Auto Industry News: Roger Penske Buys IMS and IndyCar, Industry Shows Wrap Up, and the UAW Keeps Busy

It’s been a big week for the business side of the industry this week. Roger Penske announces his purchase of the famed Indianapolis Motor Speedway and IndyCar series. Big events like the 2019 Tokyo Motor Show and 2019 SEMA Show wrapped up. And the UAW finalizes talks with Ford and sets its eyes on FCA, all while juggling another official’s indictment and the FCA-PSA merger.

Roger Penske Buys Indianapolis Motor Speedway, IndyCar Series

Roger Penske, the racing pro turned billionaire businessman in charge of one of the most successful companies in racing, just became the fourth owner of the iconic Indianapolis Motor Speedway.

In a deal seemingly coming from nowhere, Penske purchased not only the 110-year old racetrack but the offshoot IndyCar Series along with it, a racing series that Penske’s team has dominated over the years.

The Associated Press obtained a copy of an IMS document sent to IndyCar teams. It sheds a little more light on the remarkable purchase:

“We have found the ideal steward of the company and its iconic assets,” the document said. “Penske Corporation — with its 64,000-plus employees and more than $32 billion in consolidated revenue — will bring tremendous energy, leadership and resources to IMS, IndyCar and IMSP.”

“For a number of years, the Hulman & Company management and board have engaged outside advisers and experts to consider the full range of strategic options available. Ultimately, it was decided to focus on the possible sale of the company and finding a buyer that would be the best steward of the company and its iconic assets,” it continued.

To put it plainly, this is a big deal for motorsports. 

Penske being involved adds an air of financial stability to the IndyCar series during a time when it has struggled to secure sustainable sponsorship, TV ratings, and ticket sales. The man’s net worth is an estimated $1.6 billion and his company brings in over $20 billion a year.

More than his money, though, Roger Penske brings experience and open-mindedness to the sport.

“Penske’s willingness to adapt in the face of failure is a critical part of his approach,” says RACER Magazine. “Fueled by the frustration of whatever’s gone awry, Penske’s hardened reactions, driven by intense problem-solving and resource allocation, have resulted in major turnarounds. IndyCar, and IMS, to a lesser degree, will benefit from the same formula.”

Addressing Concerns

For those worried about the man behind the winningest team now owning the series, Penske has already made moves to keep things fair. Stepping down from his usual spot in the pit box, he is now promoting Team Penske president Tim Cindric to call races in his place. Penske is also turning the sport’s sanctioning body into a separate “company” that would reside outside his control. Ultimately, his focus will be on the business end, making the series and speedway more profitable and more popular.

According to the Indy Star, even his competitors, like Michael Shank co-owner of Meyer Shank Racing, are okay with the moves he’s made. “I’m actually going to sleep better at night knowing Roger is at the helm,” said Shank. “I don’t think there’s any possible way he’d risk his new stewardship to win two more races or another 500. There’s too many people watching him and too much to lose, and they’ll be hyper-sensitive to it, too … He’s built his whole life on ethics at the highest level.”

While we don’t claim to be soothe-sayers or psychics here at The Engine Block, we can confidently say this looks like a good sign. The deal likely means closer bonds between IndyCar and NASCAR which could lead to more doubleheaders, added engine manufacturers for better performance, and the opportunity to expand into Canada.

Those all sound like good things to us.

Big Week for Industry Celebrations

If you’re a fan of industry events and getting a look at the near-future of the auto industry, aftermarket, and people who keep both alive, then this has sure been your week.

Two major industry events just wrapped up: the 2019 Tokyo Motor Show on November 4 and the 2019 SEMA Show on Friday. While they couldn’t be more different, each showcased emerging trends while highlighting enthusiast participation.

2019 Tokyo Motor Show

For those seeking wacky and wild concepts, Tokyo delivered. With cars that look like what our grandparents actually thought 21st century vehicles would look like to creations they never could have imagined; the biennial auto show ran the gamut. It also posted up record attendance this time around.

Electric powertrains dominated (no surprise there), as did the application of next-gen technology like autonomous driving, virtual reality infotainment, and unprecedented connectivity. Less expected was the representation of a new type of “van-life,” but we’re intrigued nonetheless. Of these far-fetched vehicles, the most likely to hit U.S. streets is the new Honda Fit.

Featuring five different trims, a newer, bubblier restyling and a brand new two-motor hybrid drivetrain, I could see this car appealing to urban-dwelling Americans someday. That day is probably not today but I feel my point still stands.

2019 SEMA Show

On the SEMA front, shifting technologies were in attendance though they didn’t take center stage. That was reserved for more of-the-moment trends, like overlanding and modern hotrodding. (Read more about our SEMA 2019 takeaways, here.)

While the SEMA show is a trade-only event, the last night’s SEMA Ignited “afterparty” is open to the public. With custom builds, celebrity appearances, drift demos, food, music, and fun, the closing event also features the exciting Battle of the Builders competition. And this year’s victory went to Jim and Mike Ring’s 1969 Chevrolet Camaro.

Featuring a complete redesign, the Ring Brothers’ Camaro sports a 100% carbon fiber body (widened by 4 inches) and a supercharged LS3-swapped engine putting out 890 hp.

Stay tuned throughout the upcoming weeks for more in-depth SEMA coverage, as we unpack new trends, crazy builds, and exciting new products.

UAW Negotiations Continue as Union Faces Government Oversight

While the deal between Ford and the United Auto Workers (UAW) looks to be just about finalized, the union still has more bargaining to do. Next up in their crosshairs is Fiat Chrysler Automobiles.

For FCA, this is less than ideal timing for labor negotiations, however.

Having just made its potential 50-50 merger with French automaker PSA Groupe public knowledge, the Detroit automaker will now have to juggle building that alliance with keeping workers in the factory. While labor experts see this as merely a bump in the road on the way to an eventual deal, they still feel the merger could be an “elephant in the room” during negotiations.

“People get nervous when you change the name of your company,” Art Wheaton, an automotive industry specialist at Cornell University’s Industrial and Labor Relations School tells the Detroit News. “It makes you nervous and ask, ‘Are you really here to invest in us?’ That can make it difficult at the bargaining table.”

That better be a pretty big bargaining table, however, because the UAW is going to need to make room for some elephants of its own.

Just last week, former UAW leader and GM director Joe Ashton was charged with bribery and accused of taking kickbacks—becoming the 13th UAW official (and highest ranking thus far) to be charged in the fed’s years-long corruption investigation of the union.

To put it plainly, this has not been a great look for UAW at a time when there’s a lot of eyes on them. While the organization undoubtedly does good work for many of its members, and has promised to root out corruption at the top, those same members must be growing tired of the negative headlines by now.

Beyond the frustration lies some anxiety, too.

Using something called a consent decree, the government could step in and seize control of the UAW, dictating future reforms and oversight. (A great example is what happened with the Teamsters union in 1989. The Teamsters were under that oversight for an astounding 25 years, pumping $170 million of its own money to investigate itself during that time.)

As we all know what happens when the government takes control of well…anything, it’s safe to say that’s a fate the UAW and all its members would like to avoid.

Around the Circuit

Monster Energy Series

Denny Hamlin locked up his spot in the Championship 4 with a dominating win in Sunday’s Monster Energy Series race. Hamlin’s win knocks defending champ Joey Logano out of title contention with his sixth win of the season, 27th of his career and second at ISM, setting up a battle with teammates Martin Truex Jr. and Kyle Busch along with Stewart-Haas Racing driver Kevin Harvick for the championship next week in Miami.

“I can’t believe it,” said Hamlin.“This race team worked so hard this whole year. They deserve to be there.”

The stage is set next week for the Championship series race at Homestead-Miami Speedway on November 17 for the Ford EcoBoost 400.

Xfinity Series

Justin Allgaier took advantage of pole-sitter Christopher Bell’s struggles to win Saturday’s Xfinity Series race for his first win of the season, punching his ticket to next week’s Championship 4 race.

Allgaier sped ahead of Bell (who was punished for a pit road speeding penalty and spun out) for the final 66 laps to take first place ahead of Cole Custer and Tyler Reddick over the weekend. He now joins the so-called Big Three of Bell, Custer, and Reddick in the Championship 4, winning the 11th race of his career in a helmet specially-designed by his 6-year-old daughter Harper.

“This is the first time I’ve won with Harper’s helmet in the car, and it means a lot,” said Allgaier. “To have the speed that we’ve had (this year) and not be able to pull it off has been disappointing. These guys have rallied behind it. We said when we came here that we need to come here and get a win so we could go to Homestead, and we did that.”

Allgaier will look to knock off Reddick for his second straight Xfinity series crown next week in Miami for the Ford EcoBoost 300 at Homestead-Miami Speedway on November 16.

Gander Truck Series

Stewart Friesen overcame a first lap penalty this weekend to lock up his second win of the season and of his career Friday night at ISM Raceway in Phoenix.

Despite being penalized for jumping the start of the race, Friesen rallied late and locked up his spot in the Championship 4 alongside defending series champ Brett Moffitt, Ross Chastain, and two-time series champ Matt Crafton next week in Miami.

“Great race car, great race team. We’ll all celebrate tomorrow, and then it’s game on,” said Friesen.

“We’ve got a badass piece for next week, too,” he promised, who will try for the title next Friday, Nov 15, at Homestead-Miami Speedway.