A change in ownership in any large corporation, especially an iconic sporting behemoth like IndyCar, is always going to lead to question marks of the future and whether the right decision and due diligence were performed.
Not in this case. Roger Penske, known as ‘The Captain’ for almost half a century and his massively successful company, are exactly the right group to sell the sport to lock, stock and barrel. To both continue the legacy of IndyCar racing and build on the unparalleled success it has achieved since reunifying the sport in 2008.
The Indianapolis Motor Speedway was built in 1909 and is nicknamed ‘The Brickyard’. It is made of, surprise surprise, bricks. 3.2 million of them were used and it was the second circuit ever built after Brooklands in the UK. It remains today the oldest permanent circuit in the world and was originally master-minded by local Indianapolis businessman Carl Fisher.
He then sold IMS to Eddie Rickenbacker who then sold it to the Anton ‘Tony’ Hulman in 1945 for a reported $750,000. So Roger Penske will be only the fourth ever owner of the famous Indianapolis Motor Speedway though no price has been reported thus far.
What is significant and another reason that this is a good deal for everyone connected with the sport, is that Penske is not only buying the Indianapolis Motor Speedway, which hosts the worlds largest one day sporting event, the Indy 500. He is also acquiring the entire NTT IndyCar Series and the highly effective and dedicated TV and Media arm IMS productions. So he really has gone ALL IN and that means the last decade of continued growth for the Series, the Speedway and IMS productions can continue apace into the future.
Why is Roger Penske perhaps the only partner the Hulman Family would even consider selling to is because of his own unique relationship with the Series, the Speedway and the Hulman family.
Penske’s history with Indianapolis Motor Speedway dates to 1951 when he attended the Indianapolis 500 with his father. Since then as a team owner, he has gone on to be the most successful team owner in Indianapolis 500 history with 18 victories, including Simon Pagenaud this year. Penske’s Josef Newgarden won his second IndyCar title in three years this season as well, again for the Captain.
In fact, Team Penske is one of the most successful team’s in the history of professional sports. Cars owned and prepared by Team Penske have produced more than 500 major race wins, over 600 pole positions and 36 Championships across open-wheel, stock car and sports car racing competition.
Over the course of its 53-year history, the team has earned 18 Indianapolis 500 victories, two Daytona 500 Championships, a Formula 1 win, overall victories in both the 24 Hours of Daytona and the 12 Hours of Sebring, and now along with a win in Australia’s legendary Bathurst 1000 race.
Those involved in motorsport in all corners of the world are well aware of the Penske success story in racing. What tips the balance for Penske taking IndyCar in total is that Roger Penske has also achieved huge success outside of motorsport, which is just as impressive if not more so.
The Penske Corporation operates in 3,660 locations worldwide and employs over 64,000 people in retail automotive, truck leasing, transportation logistics. They have consolidated revenues of over $32 billion with Roger’s personal wealth estimated at about 1.6 billion by Forbes.
So not only has the ‘Captain’ lived and breathed IndyCar racing most of his adult life – he’s now in his 80’s – but he is also one of the world’s most successful businessmen. Hence my confidence in his ability to build on what the Hulman’s have achieved since 1945.
The final part of this deal which turns out to be the least obvious, but perhaps the most significant, is that Penske has no intention of rocking the boat of which he is now at the Helm.
At the press conference to announce the deal, Penske announced that he plans to keep the current decision-makers of all three Indy properties in place, – Jay Frye as IndyCar’s president, Doug Boles as IMS’s president and Mark Miles in his current role as Indy Car CEO.
In the same press Conference Mark Miles said of the deal:
“These assets, the property, they’ve been in good shape and they’ve been headed as has Indy Car in the right direction and we want to go farther faster, and Roger is a great leader.
“To have his enormous perspective and look at everything now with fresh eyes and have access and resources to make everything happen at a whole new level, I really believe and am convinced that this will all be great.”
The timing is also good for the Indy/Penske tie-up. Formula One with its new American owners Liberty Media are aggressively marketing in the USA and are looking to get at least two more races in the States to go with the now well established Circuit of the Americas. After a record crowd at the USA GP in Austin last weekend, Liberty Media announced a new three year deal with Broadcaster ESPN and as the owner of SiriusXM radio in the USA, Liberty now has a strong foothold on the American market.
IndyCar may well be a competitor of Formula One in open-wheel racing especially in the US, but Indy is equally in a very strong position for expansion in the future.
IndyCar saw improved television ratings with NBC taking over full broadcast rights in 2019. The Indianapolis 500 race has ridden a surge in attendance with the 100th running, averaging more than 300,000 fans since 2016.
With Penske’s involvement in IndyCar, Nascar, V8 Supercars and IMSA Roger might be able to expand the use of the IMS for more events and globally with new Sponsor NTT, the Series is primed for expansion outside American shores with races in Australia, Asia, and even Europe looking a strong possibility. Add an upward trend in popularity, more eyeballs with on-demand coverage and a crop of young fast and very marketable drivers, Indy is in very good shape.
Plus, compared to Formula One, IndyCar has its act together on all fronts. The racing is good and easy to understand. The cars look good and are safer with every season. The PR and press organization is second to none and therefore drivers teams and sponsors get the exposure they are looking for and frankly, it’s a fun environment to work in That is often a factor not paid a great deal of attention to in golf, tennis or perhaps soccer.
The elephant in the room of course is is this a conflict of interest.
How can Penske, the most successful team in IndyCar. run the entire series without the other teams getting their nose out of joint?
The truth is this is one of those rare cases in Sport where Roger Penske’s ownership is not an issue.
It’s easy to count the 18 Indy 500 victories and the multiple championships including two in the last three years. What perhaps is not as well known is what else Penske is involved, including single-handedly bringing the Belle Isle IndyCar event back from extinction from 2007 to the present day. Since 2007 Penske’s investment in the event has generated $ 47 million a year since its return in 2007.
In addition, Penske organized the Championship Auto Racing Teams (CART) circuit in 1978, owns the Michigan and Nazareth (Pennsylvania) International Speedways, North Carolina Speedway, and California Speedway, as well as coordinating the Belle Isle Grand Prix.
So in many ways the other teams know that the series, which will now be part of the Penske Corporation, is in good hand. With his tentacles in Nascar and Sports Car racing, Penske is in the perfect position to grow the IndyCar franchise.
Already there are rumours of a 24-hour race and even the return of Formula One on the now established Grand Prix circuit at the Speedway.
But perhaps the best illustration of the confidence in this deal is to hear from those very same teams competing against Penske:
ZAK BROWN CEO, McLaren Racing:
“I cannot think of a better owner than Roger Penske and his corporation to ensure the growth and future of INDYCAR. His business acumen and dedication to the sport and passion for the Indianapolis Motor Speedway are second to none. This is a landmark announcement that delivers confidence in a bright future for INDYCAR.”
CHIP GANASSI Owner, Chip Ganassi Racing:
“This is great news for the industry. The news will provide a shot in the arm to both the sport of auto racing and specifically to the IndyCar Series. Roger is a good friend and a class act, and all of his businesses are run well and with integrity. I couldn’t be happier for all of us that are involved with the sport.”
BOBBY RAHAL Co-owner, Rahal Letterman Lanigan Racing:
“Roger Penske’s commitment to the sport we love is over six decades-long, and I am confident that his stewardship of the Indianapolis Motor Speedway and the IndyCar Series will ensure a great future for the sport. His many successful business ventures underline the fact that he is the perfect custodian of one of the most historic venues in the world and is the perfect architect to build the foundation for the next 100-plus years of the sport. We look forward to working with Roger in order to make the IndyCar Series and the Indy 500 the best it’s ever been.”
And then there is the outgoing boss who’s family has steered Indy’s interests since 1945.
Tony George Hulman Group :
“I’m proud of what we’ve done, and we’ve taken it as far as we could take it, but I want to see it get to another level, and you have to change it up. It’s not lost on anyone that Roger is able to get a lot of people to pick up the phone, and he’s committed to his organization working with the management team to make it another jewel in the crown of the Penske Corporation.”
There had been other options and opportunities to pursue new partnerships over the years but the initial idea of Penske stood out as a fulcrum of change, rather than a stop-gap that merely altered the present. Rather than being Plan A, Penske was really the only option. And it’s why the decision came with a unanimous shareholder vote.
“It went from doing our due diligence to making sure we didn’t miss this opportunity with Roger,” George said. “I can’t imagine what this place will look like in five or 10 years. He wakes up every morning, and all he’s thinking about is making his Penske Corporation and his various racing holdings the best they can possibly be, and now we’re one of those.”
As if to cap off a big month for Roger Penske, he was also awarded this week The Presidential Medal of Freedom which is reserved for individuals who have made especially laudable contributions to the security or national interests of the United States, to world peace, or to cultural or other significant public or private endeavors.
So all aboard the ‘Jolly Roger’ as Penske sets sail for Indy’s future.
Considering the choppy waters of television, media rights, and the fight just to keep live sports on TV and eyeballs on mobile devices, there will be big storms ahead for Indy. Then again when your nickname is ‘The Captain’ then perhaps Roger Penske can confidently mouth those famous motorsport words, “I’ve Got This.”
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