By Kurt Badenhausen (Forbes.com, Feb. 17, 2016).
Nascar has undergone big changes over the past decade with how the sport crowns a champion, sells its merchandise and broadcasts its races on TV. The latest overhaul is a “charter” system that transforms 36 Sprint Cup teams into franchises, with similarities to other sports leagues liked shared revenue.
The new system means adjustments to how drivers are paid. Drivers traditionally received a salary, as well as a percentage of the race purse winnings. But purse winnings will no longer be publicly released weekly with charter teams now guaranteed a certain amount of money annually distributed from a fund. There is no need to shed a tear for the leading drivers. Owners are currently reworking driver contracts and are expected to cut deals where the drivers won’t lose money under the new charter system.
There is a huge pay gap in Nascar as is the case in most pro sports. Drivers regularly in the back of the pack might make mid-six figures annually, but the guys up front pull down eight figures. There were 13 Nascar drivers who made more than $10 million in 2015 from salaries, bonuses, personal endorsements and their share of winnings and licensing. They collectively made $198 million by our count.
Nascar has been dominated by four superpowers in Hendrick, Joe Gibbs Racing, Stewart-Haas Racing and Team Penske. They won the past 11 Sprint Cup titles and all but two of the 36 Cup races in 2015. It has become a virtuous cycle with the top drivers all flocking to these four teams and drawing the biggest deals from sponsors who want to end up in Victory Lane. Sponsors pay more to be part of these teams, translating into higher salaries for the drivers.
Our list of Nascar’s highest-paid drivers reflects the power of these four teams. The teams are responsible for all 13 drivers in the sport that make more than $10 million annually. Stewart-Haas’ Kurt Busch is the only driver from the four squads that didn’t earn at least $10 million in 2015.
Rounding out the top five are Kevin Harvick ($15.5 million) and Denny Hamlin ($15.1 million). The total winnings for Harvick’s No. 4 Chevy car were tops at $11.7 million, and his merchandise sales were third highest in the sport last year. The 2014 Sprint Cup champion has a bevy of personal sponsors including: Chevrolet, Budweiser , Bad Boy Buggies, Hunt Brothers Pizza, Morton Buildings, Wiley X sunglasses, Cessna and Greenlee.
Hamlin finished in the top two in seven straight races spanning the 2014-15 Nascar seasons. It was the longest streak since Richard Petty’s 11-race run in 1975. Hamlin added a natural endorsement deal with Denny’s Restaurants in a partnership named “Denny’s Denny’s.” Other Harvick personal sponsors include Coca-Cola, Toyota, Greenbrier resort and Nike’s Jordan brand.
See the complete list at http://www.forbes.com/pictures/mli45ffgld/1-dale-earnhardt-jr/, and read more at http://www.forbes.com/nascar-valuations/.