For the good of the teams Honda and Indycar need to settle their spat, one way or the other, before the end of the month.
For those of you who are Honda Racing fans and Indycar fans, you know from reading articles in various print and online publications that the Honda’s under-performance in the series has soured many relationships:
- The relationship between Honda and Indycar that goes back to 2003.
- The relationship between Honda’s teams and Indycar.
- The relationship between Honda Performance Development and its partner teams.
A Brief History
Honda and Indycar have acknowledged that they have been discussing an extension since this time last season. Over this time, the issues have mainly been the amount of money that Honda spends subsidizing the teams, the length of the schedule and the commitment that Indycar requires from its manufacturer partners. Honda clearly wants costs to be reduced to be more in line with the return they are getting from their investment in the series.
It was widely reported that Indycar and Honda had reached an rough agreement at the beginning of May. That all flew out the window on the Sunday of Qualifying for the Indy 500. You may recall that the Chevys were getting airborne, causing dangerous-looking crashes. Indycar decided to slow all the cars down, even though there was nothing demonstrably wrong with the Hondas. Worse, Indycar decided to do this with input from Chevy, but not Honda. In fact, Honda was told about it 30 minutes after Chevy knew about it and was presented to Honda as a fait accompli .
This has caused a “trust problem”.
That’s not the only issue. Honda is not happy with the “Aerokit” experience. Honda has been demonstrably behind since day one. The problem is how to deal with that. From Indycar’s point of view the answer to this is simple: It wants Honda to spend more money and design new aero parts. Honda, on the other hand, wants to bring costs DOWN , not spend more just to catch up while Chevy improves. Also from Honda’s point of view, the Aerokits were far more expensive than they planned and Indycar has been difficult to deal on the subject. Honda wants them binned.
At this point, it does not appear that there is much negotiating going on. And this is starting to affect a lot of interested parties:
THE TEAMS: How are the teams going to plan for next season when they don’t know what Honda’s plans are? They also don’t know if it’s time to jump to Chevy or make some other plan for next season if Honda is unable or unwilling to improve its on-track product. If Honda leaves, Chevy may not have the capacity to fill the whole field. And if Chevy does have the capacity, they would likely charge the former Honda teams more than what they were paying Honda.
PARTNER PROMOTERS: Honda supports several of the races. It is the Title Sponsor of the events at Barber, Mid-Ohio, Toronto, and helps sponsor Milwaukee. It’s unlikely they continue those relationships if Honda leaves the series, leaving those events with a significant revenue holes to fill. Barber and Toronto might be able to find new sponsors, but they would need to start looking yesterday. The Mid-Ohio event (which is a Honda company Picnic) would almost certainly go under. Milwaukee is teetering financially as it is. Losing the Milwaukee Honda Dealers as a presenting sponsor could be the last straw.
HPD SUPPLIERS: While some of them might pick up business with other projects eventually, doesn’t HPD owe them more than two months notice either contractually or as a gesture of goodwill?
THE SOLUTION: SET A DEADLINE
Either Honda or Indycar has to set a drop dead date for these negotiations. I suggest Close of Business Friday, June 26, Pacific Time. That’s the start of the weekend for the next Indycar race in Fontana. If the parties can’t come up with a deal by then, they need to shake hands and walk away.
Yes, I know this is a long-term relationship. Yes, for those closely involved it’s going to feel like they lost a limb if Honda and Indycar go their separate ways. I’ve been there. Prolonging the process only makes it worse.
Like any troubled marriage, the ones that are hurt most are the kids. In this case the kids are the Honda teams, the Honda races and the associated marketing, facilities, and operations people whose livelihoods have come to depend on Honda’s participation in Indycar (not to mention the retrenching pain that is going to come to the series if Honda leaves). The series will lose races. The 100th running of the 500 will have a hollow ring to it. Teams will fold. Staffers will get “right-sized”. And then there’s the fact that Chevy would likely follow Honda out the door when their contract expires next year. Chevy was recruited by Ilmor, Roger Penske (part owner of Ilmor), Indycar and Honda precisely to come into the series to compete with Honda. With Honda gone, why would Chevy stay?
So during this lull in the racing schedule, Honda and Indycar need to clear their schedules, pick a place to meet (I have an office in Chicago) and either work it out or walk away. If you can’t fix this in two weeks, you can’t fix it.