Three-time Daytona 500 winner Denny Hamlin took the witness stand in Charlotte, North Carolina, on Tuesday, raising alarms about what he described as an unsustainable NASCAR charter arrangement. Hamlin, co-owner of 23XI Racing alongside Basketball Hall of Famer Michael Jordan, stated that the proposed deal would have been like signing his own “death certificate,” intensifying the Denny Hamlin NASCAR charter dispute.
Teams Challenge NASCAR’s Revenue Structure in Antitrust Trial
The federal antitrust lawsuit, launched by 23XI Racing and Front Row Motorsports—which is owned by Bob Jenkins—accuses NASCAR of monopolistic practices that bind teams to what plaintiffs argue is a broken financial model. Hamlin, the first to testify, spent over three hours detailing the extensive costs required just to participate in the NASCAR series, specifying that his team paid more than $700,000 to NASCAR in 2022 for items ranging from entry fees to track access and internet for team members.
Sponsorship Volatility and Financial Risks for Owners
During testimony, Hamlin stressed how precarious profitability remains for modern racing teams, largely contingent on sponsorships. He explained,
“all it takes is one sponsor to go away and all our profit is gone.”
– Denny Hamlin, Team Owner. This reality highlights that, even with significant star power like Michael Jordan’s drawing ability, teams are vulnerable to abrupt financial losses.
Failed Negotiations and the Decision to Go to Court
All 15 charter-holding NASCAR teams publicly pushed for critical changes to the agreement in recent years, arguing the previous contract made survival challenging. After NASCAR’s final offer excluded many of the requested revisions, both 23XI Racing and Front Row Motorsports refused to sign and pursued legal action instead. Plaintiffs’ attorney Jeffery Kessler told jurors that a NASCAR-commissioned study showed an estimated 75% of teams lost money in 2024, underlining the severity of the situation.
Media Shifts and Revenue Divide Deepen the Rift
Hamlin illuminated further pressures caused by the latest media rights deals. He pointed out that NASCAR’s new television contract focuses heavily on streaming, yet premium sponsors prefer the exposure traditional TV offers. Additionally, Hamlin recounted a discussion with NASCAR Chairman Jim France, in which France claimed that fielding a car should cost $10 million, but according to Hamlin, the actual figure is closer to $20 million.
When asked about cost containment and returns on investment, Hamlin stated,
“We cannot cut more. Tell me how to get my investment back? He had no answer,”
– Denny Hamlin, Team Owner.
Charter Agreement Labeled a Breaking Point
Hamlin shared that the last offer from NASCAR contained
“eight points minimum that needed to be changed,”
but teams were told that no further negotiation would occur once they raised their concerns.
“I didn’t sign because I knew this was my death certificate for the future,”
– Denny Hamlin, Team Owner. He elaborated on his commitment to growing the sport:
“I have spent 20 years trying to make this sport grow as a driver and for the last five years as a team owner. 23XI is doing our part. You can’t have someone treat you this unfairly and I knew It wasn’t right. They were wrong and someone needed to be held accountable.”
– Denny Hamlin, Team Owner.
Public vs. Private Messaging and Fear of Retaliation
Under cross-examination, Hamlin responded to questions about why he sometimes appeared more supportive of NASCAR on his podcast. He explained that negative public statements can lead to punitive actions by the league, saying,
“You can take all my things out of context and paint a picture that everything is fine,”
– Denny Hamlin, Team Owner. He added,
“The reality is, (being) negative affects me in (technical inspection), getting called to the hauler, NASCAR not liking what I said.”
– Denny Hamlin, Team Owner.
The Broader Economic Picture and NASCAR’s Position
The trial, expected to last two weeks, also puts the France family’s business operations under scrutiny. The France family, which founded NASCAR in 1948, reportedly received nearly $400 million over three years via the France Family Trust. In 2023, Goldman Sachs valued NASCAR at $5 billion, while pretrial findings revealed the organization made over $100 million in 2024. In stark contrast, Bob Jenkins stated in a deposition that he has lost $60 million over a decade and $100 million since launching his team in 2004.
NASCAR contends that it has not engaged in unfair practices and points out that original charters, created in 2016, were distributed free and are now valued collectively at $1.5 billion. The organization says each chartered car receives $12.5 million in guaranteed annual revenue, up from $9 million previously. However, Hamlin testified that fielding a car for a full season costs roughly $20 million, excluding overhead, salaries, and operating expenses. He also noted that more than half of the original 19 chartered organizations are now out of business, and all three of his team’s charters were acquired from defunct teams.
What Could Happen Next in the NASCAR Charter Showdown?
The outcome of the Denny Hamlin NASCAR charter dispute could fundamentally alter the business framework for teams, sponsors, and the series itself. With the trial underway and powerful names like Jim France, Michael Jordan, and Bob Jenkins in the spotlight, the ongoing legal and financial battles will likely shape the future health and competitiveness of the sport.
