On Tuesday, the National Hot Rod Association issued a bulletin to its Mello Yello Drag Racing Series participants, outlining adjustments to its payout structure for the remainder of the abbreviated 2020 season. In what it states is in “consideration of the impact of the coronavirus pandemic”, the winner’s payouts in the nitro categories were reduced from $35,000 to $15,000 (already down from $50,000 prior to the pandemic), and subsequently, a reduction in the winnings at each rank on down the order. Pro Stock, meanwhile, was cut to $6,000 to win, and Pro Stock Motorcycle a meager $3,000.
A number of the professional race teams — particularly the lower-funded, independents — build their annual budgets around the income stream of qualifying and round money. With many expenses fixed (staff salaries, flights, and transporter fuel, for example) and many sponsorship deals pro-rated this season to account for the reduced number of events, many teams, like Top Fuel racer Terry McMillen, are finding themselves bursting at the seams financially and forced to decide between sitting out races, or digging into their own bank accounts to soldier on through the remaining five events.
The NHRA’s Vice President of Racing Administration, Josh Peterson, in opening his letter, noted the decision was made after “extensive discussions between NHRA and professional teams and their representatives,” but McMillen tells Dragzine “the funny part is I’ve called the race teams to find out who they did speak with and haven’t found one that knows anything about it.”
“We all knew it existed, because they [NHRA] presented it to PRO (the Professional Racers Organization) and the PRO board turned it down and said, ‘no way, we’re not accepting that,’ ” McMillen continues. “So, the question now is if they did it despite what PRO stated. But they did not talk to any of the race teams that I’ve spoken with, and that’s quite a few.”
Prior to the coronavirus pandemic, winners earned $50,000, the runner-up $22,000, $18,000 to the semifinalists, $14,000 to quarterfinalists, and $10,000 to first-round losers. After the break, those numbers were reduced to $35,000, $17,000, $12,500, $10,000, and $7,500, respectively.
PRO had begrudgingly approved the previous payout reductions that went into effect upon the NHRA’s return to racing in July and remained in place through last weekend’s U.S. Nationals at Indianapolis. McMillen understood the need to meet the association halfway for the prosperity of all involved at the time, but is taken aback by this most recent measure.
“It made sense at the time, with the climate the way it is, but lowering it to this point is ludicrous. It really diminishes the value of our sport. There a lot more negative things that come out of this than positive,” he says.
McMillen notes that there is a collective conversation behind the scenes to boycott the upcoming Gatornationals in Gainesville, Florida, September 25-27 — an event title-sponsored by his primary backer, Amalie Motor Oil.
…it comes down now to a decision of whether or not we sit out a race, because we can’t afford to do all this, based on this payout, because we’ll be bankrupt going into next year, and that’s not going to happen.
“As a corporately-backed team, we have a budget and we have guidelines and that’s what we work within. If Amalie wants me to be in Gainesville, we’ll be in Gainesville. But in the past, when there’s been situations, like nitro costs and things like that, where it was all set to take place and we were going to sit out Gainesville [the original March date], Amalie has 100-percent supported me in whatever decision I want to make. If nobody decides to go to Gainesville, which is sounding more and more realistic, then I am fairly confident Amalie will support me in that. Without the pro teams, there really isn’t a show, and I hope it doesn’t get down to that.”
McMillen, who unlike some of the larger teams whose sponsorship monies fully covers operational costs, factors qualifying money into his yearly budget to help offset many of the associated costs of racing.
“If you take the Wilkersons, Clay Millican, Terry Haddock, Jim Dunn, those guys that go up and down the highway every weekend, they’re all dependent on that money. There are more teams dependent on that payout money than not. I’m not funded like a Don Schumacher or someone like that, but Amalie has really supported us and we have enough money to get by. But the qualifying money is what we use for nitromethane and hotel rooms…it pretty well always covered that. Now, we have the elevated prices of nitro — it’s out of control and shouldn’t be this high — and then you have hotels rooms that, because we’re booking on short notice with the new schedule, we’re paying full price instead of getting deals like we used to. We might have been paying $79 a night or something, and now it’s $240 a night. So all those discretionary funds that we use to cover those two big expenses aren’t there anymore. So I have enough money to run my team with what we have, as long as we had that money coming in, and now we don’t. So it comes down now to a decision of whether or not we sit out a race, because we can’t afford to do all this, based on this payout, because we’ll be bankrupt going into next year, and that’s not going to happen.”
Worth considering, too, are the public relations ramifications of the reduced payouts and the possibility of a boycott.
“When you look at corporate America, and we’re trying to secure additional sponsors to come in and participate in our sport, and they see things like this, it’s kind of demeaning. You can go to Martin, Michigan this weekend and run an Alcohol Funny Car and get 20-grand for four passes. We don’t even get that to win now, and we’re at six passes. This is bracket racing money, not professional money. I’m just lost on why they think this would be okay. I know, just like everybody, this virus has really messed everybody’s cash-flow up, but rather than mandating things, it would be nice to have an opportunity to negotiate. And unfortunately, I think the real loser in this is going to be NHRA, because when teams don’t show up in Gainesville, it’s really going to look bad for them.”
McMillen says that, from the very beginning, he believed pulling the plug on the season to minimize financial losses was in the best interests of the NHRA.
“When you look at our sport, because it’s funded differently from NASCAR, I think we would have been better off cutting our losses and regroup going into 2021 with guns blazing and make it bigger and better. Instead, we’re bleeding everything that NHRA has. And Coca-Cola has to be looking at this and thinking this is not good…these people are their customers, and they’re being impacted.”
On a full weekend, you’re spending $150,000 to win $50,000, and we haven’t had a pay increase in forever. We’re still going to spend $120,000 on a race weekend to compete for $15,000. It only makes sense to go out first round and cut your losses, but you want to do right by your sponsors and your fans and all your supporters, so it only makes sense go go out there and run the thing. And they’re putting teams in a position where they’re not going to be able to come back next year.”
I think the real loser in this is going to be NHRA, because when teams don’t show up in Gainesville, it’s really going to look bad for them.
“And what’s the payout going to be at the end of the year? Let’s say I’m fortunate enough to be in the top three — and we can be, we’re not that far away — I have to make a decision whether I want to put $200,000 on my credit card to ensure that I have everything I need to go out and win that championship, and then find out you’re only racing for $10,000. They’ve made very clear that the money for these recent races is coming out of the points fund, and if you do the math on the payouts for all the pro classes for these last four races, there can’t be any money left for the championship. That’s why they should have just pulled the plug: now it’s just making a mess bigger and worse. The black eye is really getting bigger, and who knows how many teams will even be left next year.”