Death of car racing?
Toyota is out of Formula One -- one of a long line of car companies abandoning professional racing.
The three major car racing circuits -- Formula One, NASCAR, and Indy Car -- have built a multibillion dollar business. Formula One revenue, including sponsorships and broadcast fees, is estimated at $3.9 billion a year, which is more per event than either the NFL or The Premier League of soccer clubs.
The Toyota retreat can be added to news that the Obama Administration has pressured Chevy and Dodge to pull out of the NASCAR racing series to save $250 million a year. The two companies have been pillars of NASCAR and there are no other auto firms with large enough budgets to replace them.
Revenue at the International Speedway Corp., which operates a large number of race tracks that host major car races, fell to $179 million in the third quarter from $213 million in the prior year period. Operating income dropped from $61 million to $16 million. The company said its outlook for the balance of the year is poor.
The car industry’s global problems will almost certainly mean major cutbacks in professional auto racing. It remains to be seen whether any of the big car companies recommit to the sport in 2010 or 2001. One of more of the circuits could disappear if that does not happen.
Top Stocks writer Douglas A. McIntyre is an editor at 24/7 Wall St.
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