IndyCar: Indy Idea Dials up the Wicker

Let's continue examining criticism of the Indy Idea, courtesy of the Wicker Bill blog.

"The author claims that the attendance estimate for Edmonton (a strong
60,000 on race day) is equivalent to the estimates for Kansas, Kentucky and
Chicagoland." - The Wicker Bill

Constructive debate becomes impossible when the counterparty engages in gross mischaracterizations. Let's review what I actually wrote.

"Attendance at IndyCar oval races at Kansas, Kentucky and Chicagoland was
undeniably awful in 2009." - Roggespierre

Any assertion that attendance at these races was equal to that of Edmonton, St. Pete and Mid-Ohio would obviously be inacurrate. That is why I wrote nothing of the sort.

I did in fact write that attendance at these events was approximately 60,000 back when the IndyCar Series was a predominantly oval racing product. It is now a predominantly road racing product. Its roster of drivers includes exactly one full-time entry that is driven by an oval racer, and he happens to be the founder's stepson. That is not much of a value proposition for U.S. spectators, a vast majority of whom has demonstrated that it prefers oval racing products.

I also articulated my moral abhorrence of publicly subsidized racing events. Edmonton drew 60,000 spectators. That in itself is very good. However, the Edmonton event requires direct public subsidies from the local, provincial and, this year, national governments. IndyCar racing, much as we might like it, is not a public good.

Permanent racing facilities, from Road America to Michigan International Speedway, are bastions of excess capacity. If IndyCar were to present a marketable product, then it might race at some of these facilities. Moreover, unlike publicly financed athletic stadiums, temporary circuits offer no residual value once the event is complete. It can't be used by conventioneers. Everything goes back to the warehouse until next year, when the whole thing is subsidized once again.

"This is called supporting evidence, Roggespierre." - The Wicker Bill

This dig is unnecessarily offensive and poorly conceived. Wicker Bill is referring to the paltry crowd at Chicagoland this year. I have not only stipulated to that fact, but also provided "supporting evidence" that is of a far more sophisticated orientation.

Wicker Bill has made my point. Oval racing fans will not accept a predominantly road racing product that occasionaly ventures into oval racing. However, they have demonstrated some enthusiasm for a predominantly oval racing product that occasionally ventures into road racing. Witness the two best-attended road races in the United States each year. They are at Watkins Glen and Sonoma, and they are not IndyCar events.

"I attended the Mid-Ohio race and I can tell you the crowd was outstanding.
The owner of the track told me the morning of the race that traffic was backed
up for four miles entering the course. This was not solely due to 'comp ticket
distributions by Honda and Firestone.'” - The Wicker Bill

My only claim regarding Mid-Ohio was that year-over-year attendance obviously declined in 2009. Notice that there is no rebuttal. In addition, Wicker Bill implicitly confirms my claim regarding comp ticket distributions by Honda and Firestone. "Not solely due to" would seem to imply that a good portion of the spectators at Mid-Ohio paid nothing for tickets. This does not present a particularly favorable valuation of the IndyCar product.

"Then, to wrap up the post, Roggespierre puts on his/her/its tin-foil hat and
leaves us with this gem: 'Oh, and if NASCAR Fans and Oval Fans were homogenous,
then the Indianapolis 500 could not possibly exist. Perhaps that is the
intent.'" - The Wicker Bill

The Wicker Bill has this one exactly right. It was a cheap shot; I am embarrassed to admit that I wrote it. Kudos to The Wicker Bill for calling me on it.

My goal here is to provide data analysis that might point the way to a successful economic path for the IndyCar Series. I failed in this instance. I apologize to readers who expect and deserve better.

Roggespierre

Wicker Adjustment for the Indy Idea

The Wicker Bill blog has called out the Incorruptible. This presents an opportunity for self-reflection and reconsideration of my founding values and operating tactics.

Let us examine some specific points of criticism and assess their relative validity. Some of Wicker Bill's insights are better than others; is this not true for us all?

"Indy Idea blogger Roggespierre - I'm sure this is some sort of clever
pun about the 18th century French master of the guillotine Maximilien
Robespierre, but I don't get it..." - Wicker Bill

Wicker Bill is apparently not alone in that regard.

Therefore, why Roggespierre?

1. Because heads have been rolling at the IMS and IRL administrative offices this year.
2. Because factional rivalry has thrown IndyCar racing into a state of perpetual and destructive revolution that has produced many economic carcasses and no market winners.
3. Because citizens tend to want the heads of IndyCar leadership without having a viable alternative at the ready.
4. Because I like the way it sounds.

"Roggespierre is clearly someone who wants most or all IndyCar races to be
run on ovals and allows this bias to influence his rhetoric." - Wicker
Bill

Wicker Bill's conclusion is correct. I do want most IndyCar races to be on ovals. I believe that the market for oval racing in the United States is much greater than the market for road and street racing. I want IndyCar to offer a racing product that the mainstream U.S. market will accept. I focus on the U.S. market because the Indianapolis 500 remains, at least to some degree, an iconic institution in its home nation.

I believe that a majority of racing spectators in the United States will not embrace an international, road racing product, no matter how outstanding that product might seem to those who like it.

I happen to enjoy sports car racing more than NASCAR racing. I thought that CART's North American Touring Car Series was outstanding. I was sorry to see it go. However, I also recognize that I am not at all representative of U.S. motorsports consumers at large in that regard. I believe that adults do well when they are honest with themselves.

"The blog entry begins by calling (Mike) King “a company man,” suggesting that his
statement that the attendance at Chicagoland, Kansas and Kentucky was poor this
year, and the attendance at St. Petersburg, Long Beach, Edmonton and Mid-Ohio
was good is because IndyCar told him too." - Wicker Bill

I respectfully request that Wicker Bill examine Mike King's public statements of seven or eight years ago. Compare them with his statements today. Then, explain where I got it wrong.

Wicker Bill commits a factual error that is fully confirmed by the record. I did not suggest that King challenged Pistone because "IndyCar told him to." I also do not believe this to be true.

Nobody has to tell Mike King what to say about IndyCar racing. He works there. King is fully incentivized to defend and support his bosses whenever he chooses to comment publicly. Therefore, my suggestion, in effect, was that Mike King is not a self-immolating moron. Why this is an object of controversy is beyond comprehension.

"Why would IndyCar, using King as a proxy, want to discredit three tracks
at which it will be racing at for the foreseeable future? Hell, Hulman & Co.
owns half of Chicagoland." - Wicker Bill

That is an outstanding and insightful question, one for which I have no answer. Perhaps Wicker Bill should ask Mike King. Perhaps I should, too. In this case, King's proclamations seem misaligned with the interests of both himself and his firm. I credit Wicker Bill for shining the light on this one.

Incidentally, Hulman & Co does not own half of Chicagoland. International Speedway Corporation purchased Raceway Associates (IMS was a partner) in 2007. I do ask that, if you must criticize, then kindly have the facts in order.

We shall continue this dialogue soon enough.

Roggespierre

IndyCar - "As If"

In his eulogy of the writer Alexander Solzhenitsyn, man of letters Christopher Hitchens wrote that the author of The Gulag Archipelago spent his career writing "as if."

...he carried on "as if" he were a free citizen, "as if" he had the right to study his own country's history, "as if" there were such a thing as human dignity.

We do not mean to compare ourselves with the heroic version of Solzhenitsyn (as opposed to the older, Putin-praising hyper-nationalist iteration.) But we do endeavor to follow his example in some very small way.

"As if" someone who is capable of taking meaningful action is reading The Indy Idea.

"As if" IRL leadership believes as we do that it can compete with NASCAR (sans-culottes!) and topple the House of France.

"As if" IndyCar management might courageously confront its core business problems, rather than chase temporary underwriters in increasingly remote and tertiary locations.

"As if" someone in power were committed to making the Indianapolis 500 and the Month of May in Indianapolis undeniably awesome again.

"As if" readers care about the long-term vitality of IndyCar racing.

Roggespierre

Tough Love for IndyCar

The Republic has again found cause to criticize actions taken by Indy Racing League Commercial Division President Terry Angstadt. We did not anticipate this becoming a recurring theme at the Indy Idea. Perhaps this is a good time to clarify our position regarding Citizen Angstadt.

First and foremost, we do not seek his head. Terry Angstadt appears to be a fine salesman. He has executed his primary responsibility ably, striking deals with new IRL clients such as Apex Brazil, Izod and Zoom Motorsports. Our criticism is not intended to diminish these accomplishments.

Second, we do not envy Citizen Angstadt. The cost of the product he sells is greater than the price at which it can be sold. Most firms would either redesign the product to increase its market value, cut the cost of production, or exit the sector entirely. Terry Angstadt is powerless in that regard. Who at the IRL has final authority to make strategic business decisions? We do not pretend to know.

Brian Barnhart manages day-to-day operations. Tony Cotman appears to be an inside representative of IndyCar's racing team suppliers. Terry Angstadt sells what he is given. Each answers to Jeff Belskus, who in turn has been charged with the workload of multiple executives.

We wish them success and prosperity. But, as Incorruptible citizens who love the Indianapolis 500 and Indy car racing generally, we must reserve our Natural Right to criticize their actions. And so we shall continue.

Roggespierre

IRL IndyCar Management Situational Reversal

Successful firms use the following hierarchy to guide their activities.

• Vision - what we want to be
• Mission - what we must do to get there
• Strategy - how we do what we must do to get there
• Tactics (product development, sales, operations) - doing what we do

The Indy Racing League appears to use something more akin to the hierarchy below.

• Product - what we have
• Tactics - selling and operating what we have
• Dreams - the best we can hope for given what we have

IndyCar: The Mission

Normally, we are not big fans of mission statements here in the Republic. Revolution is, after all, about taking action.

That said, we here have learned the hard way that overturning the old order is not sufficient to bring about peace and prosperity. Without direction - a mission, if you will - citizens tend to lose their heads.

It is with this in mind that we present the beginnings of a mission statement for the Indy Racing League. It probably already has one. But the IRL would do well to remember that firms tend to be myopic, believing that their respective industries are unique and that, therefore, so, too, are the challenges they must overcome. This is seldom the case. If it were, then McKinsey, Bain, and the other high-priced consulting firms would be out of business.

Fortunately for the IRL, The Indy Idea has no delusions about its market value. The advice here is free.

So, what is the mission? What would a really successful IndyCar Series look like?

• Ridiculous profits to the Indianapolis Motor Speedway
• Undeniably awesome Month of May in Indianapolis
• Corporations competing to sponsor IndyCar teams
• Promoters competing for race dates
• Drivers aspiring to get to IndyCar and stay there
• Versus becomes a household name
• The IRL at least breaks even

Achieving these long-term goals is possible with focused strategy and meticulous execution. NASCAR (sans-culottes!) followed this route to mass market nirvana until, alas, it lost its sense of discipline. For the first time in its history, the House of France faces contraction. It is very vulnerable.

IndyCar is not positioned to take advantage. That does not mean it can't happen, but rather that it can happen only if the IRL is disciplined, determined and courageous enough to do the jobs that must be done to achieve its mission.

Roggespierre