NASCAR's Charter System: A Decade of Transformation and Emerging Legal Battles

The 2025 NASCAR Cup Series season marks a significant milestone, not only signifying a decade since the introduction of the ownership charter system but also ushering in the era of its second iteration and first extension. This new agreement, effective from 2025 to 2031, coincides with the start of a new television rights deal and has been immediately shadowed by legal challenges. Two teams have initiated a lawsuit alleging federal antitrust violations against NASCAR, stemming from the contentious negotiations surrounding the charter agreement’s extension.

At its core, the ownership charter system grants participating teams a guaranteed entry into every NASCAR Cup Series race, along with a predetermined revenue stream based on the terms negotiated prior to each charter period. The initial agreement spanned the 2016-2024 period, aligning with the previous television rights cycle. The current agreement, running from 2025 to 2031, mirrors the duration of the latest broadcast rights deal. This framework also mandates team participation in agreed-upon marketing initiatives and grants NASCAR the right to utilize team intellectual property for promotional purposes. While this description offers a foundational understanding, the system’s complexities and implications are far-reaching.

Teams have increasingly come to view these charters as akin to franchises in traditional North American stick-and-ball sports leagues, such as the NFL’s New England Patriots or MLB’s Los Angeles Dodgers. The underlying principle is that each car number represents a distinct, professional sports entity. However, a key distinction, and a central point of contention in the ongoing lawsuit, is that the NASCAR Cup Series model is not an equal partnership between the sanctioning body and the teams.

Currently, there are 36 ownership charters in NASCAR, each conferring a set of shared benefits derived from competing under the Cup Series umbrella. The most critical of these is the guaranteed starting position in every race, regardless of the number of entries on any given race weekend. This provides a level of stability and predictability for chartered teams that non-chartered entries do not possess. Much like franchises in other major sports receive shared revenue from collective television contracts and licensing agreements, NASCAR Cup Series teams benefit financially through the charter agreement.

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It is crucial to understand that the value of these 36 charters is not uniform. A charter’s economic worth is intrinsically linked to the performance of its associated car over the preceding two seasons. A team’s year-end payout is calculated using a formula that considers both the charter’s value and the team’s final standing in the championship. This performance-based valuation incentivizes teams to maintain a competitive edge, as success directly translates to increased revenue.

Beyond financial considerations, the charter system also provides teams with a voice in NASCAR’s decision-making processes, albeit indirectly. This aspect functions similarly to the Concorde Agreement in Formula 1, fostering a degree of dialogue between the sanctioning body and the teams regarding competition-related matters. This collaborative approach aims to ensure that significant rule changes and strategic directions are developed with input from those directly involved in racing.

Furthermore, a majority of the teams have consolidated under a collective entity known as the Race Team Alliance (RTA). The RTA operates its own media arm, Racing America, and maintains a dedicated negotiating committee that engages with NASCAR on various business-related issues. This unified front provides teams with enhanced leverage in discussions with the sanctioning body.

The maximum field size for a NASCAR Cup Series race is capped at 40 cars. This means that up to four teams without a charter can still qualify for and start a race. However, these non-chartered entries receive significantly less purse money compared to their chartered counterparts, highlighting the financial advantage conferred by charter ownership.

The very inception of the charter system was driven by the objective of creating a sustainable economic ecosystem within NASCAR. From the outset, NASCAR and the RTA collaborated to establish a model that would generate long-term value for team ownership and simultaneously foster competition for the acquisition of charters. The underlying theory was that by imbuing charters with inherent value, the prospect of selling them would become a viable exit strategy for team owners.

In previous eras of NASCAR, when a Cup Series team ceased operations, its assets often held minimal residual value beyond physical facilities. Race cars rapidly became obsolete, and equipment was frequently liquidated at steep discounts. The escalating valuation of ownership charters has, therefore, created a robust secondary market characterized by supply and demand dynamics.

The introduction of the Next Gen car, now in its fourth season, is intended to contribute to long-term cost containment. While its full potential in this regard is still being realized, the car’s design as a de facto spec vehicle—with standardized components except for engines and bodies—is designed to streamline parts procurement and reduce development costs as inventory builds and parts become commoditized. The theoretical benefit is that if the Next Gen car successfully reduces the cost of competition and future broadcast rights agreements yield greater revenue, teams may find themselves less reliant on sponsorship income for financial stability.

Each ownership charter possesses the flexibility to be leased to another organization for a single season within an agreement period, provided it is returned to its original owner at the conclusion of that season. The first charter agreement was in place from 2016 to 2020. The current agreement, active from 2021 to 2024, aligns with the broadcast rights held by FOX and NBC. The subsequent broadcast rights agreement, from 2025 to 2031, expands the television partners to include FOX, NBC, TNT, and Amazon Prime.

The total number of charters stands at 36, though NASCAR retains the discretion to alter this number, which would consequently impact revenue distributions. Since the charter system’s inception, numerous charters have been bought and sold, reflecting their established market value.

Detailed Charter Histories:

Trackhouse Racing No. 1: Awarded to Chip Ganassi Racing in 2016, this charter has been driven by notable drivers such as Jamie McMurray and Kurt Busch. Trackhouse Racing acquired it following its purchase of Chip Ganassi’s NASCAR assets after the 2021 season, moving Ross Chastain from the No. 42 to pilot the No. 1.

Team Penske No. 2: Consistently aligned with Team Penske’s No. 2 car, this charter began with Brad Keselowski and transitioned to Austin Cindric upon his move to the Cup Series.

Richard Childress Racing No. 3: This charter has remained with Richard Childress Racing and the No. 3 car, driven by Austin Dillon throughout its tenure.

Front Row Motorsports No. 4: Initially associated with Stewart-Haas Racing’s No. 4, driven by Kevin Harvick and later Josh Berry, this charter was sold to Front Row Motorsports in 2024. The transaction faced legal hurdles, becoming a point of contention in a lawsuit against NASCAR. Noah Gragson is the current driver.

Hendrick Motorsports No. 24: This charter originated with Hendrick Motorsports’ No. 5, driven by Kasey Kahne, and was renumbered to the No. 24 when William Byron graduated to the Cup Series in 2018.

Team Penske No. 12: This charter’s history includes Roush Fenway Racing’s No. 6 and a subsequent lease to JTG Daugherty Racing before its acquisition by Team Penske to establish their third entry for Ryan Blaney.

Kaulig Racing No. 16: Awarded to Tommy Baldwin Racing in 2016, this charter has seen multiple ownership changes, including Leavine Family Racing and Spire Motorsports, before being purchased by Kaulig Racing. Drivers like AJ Allmendinger have been associated with this entry.

Legacy Motor Club No. 42: This charter began with Richard Petty Motorsports as the No. 9, evolving through various numbers and ownership structures, including GoFas Racing and Petty GMS, before becoming the No. 42 under Legacy Motor Club. John Hunter Nemechek is the current driver.

23XI Racing No. 35: This charter was previously associated with Stewart-Haas Racing’s No. 10, driven by drivers like Danica Patrick and Aric Almirola. Its transfer to 23XI Racing in 2024 was part of the ongoing legal disputes. Riley Herbst is the 2025 driver.

Joe Gibbs Racing No. 11: This charter has been consistently aligned with Joe Gibbs Racing and the No. 11 car, driven by Denny Hamlin since its inception.

23XI Racing No. 23: Originally Germain Racing’s No. 13, this charter was sold to 23XI Racing in 2021. Its chartered status is currently under review due to the team’s lawsuit against NASCAR. Bubba Wallace drives the No. 23.

Trackhouse Racing No. 88: This charter originated with Hendrick Motorsports’ No. 14, driven by Tony Stewart, Clint Bowyer, and Chase Briscoe. It was sold to Trackhouse Racing following Stewart-Haas Racing’s downsizing, with Shane van Gisbergen taking the wheel.

Haas Factory Team No. 41: Initially awarded to Michael Waltrip Racing and quickly sold to Stewart-Haas Racing, this charter has a lineage including Kurt Busch, Daniel Suarez, and Cole Custer. It remains with the rebranded Haas Factory Team.

RFK Racing No. 6: This charter began as Roush Fenway Racing’s No. 16 and was renumbered to the No. 6. It has been driven by Trevor Bayne, Ryan Newman, and is currently piloted by co-owner Brad Keselowski.

RFK Racing No. 17: This charter has been with Roush Fenway Racing since its inception, driven by Ricky Stenhouse Jr. and more recently by Chris Buescher.

Joe Gibbs Racing No. 54: Evolving from Joe Gibbs Racing’s No. 18, previously driven by Kyle Busch, this charter is now associated with the No. 54 and Ty Gibbs.

Joe Gibbs Racing No. 20: This charter has been consistently linked to Joe Gibbs Racing and the No. 20, with drivers such as Matt Kenseth, Erik Jones, and currently Christopher Bell.

Team Penske No. 22: This charter has remained with Team Penske and the No. 22 car, driven by Joey Logano throughout its history.

Spire Motorsports No. 7: Awarded to BK Racing as the No. 23, this charter has been with Front Row Motorsports, leased to Rick Ware Racing, and is now with Spire Motorsports. Justin Haley is the current driver.

Hendrick Motorsports No. 9: This charter began as Hendrick Motorsports’ No. 24 and was renumbered to the No. 9 when William Byron took over the No. 24. Chase Elliott has driven the No. 9.

23XI Racing No. 45: Originating as Richard Childress Racing’s No. 27, this charter was leased to StarCom Racing before being sold to 23XI Racing. Its chartered status is also subject to the ongoing legal proceedings. Tyler Reddick pilots the No. 45.

Richard Childress Racing No. 8: This charter began as Richard Childress Racing’s No. 31 and evolved to the No. 8. It has been driven by Daniel Hemric, Tyler Reddick, and is currently driven by Kyle Busch.

Wood Brothers Racing No. 21: This charter began with GoFas Racing’s No. 32, was leased to and then sold to Wood Brothers Racing. Drivers have included Ryan Blaney, Paul Menard, Matt DiBenedetto, Harrison Burton, and most recently Josh Berry.

Spire Motorsports No. 71: Possessing the most complex ownership history, this charter began with Circle Sport Racing and has passed through various teams, including Leavine Family Racing, The Motorsports Group, GoFas Racing, and Live Fast Motorsports, before landing with Spire Motorsports. Michael McDowell is the 2025 driver.

Front Row Motorsports No. 34: This charter has been consistently with Front Row Motorsports and the No. 34 car. Its chartered status is also part of the antitrust lawsuit. Todd Gilliland is the 2025 driver.

Rick Ware Racing No. 51: Originally Front Row Motorsports’ No. 38, this charter was sold to Rick Ware Racing in 2019 and has remained with the team through various car numbers. Cody Ware is the 2025 driver.

Trackhouse Racing No. 99: This charter began with Chip Ganassi Racing’s No. 42 and was acquired by Trackhouse Racing when it purchased Ganassi’s assets. Daniel Suarez drives the No. 99.

Legacy Motor Club No. 43: This charter originated with Richard Petty Motorsports as the No. 43, underwent a period with Rick Ware Racing, and is now with Legacy Motor Club. Erik Jones has driven this entry since 2021.

HYAK Racing No. 47: Awarded to JTG-Daugherty Racing, this charter has consistently been associated with the No. 47, driven by drivers like AJ Allmendinger, Ryan Preece, and currently Ricky Stenhouse Jr. The team has rebranded as HYAK Racing for 2025.

Hendrick Motorsports No. 5: This charter started as Hendrick Motorsports’ No. 48, driven by Jimmie Johnson, and was reassigned to the No. 5 upon Johnson’s retirement. Kyle Larson is the current driver.

RFK Racing No. 60: This charter began with HScott Motorsports and has been with Premium Motorsports and Rick Ware Racing before being leased to RFK Racing for Ryan Preece in 2025.

Joe Gibbs Racing No. 19: Originally awarded to Michael Waltrip Racing and immediately sold to Joe Gibbs Racing, this charter has been associated with the No. 19, driven by Carl Edwards, Daniel Suarez, and Martin Truex Jr. Chase Briscoe will take over driving duties in 2025.

Spire Motorsports No. 77: This charter originated with Premium Motorsports’ No. 62, was leased to HScott Motorsports, sold to Furniture Row Racing, then Todd Braun, and eventually Spire Motorsports. Carson Hocevar is the current driver.

Kaulig Racing No. 10: Formerly Furniture Row Racing’s No. 78, this charter was sold to Spire Motorsports and then to Kaulig Racing. After being associated with the No. 31, it will be renumbered as the No. 10 for Ty Dillon in 2025.

Front Row Motorsports No. 38: Awarded to BK Racing as the No. 83, this charter was leased to TriStar Racing before being sold to Front Row Motorsports. Zane Smith will drive the No. 38 in 2025.

Hendrick Motorsports No. 48: This charter began as Hendrick Motorsports’ No. 88, driven by Dale Earnhardt Jr., and was reassigned to the No. 48 when Jimmie Johnson retired. Alex Bowman is the current driver.

The ongoing legal challenges underscore the system’s evolving nature and the significant financial and operational implications for all stakeholders in the NASCAR Cup Series. As the sport navigates this new charter era, the intersection of business, competition, and legal precedent will undoubtedly continue to shape its future.