Auto racing is a business, and it’s not like any other business on this planet. Auto racing is also a small business, and therefore it’s getting tougher and tougher every year. No, not the competition, it’s always tough, but rather staying in business, making a profit, and continuing your work. Racing cars isn’t easy, it isn’t cheap, and there are fewer sponsors these days in the marketplace. Much of that has to do with the economy, and the challenges of an economic recession, yes, things are starting to pick up, but it just can’t happen fast enough it seems.
Nevertheless, things are what they are, and in the unpredictable realm of auto racing, this is just one more thing to deal with. Call it headwinds if you will, definitely economic headwinds. There was an interesting article the other day in the Wall Street Journal by Chris Maher on June 18, 2011. The title of the article was “Gas Prices Driving a Shift-Small Businesses Adapt by Tacking on Surcharges or by Making Cuts Elsewhere” and after reading this article I realized that many small businesses which use a lot of fuel are having a heck of a time making a decent profit with gasoline prices at over four dollars a gallon, while oil hovering around ninety to a hundred dollars per barrel.
In my younger days, I franchised portable carwash trucks, and mobile detailing units which went to homes, offices, and fleets to clean vehicles. When I was running my business, gasoline went from $.75 a gallon to a $1.35 and now it is up at four dollars per gallon. I remember it used to cost us almost $10-15 per day to run our trucks, and some days $20. And remember that was back when fuel was only at $1.35. Today, running that same business would have our fuel costs at between 60 and $75 a day. That’s a huge hit on the expense side of your operations.
Now then, if you want to win in auto racing, your driver needs to constantly be practicing. When the price of fuel goes up, the price of specialty fuels skyrocket. The same is true for aviation fuel, and fuel in the boating industry or marine sector. Running an auto racing business in this present climate is tough enough trying to get sponsors, imagine trying to deal with the fuel costs? No wonder racing simulators have become so popular for training NASCAR drivers these days.
If you are into racing, or perhaps a race fan and you know more about this topic, I’d like you to shoot me an e-mail, because it was a subject of discussion recently at our think tank. So please consider all this and think on it.