KV Racing Technology owners Jimmy Vasser and Kevin Kalkhoven clearly would like to add a second car in 2010 with Paul Tracy behind the wheel. The problem, of course, is money. Adding Tracy to its roster of drivers would be good for the IndyCar Series. The Canadian veteran is talented, experienced, and candid. Unlike several of the league's drivers, Tracy also happens to be interesting.
Will in absence of Value
GEICO, a subsidiary of Warren Buffet's Berkshire Hathaway, has become a fan of Tracy and the KV team. According to Robin Miller, the auto insurance marketer will provide some sponsorship again in 2010, but only for the races that are broadcast on network television.
The IRL is unlikely to embrace the idea of canceling its Versus contract and incurring a net loss of at least $7.2 million. That's what it would take to move eight races to a network broadcaster and four more to a high-reach cable channel. The increase in promotional inventory capacity to Tracy and KV Racing Technology would be roughly $743,000. Add that to the roughly $1.3 million in existing promotional inventory capacity, and Tracy could expect to have half of the budget required to field a shoestring effort.
Such is the economic reality of IndyCar racing.
Tracy has few options, none of them particularly promising. They include:
- Work with Vasser and Kalkhoven to attract small sponsors that might collectively make-up the $2.0 to $2.7 million gap. This requires tremendous effort and offers a low probability of success.
- Find an idiot who is willing to pay double market value for sponsorship. It's been done before. But marketing is now a spreadsheet-driven, quantitative quasi-science. Finding fools is increasingly difficult.
- Hope that Terry Angstadt can line up a Brazilian widget maker that happens to sell something that GEICO has to buy. Supply chain arbitrage saves the day!
- Pay for the ride out of his own pocket. This is not only expensive, but also degrading. Paul Tracy is an accomplished talent. He has won races and a championship. He is not some kid with either rich parents or a Sugar Daddy Socialist in his corner, and he should not be required to behave like one. Tracy also happens to be a professional racing driver. That implies that he gets paid to drive, and not the other way around.
The 2010 prospects for Tracy and KV Racing Technology are not good. Expect them to run Indy and a few additional races together, much like they did this season. Anything more would require either a minor miracle or compulsory consumption of Brazilian beef at the GEICO employee cafeteria.