INDIANAPOLIS – On Monday, the motorsports world was turned upside down. The Indianapolis Motor Speedway, which has been under the Hulman George reign since 1945 was sold. Not only was IMS sold, so what everything that they owned, including the NTT IndyCar Series.
I get that everyone would have a ton of questions regarding Monday’s announcement. I know I for sure did. Following the press conference, the vision is clearer. Let’s try to answer what’s going on.
Why Sell? Why Now?
I spoke to Tony George and wondered, why on Earth would the family let the Indianapolis Motor Speedway go? This has been in their possession for decades. Now, they’re selling.
Some speculated on if it was money. I didn’t get the vibe that it was monetary related though. I got the vibe that it had more to do that with Mary’s passing last November, that the family had a heart to heart after that and wanted to know how much longer that they wanted to hold onto this. Then, with the Clabber Girl sell this past Spring, it got the family talking again about unloading everything else.
Is this something that they want to leave behind for future generations? Is anyone even interested past this generation now in running it? They had to make a decision before it was too late.
For the first time in a long time, IndyCar and IMS were on a rise. When Mark Miles took over in the offseason between 2011 and 2012, IndyCar was still really low in every metric. But, 2012 gained over 2011. 2013 gained over 2012. 2014 gained over 2013 and so on.
Throw in the Indy 500 gaining again each year too, and you get a series and race that’s nearing it’s rightful place on top of the racing world. For years, IMS/IndyCar operated in the red. Under Miles’ and Boles’ watches, they got in the black. With Mary now gone and now future plans in sight for future leadership for the Hulman/George family, why not explore selling?
“There was outreach,” Tony George told me on Monday regarding why sell. “So we, as a matter of course, we pursed that. Now, I just think as much as anything, it was conversations that we had as a family and the trustees of the family trust that were looking at the future generations that aren’t even here yet. Some people refer to us as generation 2, 3, 4 even though we’re at 6 and 7 in fact.”
So, why not though?
“Because there’s no time like the present,” George continued. “We had just gotten to that point. We had been looking at the strategist opportunities and options over the last 10 years on a regular basis. We look at it every couple of years. This time, they took a turn more towards selling.
“Back in April, we announced and closed on the Clabber Girl transaction in the spring time and that’s really what kind of sparked these conversations. It came down to we had to do our diligence and purse the opportunity.”
So They Want To Sell, But To Whom?
George said that the top person that they had in mind was Roger Penske. He was successful in everything he’s ever touched. He came to the top of their list.
“I can’t imagine what this place is going to look like 5, more like 10 years down the road,” George said of Penske taking over IMS. “One thing about it, he (Roger Penske) wakes up early in the morning and is all about making his Penske Corporation and their Penske holdings the best that they can possibly be. We’re now going to be one of those.”
Did Penske Seek Them Out?
No in fact. Penske didn’t even know IMS was even thinking about selling. George, sought Penske out on the grid during the IndyCar season finale at Laguna Seca and approached him about the idea of buying them out. But, George also knew that Penske had two cars in a fight for the 2019 championship too, so he didn’t want to interfere. On Monday, George followed back up with Penske and the rest is history.
“We’re very excited to be in a place where our process took us to a point where we as a family all agreed we needed to have a conversation with Roger Penske,” George said in his opening statement on Monday. “I approached him at the final race of the season, not wanting to distract from the task at hand, which was bringing home another championship, but I wanted to wish him well on the grid, and I just simply said, I’d like to meet with him and talk about stewardship.
“He got a very serious look on his face and followed up after he clinched his championship with an email and then another email the next morning, and we set it up. I invited Mark (Miles) to join us for that meeting, and kudos to both organizations who worked very closely together very quickly. It was a pretty easy — not easy by any means, but this isn’t their first rodeo, your first rodeo, your first rodeo. So they were able to execute around diligence very quickly, and it led to an announcement that miraculously — not many things are kept under wraps around here, but this was fairly well contained, and we were able to really, I think, present this to the world this morning.”
What About IMS/IndyCar Made Penske Interested?
“Well, let’s look at TV ratings are up, attendance is up, social media is up,” said Penske of that question. “We’ve got NBC as our partner, not only the network but also on cable. It couldn’t be better. The competition, you know it yourself, coming down to three or four drivers being able to win the championship at the last race. I think the racing product is excellent, and the fact that we have short ovals, big ovals, the Indy 500, then you have street courses and permanent road courses, I think the venues are well-balanced.
“Look, it would be great to have another venue here in the U.S. this is a North American sport, including obviously Canada. I think what we have to do is be sure that we can get people that want to invest in the series with us, and to me, the product is good, I think the officiating, Jay Frye, Kyle Novak, certainly Arie Luyendyk and Max Papis from the stewards, that process is the best it’s been.
“I think what we have to do is maintain our data equity and through social media and getting the sponsorships, I think when we sit down with the team owners and give them a chance, and we be very transparent with them and we’ll let them see how they think we can add to this sport because this has got to be done not just by us, it’s got to be done as a team effort, and to me, you can’t walk in here today and make an announcement like this. We’ve been wide open here for the last six weeks to try to get to this finish line, and I think now what I want to step back with our team and with Mark’s team and be able to look at the things that they see because they’ve been much closer to it than I am.
“I can tell you what the garage area looks like and what pit one or pit two looks like. I like being in the winner’s circle, I do know what that looks like. That I do know. But I can’t tell you that — we’ll have, I think, as I say, a top 10 by the time we hopefully get to the closing at the end of the year.”
Isn’t Penske Busy Enough Already? He Will No Longer Be On The Pit Box In IndyCar Now
Yes, he is. Penske owns multiple companies to go along with two IMSA teams, three NASCAR Cup Series teams, one full time NASCAR XFINITY Series team and three IndyCar teams. On top of that, Penske has been on top of the pit box in IndyCar calling races. That will now come to an end.
“I’m planning to really step down from being a strategist on the pit box,” said Penske. “You won’t see me there on race day. I think I’ve got a bigger job to do now, is to try to see how we can build the series to the next level. It will be nice to bring another car manufacturer in. I know Jay Frye is working on that; can we have someone else come in to join the series.”
Isn’t An IndyCar Team Owner, Owning The Series A Conflict Of Interest?
One of the more confusing parts of Monday’s announcement is that an existing IndyCar team, one that’s won a record setting amount of Indy 500’s and Indy 500 poles, to go along with three series championships in the last four years is now running the series as a whole.
Isn’t that a conflict of interest? Wouldn’t the other teams be mad? I mean, imagine the outrage if Robert Kraft owned the New England Patriots as well as the NFL.
Penske, will be doing that in IndyCar.
“Well, I think as you look at the construct as we go forward, the sanctioning body and (NTT IndyCar Series) will be a separate company, and the other assets will be in the speedway,” Penske said of the potential conflict.
“I think with the proper board — I think you have to ask our competitors at this point. Tony has been a car owner and we were talking about it today. I think Tony has said all along, Wilbur Shaw or Eddie Rickenbacker have been drivers, so there’s been some history, but I don’t want to leave this conversation without knowing that I understand the integrity, and there’s got to be a bright line, and to me I know what my job is, and hopefully I’ve got enough credibility with everyone that we can be sure that there is not a conflict, and I’ll do my very best to be sure that isn’t. If you think it is, I hope that — I know that you folks will tell me pretty quick. So I’ve got a lot of guys watching me.”
So far, the news was met with high regard in the IndyCar paddock. Most of the teams put out statements that they’re behind Penske and this direction. Lets hope that lasts.
Will Mark Miles And Doug Boles Remain In Place?
Now that Penske is running the show, what happens to the people already in place? Will Mark Miles still be the CEO of IndyCar? Will Doug Boles remain as the President of IMS?
Penske doesn’t want to change any of that.
“This business is not broken,” Penske said. “This is a great business, and the leadership team that’s been here has done an outstanding job, and what we want to do is be a support tool.”
Penske later confirmed that none of the leadership positions are being changed.
“We have no intention of changing the management teams that are place today, and certainly we’ll have a board that we’ll announce at the time of the final closing of the transaction, and we hope to have a diverse group of people on there that know the business and can support the business, take us to the next step. That’s going to be part of our plan.
“And we also, just to put it in perspective, we’ve offered the Hulman family members if they’d like to have an interest in the company that we would look at that during between now and when we get to the end of the closing.”
Guaranteed Indy 500 Entries For Full Time Teams?
Another potential conflict is Penske’s stance on guaranteed entries into the Indy 500. In 2018 and again in 2019, we had more cars show up to Indianapolis in May that starting spots available. Bumping would return.
See, bumping is a huge allure to qualifying weekend. It adds prestige and drama. The thrill of making the race is huge, so is the agony of not.
But, with the monetary side of things being low still in sports in general, would it make sense to have a full time entry and a big named driver bumped and not make the show? How would that affect ratings? How would it affect that team showing up next year? Missing the Indy 500 is a huge loss in terms of revenue.
Penske knows first hand. He missed the race all together in 1995. He wasn’t back in 1996. James Hinchcliffe was bumped in 2018 but luckily was back in 2019. Is the risk of a full time team missing the show playing with fire.
Penske thinks so. But, now with him in charge, will he ensure full time teams make the race?
“Well, that’s been a discussion before, and I think that that will be a strategic discussion that will be taken up with the senior leadership here. I wouldn’t make a comment today one way or the other. I think it’s really up to Mark (Miles) and Jay (Frye) and the team to make that decision. I think some of the excitement has been in the past the fact that we had people that wanted to come into the race. We also have to understand people who commit to the entire season and take this series around the country, around the world potentially, we need to be sure they’re taken care of.
“I think it’s a debate, but at this point, I wouldn’t comment one way or the other.”
Will Changes Be Made To The Track? Penske Hints Possible Lights, 24 Hour Race, F1 Return, Etc
Penske isn’t shy on making changes. While he doesn’t know what they will be yet, everything is on the table.
“Well, I think what I plan to do tomorrow, ironically, is to walk the entire facility and strategically sit down with the existing team and get their top 10,” Penske continued. “I always like to work from a top 10 and see the things that we can do to make it fan-friendly, certainly from a competitive perspective.
“I think we look at the speedway itself, the investment with the 100 million dollars that was put in a few years ago before the hundredth, I think you’ve seen a tremendous change, and we want to add capability as there are more fan zones, what can we use this for, can we run a 24-hour race here, can we run a Formula 1 race here. What are the things we can do? This is a great asset. Once the tradition had been broken in adding the NASCAR race, which obviously we’re going to get behind that in a big way because for 27 years they’ve run here. So I look at all of these across the board to see what can we do.”
Will The Brickyard Go Away? Nope!
Most people think that the Brickyard is a failure. The attendance is low and the race is less than desirable. But, what if I told you that the Brickyard makes as much money as the Indy 500? The TV contract helps that.
Now, with Penske at the helm, will he ax the ‘400 all together?
“Well, I think you look at 27 years, there’s no reason to break that string of races,” Penske said of the Brickyard. “I had a chance to talk to Jim France (Head of NASCAR) late last night to tell him that we were going to have this conference here in the morning, and he obviously was excited. We’ve worked together. We were partners with ISC at Homestead. We actually sold our business to them back several years ago. So we have a very close relationship and certainly with Jim and with Steve Phelps and Steve O’Donnell and the entire France family. We would expect to take this for many, many years.
“They need to run at Indiana. We want them to, and there’s no question that we’re going to look at opportunities to expand the relationship with them in the future.”
Will IMS Host An IndyCar/NASCAR Doubleheader?
One of the big things in motorsports now is a possible IndyCar/NASCAR doubleheader weekend. Unfortunately, it’s been a lot of talk but no real action. Penske, is going to take that action. Will IMS be a place to host it?
Penske now owns it as well as IndyCar. He has teams in IndyCar as well as NASCAR. IMS makes the most sense to run a doubleheader at and according to Penske, could be the front runner.
“Well, I think it was interesting to see (Josef) Newgarden run around what they call the Roval here down in Charlotte several weeks ago, and I think it was pretty exciting,” said Penske of the possible shared NASCAR/IndyCar weekend. “I think some of the fans had never seen an Indy car on an oval or a racetrack. Look, those are things, sitting down Tony will give us some of his input and certainly Mark and the team, are those things we can do, can we execute those so we bring value here to the speedway.
“Look, we’ve got to break some glass on some of these things, don’t we. We’ve got to try some of this. I’m prepared to take a risk. No risk, no reward in many cases. Those are the things that Mark, with you and your team, that we’ll take a look at. But I wouldn’t say it’s out of the possibility.”
What Can We Expect for 2020 Indy 500?
“Well, that’s an all-encompassing question,” Penske said. “Number one, I want to be sure that we’re as good as we’ve been, and I’m going to count on this team here. Remember, I’m going to be the new guy in town, so we’re going to take those plans and see if we can add anything to it that makes it better. But I don’t think you build a business overnight. This didn’t get to 300,000 in three or four years, so we have to be rational on our investment.
“But we’re interested in economic development in the community, the Hoosiers that support this all over the state want to see this become and still be the iconic race of the world. So we’re going to do this a step at a time, and I think that we’ve got here probably the next 60 days we’re hoping to close this very early January based on all the regulatory things we go through, and I think at that time we’ll have a had a chance to talk to all the leadership here and get some good input because this is obviously a chance for us just to add our support and our shoulder to make this better.”
Will Hulman George Family Invest More In Ed Carpenter’s Team?
Tony George doesn’t think so. Remember, Ed Carpenter is the step son of Tony George. In fact, what George does think is that Carpenter and Penske may work closer together.
“No, I mean we’ve been an Ilmor team since Ed’s formed the team,” said George as Penske owns Ilmor. “We’re a Chevy team because of Roger (Penske). Our options were Lotus and I advised Ed that he and his sponsors as much as they wanted to do it that they should save those resources. It worked out for Ed.
“Derrick Walker was our general manager at that time so there were already connections to Roger. I placed a call, Derrick placed calls and at the end of the day, I think Ed’s been a good partner for Chevy and Ilmor. I don’t think we’re getting anything or expecting anything different. We try to earn our place.
“For Ed, I thought more about when he hangs up his helmet what’s he going to do next, but he wants to keep running his team. Obviously, we’ve got to make that our No. 1 priority. Beyond that, I think Ed has a broad base of knowledge of this industry that few others have. I think Roger respects that. We’ll see if their relationship develops more than it has so far.”
On favorite IMS racing memory
“That was special (of F1). My favorite memory is the start of every race. I get excited and anxious. The hairs on the back of my neck stand up just like everbody. I got that once with Formula One. It didn’t happen the second time. I get it every year on Memorial Day Sunday.