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View Full Version : Lease a DP01 in '07.



racer2c
09-08-06, 03:13 PM
I've got $1000. Who's in? We just need to pool $999,000 more. We'll share driving. :)

Link (http://www.speedtv.com/articles/auto/champcar/32370/)

Gangrel
09-08-06, 03:15 PM
http://www.speedtv.com/articles/auto/champcar/32370/

Gotta' hand it to KK....his ideas may not always be the best in the mind of his critics, but he always has new ones. KK maps out functional strategies way quicker than TG changes vision. :D

Sounds like leasing packages is what attracted PCM to CCWS. I wait to see who else comes because of this deal.

I am not so sure about the idea of capping the # of cars at 24. I like his notion of creating value in the teams by limiting participation in the series, but I still would love to see this series get back to where some folks have to go home each weekend because they didn't make the show.

Insomniac
09-08-06, 03:18 PM
http://www.speedtv.com/articles/auto/champcar/32370/

Gotta' hand it to KK....his ideas may not always be the best in the mind of his critics, but he always has new ones. KK maps out functional strategies way quicker than TG changes vision. :D

Sounds like leasing packages is what attracted PCM to CCWS. I wait to see who else comes because of this deal.

I am not so sure about the idea of capping the # of cars at 24. I like his notion of creating value in the teams by limiting participation in the series, but I still would love to see this series get back to where some folks have to go home each weekend because they didn't make the show.

I take it as just talk now since they don't even have 24 cars. If there is a merger, it will most definitely change. Once they hit 24, we'll see how hard they try and stick to it if there is no merger. Maybe until the sidepods are no longer empty.

dando
09-08-06, 03:22 PM
What's the mileage allowance? :D

-Kevin

KLang
09-08-06, 03:25 PM
How many cars fit on a plane for overseas races? I suspect that is probably where the 24 comes from. If the economic situation for the series and the teams turns around I doubt that limit would remain.

I assumed Champ Car was going to have some sort of financial deals to get the new cars rolled out. It appears Champ Car will own some/most of the cars. Can they depreciate them off over time? Can a team do the same if they purcase instead of lease?

Gangrel
09-08-06, 03:31 PM
How many cars fit on a plane for overseas races? I suspect that is probably where the 24 comes from. If the economic situation for the series and the teams turns around I doubt that limit would remain.

I assumed Champ Car was going to have some sort of financial deals to get the new cars rolled out. It appears Champ Car will own some/most of the cars. Can they depreciate them off over time? Can a team do the same if they purcase instead of lease?

The only teams that get the lease deals are new ones, according to the article. KK said the existing teams already got their own deals, this is to attract new teams to the series. $1 million for chassis, engine and tires for testing and races, sans electronics, salaries and other equipment. Sounds like a pretty good deal, especially with a $2 million scholarship prize for the Atlantics champion.

Unless the lease is considered a capital lease, CCWS would get to depreciate the leased equipment, not the teams. Unless 1 year is considered to be substantially all of the chassis and engine's lifetime, then I doubt these would qualify as a capital lease.

Spicoli
09-08-06, 03:48 PM
Another ACE move!:thumbup:

Spicoli
09-08-06, 03:52 PM
How many cars fit on a plane for overseas races? I suspect that is probably where the 24 comes from. If the economic situation for the series and the teams turns around I doubt that limit would remain.

I assumed Champ Car was going to have some sort of financial deals to get the new cars rolled out. It appears Champ Car will own some/most of the cars. Can they depreciate them off over time? Can a team do the same if they purcase instead of lease?

Yes. to Q 1.

oddlycalm
09-08-06, 03:56 PM
Great idea IMO. I look at the GA vs ALMS threads and I see the big field/intense competition arguments vs credible race cars with current technology arguments and KK seems to want to merge the two. An affordable car that uses current technology and has serious performance looks like a smart strategy to me.

At $4 million per the package seems pretty compelling to me compared to running GA in front of empty grandstands. Regardless of anything else, CCWS still has attendance figures that the IRL, GA and ALMS would kill to have. It's a bit of a company store, just as GP2 is, but as long as the store is run fairly that shouldn't be a concern. And, with a lease if you decide the store is not run fairly you can wave goodbye and walk away without having to find a buyer for the equipment. :thumbup: Nobody likes risks and unknowns and this simply eliminates a big one.

Another thing that makes me believe he's on the right track is this season's GP2 and Atlantics series which have had some great racing with some good talent resulting in interesting title battles as well. I think we have a pretty good idea that the DP01 will give us that kind of racing and the affordability is what will bring the teams in this post-tobacco money world. I gotta believe that are guys in the DP's that would like to be back in a real race car again.

oc

racer2c
09-08-06, 04:10 PM
http://www.lagxbl.com/forum/images/smilies/hangman.gif

Andrew Longman
09-08-06, 04:32 PM
4 million to run the season on the lease. What's the cost to buy it outright?

Interesting idea of capping the entries at 24. That also creates an incentive to stay in the series because the value of the slot should increase and teams would not want to give it up.

But does that mean that participants actually own a franchise as in the old CART days (and present day F1)? If so, are did they pay anything for them or have they just been granted them to reward them for sticking with CC?

I like the idea and I'm OK with 24 cars. I'd like 26, but I'll be happy to put 17 car counts in the past

Gangrel
09-08-06, 04:40 PM
4 million to run the season on the lease. What's the cost to buy it outright?

Interesting idea of capping the entries at 24. That also creates an incentive to stay in the series because the value of the slot should increase and teams would not want to give it up.

But does that mean that participants actually own a franchise as in the old CART days (and present day F1)? If so, are did they pay anything for them or have they just been granted them to reward them for sticking with CC?

I like the idea and I'm OK with 24 cars. I'd like 26, but I'll be happy to put 17 car counts in the past


You misread. $4 million total budget to run the season. The lease itself, for Chassis, engines, and tires is only $1 million. That doesn't cover salaries, other equipment, electronics, crash damage, fuel, transportation costs, etc.

Andrew Longman
09-08-06, 04:49 PM
You misread. $4 million total budget to run the season. The lease itself, for Chassis, engines, and tires is only $1 million. That doesn't cover salaries, other equipment, electronics, crash damage, fuel, transportation costs, etc.

No I read it correctly, I just didn't express myself well:gomer:

If it costs $1mil to lease the chassis, engines and tires and that nets a $4mil annual budget when you add the other stuff, how much of a savings is that really?

And as with engines, does that lease keep you in business regardless of how many chassis, tires and engines you use (up to a point defined by the lease) thus giving owners more cost certainty?

I'm just trying to fully understand the economic advantage of this.

Gangrel
09-08-06, 05:11 PM
No I read it correctly, I just didn't express myself well:gomer:

If it costs $1mil to lease the chassis, engines and tires and that nets a $4mil annual budget when you add the other stuff, how much of a savings is that really?

And as with engines, does that lease keep you in business regardless of how many chassis, tires and engines you use (up to a point defined by the lease) thus giving owners more cost certainty?

I'm just trying to fully understand the economic advantage of this.

ahhh.....don't have answers on that, but considering the response in the media and the immediate response from PCM, I am guessing that engine, chassis, and tires would cost substantially more if you were to buy them outright, especially if the chassis is designed to last much longer than a year.

Lease does not cover crash damage, so I am assuming that if you break it, you bought it. Might be incentive to put a driver in the cockpit rather than a ride buyer. ;)

NismoZ
09-08-06, 08:16 PM
So, how similar is this to A1?

Indy
09-08-06, 11:08 PM
A cap on entrants sucks, sucks, sucks.

Spicoli
09-08-06, 11:21 PM
http://www.freewebby.com/action-smilies/award.gif

extramundane
09-08-06, 11:29 PM
So, how similar is this to A1?

It's not nearly as good on steaks.

robot9000
09-08-06, 11:36 PM
Penske, in this months Racer said an IRL team needs 5-6 Mil to run per car. So, KK's figure of 4M to run a car is considerably cheaper. Smart move. Especially if the replacement parts are cheaper. Like Atlantics vs IPS - it might not get current teams to move, but anyone that wants to move up to big league OW, will have a hard time NOT choosing Champcar.

Insomniac
09-09-06, 10:11 AM
A cap on entrants sucks, sucks, sucks.

Probably shiouldn't worry about it until it is reached and someone is actually turned away.

formulaben
09-09-06, 02:08 PM
A cap on entrants sucks, sucks, sucks.

Care to explain why? A cap does indeed raise value, just look at F1, but what it also does is prompt the fence-sitters at the EARL to ***** or get off the pot.

racer2c
09-09-06, 02:25 PM
What is the max amount of pitboxes at any given track?

formulaben
09-09-06, 02:40 PM
What is the max amount of pitboxes at any given track?

I recall that being a concern at certain tracks. Which ones, I can't recall.

nrc
09-09-06, 02:57 PM
I recall that being a concern at certain tracks. Which ones, I can't recall.
Nazareth

NismoZ
09-09-06, 03:17 PM
OK, assuming all 18 return (a little optimistic?) can we add 2 for Gelles and 2 from PCM? Stoddert is now sounding like he might want to buy or buy IN to a team, bringing his own "known" drivers so he says we'll know by the end of October. Forsythe could run 3 or 4 (:eek: ) according to a rumor or two. Dario could stay on even IF daMatta returns to Rusport says another story, so that could be 2-3 more? What about Rahal? N/H? Third car? Loks like an easy 26 to me. I think the "cap" idea had it's origins in concerns about OVERexpansion at too rapid a rate. 24-26-28 over three years sounds good to me!:) Make it sound very exclusive and they'll beg to get in!:D

Insomniac
09-09-06, 03:38 PM
Nazareth

They had 26 at the height of NAOWR and the rest didn't start the race.

Indy
09-09-06, 11:16 PM
Care to explain why?

F' the IRL. Who cares if they come or go? All I can say is that I spend big bucks to go to races and watch too few cars. I used to spend big bucks to go to races and watch a very satisfying number of cars. Now, I may be wasting my MBA here, but this is a fan forum, and I am a fan, and I don't care what Mr. K's business strategery tells him, I want to see a lot of cars.

Dammit. :irked:

nrc
09-09-06, 11:55 PM
It's interesting that KK says he thinks they'll reach capacity of 24 in '08. Right now if all 18 current seats were filled for next year and we add the 4 announced new seats they're at 22. So if KK doesn't expect 24 until '04 either they're expecting to lose some current seats or they're really not pushing this program the way this story makes it seem.

That makes sense given the teams we have announced so far. Why cast a drag need a bring up a bunch of one season wonders when you can target teams that have shown themselves to be stable?

formulaben
09-10-06, 01:25 PM
F' the IRL. Who cares if they come or go? All I can say is that I spend big bucks to go to races and watch too few cars. I used to spend big bucks to go to races and watch a very satisfying number of cars. Now, I may be wasting my MBA here, but this is a fan forum, and I am a fan, and I don't care what Mr. K's business strategery tells him, I want to see a lot of cars.

Dammit. :irked:

OK, fair enough, but don't you think that just as there can be too few there can also be too many? I don't know what that number is, but if for some reason a couple scumbags from brand X come over here, that would certainly put some of the lesser teams at risk, no? A cap rewards those who stayed here and almost assures the number is met, and that number is much better than 18.

My 2 cents. Thanks for answering the question, BTW.:thumbup:

Indy
09-10-06, 09:29 PM
Too many? I'll let you know when we get there.

Spicoli
09-10-06, 11:15 PM
Too many? I'll let you know when we get there.

IV makes too many. Micro makes too many. Danicle makes too many.:gomer:

Indy
09-11-06, 01:20 AM
IV makes too many. Micro makes too many. Danicle makes too many.:gomer:

I don't know that I care too much about them. Let them be humiliated in a real series.

There are some real traitors I would hate to see in CC, but the rest, well, the world needs 'King Hiro's too, you know.

Insomniac
09-11-06, 09:43 AM
OK, fair enough, but don't you think that just as there can be too few there can also be too many? I don't know what that number is, but if for some reason a couple scumbags from brand X come over here, that would certainly put some of the lesser teams at risk, no? A cap rewards those who stayed here and almost assures the number is met, and that number is much better than 18.

My 2 cents. Thanks for answering the question, BTW.:thumbup:

I think there is too many when the logistics are a problem at a lot of events. I do see the value in a cap by increasing the worth of a seat, but that only works if people want to buy an existing team for more than it was worth to get into the series. Also, the cap would not prevent a lesser team from being taken out. The richer teams can surely wave money around to buy a seat.

CART did a fine job in the past determining the maximum number of cars that can qualify at a track. I never watched a race and wished there were less cars, but I have surely watched races the past 3-4 years and wished there were more.

formulaben
09-11-06, 11:56 AM
I do see the value in a cap by increasing the worth of a seat, but that only works if people want to buy an existing team for more than it was worth to get into the series.

The presumption is that the field will fill up, either before or after the 2007 season, after which the value is there. Anyone wanting into the series at that point MUST purchase or merge with another team. That's a great position to be in, if you're one of the existing teams.


Also, the cap would not prevent a lesser team from being taken out. The richer teams can surely wave money around to buy a seat.

No cap certanly makes is harder for small teams. I would much rather a small team get bought out than a small team getting pushed out due to huge nubmers. Certainly a cap contrives the system, but a small team has a much harder time competing (off the track) with an "unlimited" number of teams.

Insomniac
09-11-06, 12:16 PM
The presumption is that the field will fill up, either before or after the 2007 season, after which the value is there. Anyone wanting into the series at that point MUST purchase or merge with another team. That's a great position to be in, if you're one of the existing teams.

I don't think the value is there immediately or automatically. Once it fills up, a new team would have to weigh wether it is worth the amount of money needed to buy out a team to join the series. The series has to provide that value somehow to make it worthwhile. In my opinion, it will be a hinderance at first. Who is going to want to buyout a team and then spend the money to run it on top of that right now. If you can't get to 24,, what makes you think when you do, someone wants to buy in. Let them just start a new team if that is what they want.


No cap certanly makes is harder for small teams. I would much rather a small team get bought out than a small team getting pushed out due to huge nubmers. Certainly a cap contrives the system, but a small team has a much harder time competing (off the track) with an "unlimited" number of teams.

I fail to see how a cap on car count makes a difference right now. Maybe if the series could buold value to the point where getting sponsorship money isn't an issue, but as loing as it is, a team with more money will have more resources. They can either join the series adding to the car count or try to buy out an existing team. If the existing team wants to be there and suck, it's their choice. And you've just stopped a team that wants to be there and compete with the best from joining.

NismoZ
09-11-06, 03:38 PM
Stoddart was saying he could do it either way but it'd make more sense to base in Indy with an existing operation. Put this together with the real possibility that KK owns assets of CTE-HVM (and would love to have it pay it's own bills!) and you might have a new team with Eurodrivers, but not increased numbers. Might have a new name and owner but I don't think a lot of people would be "pushed" out...except maybe the drivers. (?) Sounds like Gelles and PCM are in and the Dutch could buy in. That's only an additional 4 entries, not 6. If Forsythe (Red Bull, Jani, maybe at PKV?) and/or N/H do a 3rd car (Rahal) that would be the 24 right there. My guess is it's a one season "soft" cap. (and, personally I think Forsythe would do 4 cars before Haas would do 3!...unless Graham can bring 2 mil. after RA!)

nrc
09-14-06, 12:48 AM
Forsythe doesn't seem to think that the 24 number is a hard limit.

"There's another two-car team that will be announced very soon," Jerry Forsythe said last week. "I believe we can get to twenty-four cars and we'd like to have twenty-six. That would really make a statement."
http://www.crash.net/feature_view~cid~3~id~10136~pid~4.htm

Stoddart team?

NismoZ
09-14-06, 06:39 PM
Sweet. Red Bull/Jani, Rahal, Simon, 2 million CC bucks...who might be the Europeans of choice for a Stoddart entry? I read awhile back that if Doornbos got an F-1 deal (I think he has) then the Muermans Dutch CC team wouldn't be a go. With Assen on line you think they'd do it anyway. That'd bite if it doesn't happen ( I see Bernie getting in the way somehow), but a third Atlantic team moving up would make me forget that quickly. Good luck CC.:thumbup: