The market is undergoing a big correction when it comes to what Cup Series drivers are paid.
That’s what’s happening according to Dale Earnhardt Jr., who is retiring at the end of the season. Junior is being replaced by Alex Bowman in 2018 and it’s safe to say that Bowman is making a fraction of what Junior is currently paid by Hendrick Motorsports.
That makes sense. Bowman is a relatively unproven driver and doesn’t have the massive earning power Earnhardt Jr. does when it comes to merchandising. Hell, no one in NASCAR does.
But Bowman likely being paid less than Junior isn’t a unique case. Here’s what Junior had to say Saturday:
“You’ve got to look at guys like myself. There’s sort of been a major shift in how much drivers are getting paid. How they’re getting obviously changed with the new agreement we had a couple of years ago. Drivers started taking more of the purse. I don’t know everybody’s contract situation, but there is a less of a base and more purse-driven.
“But one thing that’s changed is that you’ve got a lot of young guys coming in being offered and accepting contracts that are a fifth to a tenth of what veterans are getting paid. And, that’s money that can go into the team, you know? These sponsors aren’t giving teams the money that they used to. So, the owners and everybody’s got to take a little cut. Everybody’s got to dial it back. Everybody’s got to realize that they have to accept some of that fallback and difference. And that’s the same with the drivers’ contracts. A lot of these veteran drivers are getting paid multi-million dollars; and a lot of these guys coming in are getting a fraction of that.
“Well, when you look at it, you’ve got a car, right? Say we all are sitting here with race cars and nobody to drive them. You’ve got a guy that you think has got a lot of talent, very young, a lot of potential. And then you’ve got a veteran who is established. But he wants three, four, five, or six times the amount of money. You’re going to go with the younger guy because it’s a better deal financially. So, that’s something that I think is transitioning in the sport. It took a while but when we had our major reset when the recession hit and everything sort of changed and the value of everything changed, the trickle-down.
So, that’s something that I think is transitioning in the sport. It took a while but when we had our major reset when the recession hit and everything sort of changed and the value of everything changed, the trickle-down effect I think is coming down through the driver’s contract and it’s making a big difference in the decisions these owners are making. You can’t pay a driver five to eight million dollars a year if you ain’t got but $10 million worth of sponsorship. That ain’t going to work.
Guys aren’t getting $20, $30, $40 million a year on sponsorship. Owners aren’t getting that anymore. Drivers are having to sort of understand that change is coming down the pike if it hasn’t happened to them yet, it’s going to happen to them. And the young guys, they don’t know any better. They want to race and they’re taking whatever they can get. That’s a good change for the owners. Somewhere in a quote years ago, I do believe I admitted to being overpaid (laughter). But I wasn’t going to complain. That’s a shift that’s going to be better for the sport and get those salaries into a realistic range for how much money we have from corporate America. All those things have to change, you know? Drivers’ salaries included. Yeah, all those drivers out there in the garage are going to say that’s easy for him to say (laughter).”
It’s reasonable to think that Joe Gibbs Racing is saving considerable cash by swapping out Erik Jones for Matt Kenseth in 2018. Jones is in his rookie season and as a former Cup champion and one of the most productive drivers of the last 20 years, Kenseth can command top dollar.
Stewart-Haas Racing likely declined Kurt Busch’s contract hoping that it could come to terms with Busch on a new deal for 2018 pending a renewal of Monster as one of Busch’s co-primary sponsors. And it’s a safe bet that Chase Elliott doesn’t get what Jeff Gordon got from Hendrick.
And while there’s a chasm in how much drivers make from series to series — there are many Xfinity and Truck Series drivers who aren’t getting rich — top drivers in the Cup Series are still doing better than 99 percent of the population even with salary cuts. Don’t feel like you need to go buy a hat to help your favorite top-tier driver put food on the table. He’s not going to see much of the profit from that hat anyway and you need the money more than he does.
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