NASCAR Charter System: JGR President Explains How It Protects Teams and Drivers

The NASCAR Charter system has been in effect since the 2016 season and has become an integral part of the business of team ownership. But what is this system exactly? Speaking in a recent video, Joe Gibbs Racing President, Dave Alpern, elaborated on the concept, explaining how the system protected the teams and the drivers throughout the season.

He explained that the charter system was similar to how other professional sports had a franchise system. “There are 36 charters. Teams are investing in facilities. People paying the drivers that you love to watch every week. A charter guarantees that those 36 teams that are making those investments are guaranteed a spot in every race, every week and the purse is distributed among those 36,” 

He added, “There’s also a smaller pool for an additional four spots every week that are called open spots. But the charter system provides some security for teams who are making these investments again in facilities and people to be guaranteed to show up every week and compete.”

NASCAR teams aren’t happy with the existing charter deal

There has been quite some debate and negotiations regarding the charter deal. However, the main reason why the teams seem to be fighting toward bringing in changes in the charter agreement is the monetary distribution each charter receives from NASCAR. At the moment, the money that they receive is simply not enough for a team to sustain their operations each season.

According to the Sports Business Journal, the approximate cost of running a single charter in the sport was valued at $20 million and above. The teams were upset with the promotion since the current charter deal requires them to receive 60-80 percent of their budget from corporate sponsorships. This creates a high sponsorship-reliant impractical financial distribution for the teams.

However, with the 2025 charter agreement in sight, the teams hope that they will be able to negotiate a better deal for themselves that allows them to function with a more profitable financial margin. Although, as of now negotiations seem to have reached an impasse and some experts believe that a thorough conclusion is still several months away from fruition.