Fear of commitment
Top sponsor may end partnership with NASCARPosted: Wednesday February 05, 2003 7:32 PM
DAYTONA BEACH, Fla. (AP) -- R.J. Reynolds Tobacco Co., the top sponsor for NASCAR's Winston Cup Series since 1971, hinted Wednesday it is considering ending its longtime partnership.
RJR signed a five-year contract extension with NASCAR in July, exactly one year after the company picked the stock car series as the one program it can bankroll under the 1998 tobacco settlement.
But a weak economy has forced RJR to reevaluate its commitment since signing the contract extension.
"Since that time, our business dynamics have changed dramatically," said Ned Leary, president of RJR's Sports Marketing Enterprises division. "In our ongoing conversations with NASCAR, we have discussed the potential of their exploring a new series sponsor at some time in the future."
NASCAR vice president George Pyne said the sanctioning body enjoys its 32-year relationship with the tobacco company, but is now looking at future opportunities with other companies.
"Through the years, we've had one of the best partnerships in sports," Pyne said. "But through their changing dynamics, they've told us that if there is an option that would be in the best of our industry, we should take that into consideration."
Pyne said he fully expected RJR to fulfill its five-year contract extension.
NASCAR's drivers, teams and partners have all shared in an estimated $100 million in purse, bonus and point fund money since becoming the Winston Cup Series in 1971.
The brand has become synonymous with NASCAR since the two companies partnered, with the cigarette brand Winston becoming a staple of the top racing series in America.
The tobacco company was forced to pick one sport to sponsor to comply with the Master Settlement Tobacco Agreement, which forced cigarette manufacturers to reduce their sponsorship to a single program in a 12-month period.
So Winston ended its sponsorship of the National Hot Rod Association and professional golf. Last month, RJR announced it was ending its NASCAR's No Bull 5 Program for 2003 after a five-year run. The bonus program offered $1 million to a driver and a NASCAR fan in five selected events.
RJR has continued to sponsor NASCAR's Winston West stock car series.
Word of RJR's possible split comes just a week after ConocoPhillips, owner of the 76 gasoline brand, said it was ending its half-century-long relationship with NASCAR.
The familiar logo -- an orange ball with the number "76" in blue at its center -- has been a fixture at races as "the official fuel of NASCAR."
But 76's Houston-based parent company said it was ending the sponsorship deal of more than 50 years by Dec. 31.
"Due to changing business strategies, we are unable to take full advantage of NASCAR's national and international marketing platform," Mark Harper, president of wholesale marketing for ConocoPhillips, said last week.
Pyne said it shouldn't be hard for NASCAR to find more sponsors in the future.
"We're coming off our best year in television, our best year in attendance, our best year in almost every area," Pyne said. "We offer a once in a lifetime opportunity to major companies that is equivalent of branding yourself with the NFL or Major League Baseball."