing just fine but it is operating on a very different business model than it did back in the “glory days,” a model that relies less on attendance and ticket sales, and more on TV revenue.