Michael Jordan's 23XI Racing among two holdouts on NASCAR new charter deal
HAMPTON, Ga. — Co-owned by basketball icon Michael Jordan and NASCAR driver Denny Hamlin, 23XI Racing is one of two NASCAR Cup Series organizations that did not sign NASCAR's proposed charter agreement that most owners signed Friday night.
Front Row Motorsports, owned by restaurant operator Bob Jenkins, also has not signed.
The teams and NASCAR have been negotiating for two years, and, according to industry sources, teams were told Friday night that if they didn't sign the latest proposal that night, they could risk losing their charters for 2025.
Curtis Polk, who has an interest in 23XI and has been Michael Jordan’s long-time business manager, spoke to reporters from FOX Sports, The Athletic and The Associated Press in the Atlanta Motor Speedway garage on Sunday afternoon.
"NASCAR has consistently refused to deal with 23XI in these negotiations," Polk said. "We are David facing Goliath, NASCAR has superior bargaining power and undue influence over the sport and the charter process.
"They wielded this power continuously over the past few months and consistently rejecting broad team requests on major issues while providing minor changes for pet issues that some teams requested in 1-on-1 meetings."
NASCAR President Steve Phelps declined comment Sunday afternoon. Front Row Motorsports owner Bob Jenkins also declined comment.
Polk said the proposed agreement took away "essential rights" but would not go into the specifics of the team's requests it sent to NASCAR in a letter sent last week.
"We understand that some teams may have felt pressured and compelled to sign the agreement under significant duress," Polk said. "While other teams may have signed the charter agreement, 23XI Racing faces our own challenges that make these terms particularly harmful to our operations and our ownership groups, interests and intellectual property rights.
"This isn't the 1960s and these predatory practices will not withstand scrutiny and be accepted in 2024."
What happens if they don't sign isn't totally clear, whether NASCAR would take the charters and sell them or hold them to see if those teams sign. Both 23XI and Front Row each have two charters currently with both expecting to obtain one of Stewart-Haas Racing charters after this season.
Former Cup champion Brad Keselowski, who drives for and co-owns RFK Racing, indicated that he wouldn't characterize it as the teams were forced to sign the deal.
"For us, we felt like it was right to do a deal and move forward," Keselowski said during his required at-track media availability session Saturday at Atlanta Motor Speedway. "I don't necessarily know where [an ultimatum] is coming from. ‘Forced' is a really strong term.
"But we are getting to a spot where it's important to get these things settled."
Hamlin referred most questions Saturday to the 23XI Racing statement.
"I don't really have anything else for you," Hamlin said. "I wish I could or would, but not today."
Hamlin said 23XI Racing could field teams without a charter but it would be tough economically. Polk also was unsure what 23XI would do if it doesn't come to an agreement with NASCAR.
"We have the resources that if we want to race, we'll race," Polk said.
NASCAR officials would not confirm that all but two teams have signed the new agreement. Several owners confirmed to FOX Sports that they signed but declined comment.
"We're not trying to do something that benefits 23XI to the detriment of the sanctioning body, the [NASCAR-owning] France family, or any of the other teams, the drivers, the fans," Polk said. "We wanted to do something that would help everybody. … We think that the contract that was presented to sign had terms that we could not sign.
"It is a very one-sided contract that is going way backwards from the charter that we've currently been operating under, and we just cannot sign something and do business in an environment where one side has so much power over the other side."
Teams have argued they deserve a bigger percentage of the television rights deal, a reported $1.1 billion per year deal announced in November 2023 that runs from 2025-2031 with FOX, NBC, Amazon, Warner Bros. and TNT Sports (and CW for the Xfinity Series). Under the previous deal, teams were paid 25 percent of the television revenue through the race purse, while NASCAR took 10 percent and the tracks (more than half the tracks are owned by NASCAR) getting 65 percent.
Sources have indicated teams are getting a greater portion of that money as part of the new deal (about 35-40 percent) but also gave up rights in other areas that could generate revenue, such as ancillary media rights, driver appearance requirements and a cut of the charter sales.
"We're glad that the economics are improved to go with the media landscape that moved," Keselowski said. "Right now, the sport moves around the media rights deal."
The teams also wanted permanent charters but NASCAR executives scoffed at that request. The new agreement aligns with the current television agreement through 2031.
Polk wouldn't go into specifics and said he wouldn't negotiate the terms in public. He said he last met with NASCAR Chairman Jim France in May at 23XI Racing's meeting with NASCAR executives.
"This is a business, and we're not going to be coerced into signing something that we're not comfortable signing," Polk said.
Will there be a lawsuit?
"I'm not going to speculate as to what we're going to do," Polk said. "We're going to protect our rights, and whatever we have to do to protect our rights is what we'll do."
A charter is NASCAR's version of a franchise, but it doesn't give team owners as much say in the direction of the sport. It guarantees a starting spot in the field every week and a guaranteed payout based on racing each week as well as past years' performance and championships won. It also lists the payouts for each position in a race so teams can estimate income to help secure investors or loans.
There are 36 charters and those who attempt to compete without a charter – typically called "open" cars – earn less than a third of what a charter team makes for coming to a race. With the current Cup race field a maximum of 40 cars, there currently are four spots available each week for open cars to attempt to qualify for the race.
The structure leaves the teams, who have contracts with drivers and sponsors to compete, seeing their business model significantly change if they do not have a charter to be even more reliant on sponsorship, which is more than half the revenue (and sometimes closer to 70 percent of the revenue) to some NASCAR teams.
"There's a lot of comparisons between NASCAR and the other sports leagues," Keselowski said. "This industry is looking over its shoulder at the NFL, NBA and so forth and seeing their situation dramatically improve, and we all want the same.'
Bubba Wallace, who drives for 23XI Racing, indicated that the charter negotiations have impacted his ability to sign for 2025.
"That's what we're waiting on," Wallace said Saturday morning at Atlanta Motor Speedway.
Wallace is expected to return to 23XI, and Hamlin acknowledged the impact of the uncertainty of the charter agreement.
"Anything in the future is dependent on things like that [charter agreement]," Hamlin said.
Bob Pockrass covers NASCAR for FOX Sports. He has spent decades covering motorsports, including over 30 Daytona 500s, with stints at ESPN, Sporting News, NASCAR Scene magazine and The (Daytona Beach) News-Journal. Follow him on Twitter @bobpockrass.
