NASCAR President Steve Phelps speaks out about current charter agreement, negotiation process with teams

It took more than two years of negotiation to get it done, but NASCAR and 13 of its 15 Cup Series teams finalized a new charter agreement less than 48 hours before the playoff opener at Atlanta Motor Speedway in September.

The charter agreement is in effect from 2025-31, coinciding with the sport’s $7.7 billion in media rights deals with FOX Sports, NBC, Warner Bros. Discovery and Amazon. Negotiation was tough, and two teams notably did not sign the agreement: 23XI Racing and Front Row Motorsports. The two teams later filed an antitrust lawsuit against NASCAR and CEO Jim France for “unlawful monopolization of premier stock car racing in order to enrich themselves at the expense of the premier stock car racing teams.”

Steve Phelps shares details about negotiation with race teams

Despite 23XI and Front Row’s well-documented issues with the charter system and negotiation process, NASCAR President Steve Phelps believes the sanctioning body “negotiated in good faith,” he recently told Jordan Bianchi of The Athletic.

“I look at two things,” Phelps said. “We got a lot of dialogue and a lot of negotiation with our race teams, and I think there are things in this charter agreement that starts in ’25 that those 32 charters held by 13 teams, that there are things in there they really like and there’s some things in there that they don’t like, or they don’t like as well. And you could say the same thing about our negotiation; there are things about the charter that we really like, and there are some things that we don’t.

“With that said, that’s a negotiation, and that’s exactly what we did: We negotiated in good faith with our race teams to find a balance that was going to help the sport move forward positively. And I think that’s what the charters do. I think the charter system is a good thing for NASCAR and the growth of this sport.”

Teams made demands during negotiation such as making charters permanent, which NASCAR refused to include in its proposals. Under the current model, charters are not permanent franchises like the setup in other professional sporting leagues. Teams can lose their charters due to poor performance on the racetrack or failing to field their cars week in and week out. As a result, most race teams lose money on a yearly basis. Teams argue that by not having permanent charters, it makes it more difficult to attract outside investors and invest in their operations.

Steve Phelps defends NASCAR charter system

23XI co-owner Denny Hamlin has previously described the charter model as “crazy.” But while it may be unpopular with some in the garage, Phelps is adamant it’s not going anywhere.

“I think if you’re going to go from the top of the grid to the back of the grid, this is the most competitive that NASCAR has ever been. It just is. Again, look at the number of winners,” Phelps said. “Look at cars that typically have not been competing. Take a kid like Carson Hocevar, who ran really well at many, many, many races this year, particularly down the stretch. And that’s with a Spire Motorsports team that historically has not performed with top 10s or competing for top fives. That’s just a great success story, and I think that’s what this system allows.

“We’re going to have charters. We are wed to the charter system. And it makes sense because it creates healthy teams. Overall, as we think about 2024 and these 13 teams, we immediately went out and had discussions with every single team about how we’re going to collaborate together. To me, that’s the start of something new and special that I believe is going to work. And when I mean work, I mean it’s going to work for the race teams because it’ll make them more profitable, it’ll help them be more marketable, and because of those things, it’s going to help the sport grow. I’m super bullish on that.

“Again, we’d like all 36 charters to be signed, of course we would. No one likes to be in litigation, but that’s where we are. We’re defending ourselves vigorously.”