One brick at a time, Champ Car moving forward without the IRL
by Mark Cipolloni

 August 2, 2006

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2007 Panoz DP01 Champ Car should be the future IndyCar as well
Mark Cipolloni/AutoRacing1.com

After being saved from bankruptcy by Kevin Kalkhoven, Gerald Forsythe and Paul Gentilozzi, this past weekend was the second most important event in Champ Car's history.  It isn't just the launch of the new Champ Car that made this weekend a watershed moment for Champ Car.  It's much more than that.

This past weekend Champ Car put a stake in the ground, right in front of the line they drew in the sand.  With the launch comes orders for new cars from existing as well as new team owners.  Collectively they said that this, the new Champ Car formula, is the future of open wheel racing for them.

It's too late now for there to be a merger of the IRL and Champ Car.  The opportunity for the two sides to agree on a common formula is now lost.  Once the substantial investments are made in the new Champ Car, there is no turning back.

A merger would mean a compromise on the car, and that would mean spending more money for another new car in a sport where money is tight already.  So unless the IRL side is prepared to adopt the new Champ Car formula, and there has been no indication they would be, a merger simply isn't going to happen, no matter how hard Kevin Kalkhoven and Tony George try, or say they are trying.

Champ Car is signing new contracts for races in Las Vegas, China, Phoenix and other locations. Meanwhile the IRL is moving forward with a race in Iowa and making noises in San Antonio, Detroit and Montreal.  In fact the IRL has had talks with NASCAR about racing in Montreal, displacing Champ Car, and Champ Car has swooped into San Antonio and tried to beat the IRL to the punch.

Does that sound like two businesses trying to merge?  To the contrary.  With friends like that, who needs enemies?

For whatever reasons, and I am not privy to what they were, Kevin and Tony simply were not able to come to a meeting of the minds.  Kalkhoven said a merger had to happen by August if it were to happen, and August 1st is past.  He knew the new Champ Car would be launched, the last weekend in July, and with it there would be no turning back.

And to be honest with you, I think both Tony and Kevin are okay with that.  The IRL has Danica Patrick and Marco Andretti, and they have the Indy 500.  In Tony's mind we doubt he sees enough benefit to the merger or it would have happened by now.

Likewise, we sense that Kevin and Champ Car feel they have turned the corner and the new Champ Car, along with new team owners, venues and sponsors, will be the shot in the arm to propel them to an exciting future.

Will a merger happen?

Although it is curious that Brian Barnhart would go to the Panoz factory to see the new Champ Car, we think it may have just been a curiosity thing more than a sign that a merger is imminent.  From what I have been told, the chances of a merger have been way overblown by the media, and although they are still talking, it's a very long way off.  If I were a betting man, I would say 2009 or 2010, and that's assuming Honda exits the sport.  If they continue to supply engines to the IRL, the split might go on forever.  However, I do expect Honda to leave the IRL if there is no merger.  The real question is whether they will stay to the end of their contract, or pay the IRL to break it early like Toyota did.  I do know that Honda is not happy that a merger did not happen.

And then of course there is Roger Penske with his sweetheart Ilmor deal whereby he rebuilds all the Hondas for the IRL.  If Honda were to bolt, I predict Roger will propose that Ilmor supply the IRL engines.  However, without factory support Tony George might finally be compelled to reach a merger deal.

As I wrote years ago, it will be too hard for the two leagues to completely merge initially, and I proposed a two league system with some joint races.  This would require common equipment.  Although Tony George feels some obligation to Dallara because they have done a good job in building cars for the IRL, there is some speculation that because the new Champ Car Panoz has ex-Lola personnel involved on many levels, the quality issues that plagued the Panoz IRL car will not be an issue with the new Champ Car and that might be a common chassis platform for open wheel racing starting in 2008 or 2009. 

My guess is that Champ Car is counting on racing the DP01 for three years minimum - through the 2009 season.  Then if there is a merger with the IRL, say in 2010, a new 'common' car based on the DP01 or a modified version called the DP02, could be agreed to by both parties.

If a common car can be agreed to, then comes the issue of engines.  Here there are two scenarios - 1) Honda goes away and both leagues adopt the turbo Ford Cosworth with Tony George given an equity position in Cosworth, 2) Honda agrees to bring their CART turbo engine out of mothballs and it becomes Honda vs. Ford with some restrictions in place to ensure fair competition.  There is no way the Champ Car side will agree to standardize on the existing IRL engine as it is far too loud for street races.

If a merger never happens

If a merger never happens, both the IRL and Champ Car will struggle to gain significant market share, and if each side can at least break even financially, I suspect we could see the two leagues co-exist indefinitely.  However, I doubt that both can maintain a profitable business in the current economic environment whereby NASCAR is sucking the sponsorship well dry.

I do know that Champ Car is positioning itself to be self-sustaining long-term.  All the moves that they are making are to ensure the business has a long and healthy future.  Is it all in place yet?  No, remember Kalkhoven said it would take 5 years to complete and that each move would be a step in that 5-year plan.

If either side thinks the other will eventually fold, they are seriously mistaken.  I see positive signs that both leagues are making progress and building for their future as if there will be no merger.  And while everyone in the industry wants to see a merger, I think at this point we are looking at 2010 at the earliest.

And if the two sides do merge one day, it will be a pleasant surprise, but don't lose sleep over wishing for it.

The author can be contacted at markc@autoracing1.com

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