Changes are coming to the Indianapolis Motor Speedway because Roger Penske is not a quirky businessman.
Roger Penske was introduced yesterday as the next steward for the holdings of Hulman & Company, and fans immediately wondered whether the quirks and traditions of the Indy 500 and Indianapolis Motor Speedway would be sacrificed to help The Captain recoup his investment.
Not much was shared during yesterday’s press conference about the cost of the sale or plans for the future. This all came together very quickly with the Hulman George family deciding to authorize the sale on Sunday. Penske is walking the property today as he begins the process of evaluating his new business.
There are a few things we need to understand about Penske – he is a brilliant businessman because he has a unique ability to focus of what’s important and ignore what isn’t. He is a pragmatist who evaluates and invests in facilities and employees as assets. There is a love for the Indianapolis Motor Speedway that Penske indulges, but his business is about making money not owning it as an expensive hobby.
All assets, policies and procedures will be evaluated by Penske through the prism of profit and loss.
Given those truths, here are six predictions for the future of the Indianapolis Motor Speedway during the upcoming Penske Era:
- Cooler policy with change – When I first moved to Indianapolis, I was stunned that fans were (and are) allowed to bring coolers stuffed with beer and food from home. That means the IMS is forfeiting an river of money from concessions. Maybe the infrastructure required to provide food and drink for 300,000 people would be complicated to design and build, but let’s say that 200,000 adults are drinking beer and that they average six each. If beers cost $10, that’s $12-million! Add sandwiches or hotdogs, and the take increases. Penske is not in the business of forfeiting cash. One option that makes sense as a middle ground is to grant permits for coolers – or sell IMS licensed coolers.
- A 24-hour race will come to Indy – One of the first possibilities mentioned by Penske yesterday was the addition of a 24-hour race like Le Mans or Daytona – or 12 hours at Sebring. He wants to utilize the facility more often, and a 24-hour race doesn’t require a huge crowd to make financial sense.
- Indy will become the center of the racing universe – Penske spoke with reverence about the facility and its place in racing and entertainment. He wants the Indianapolis Motor Speedway to be the racing and entertainment capitol of the world, so it will. Penske is ambitious enough to dream, smart enough to execute, and has the resources to realize his vision.
- Full time IndyCar entries will be guaranteed a spot in the Indy 500 – Bump Day is fun because of the drama that occasionally leaves a full time IndyCar outside the fastest 33 cars. That means the visibility sponsors invest in cannot be delivered. That’s bad for business. Penske will change this policy because the potential for frustrating investors is not worth the fun for fans.
- Lights will not come to IMS – Penske was asked about lights yesterday and shared that there might be more productive ways to invest money to improve the fan experience. That means lights won’t come to IMS. A NASCAR night race would likely provide a short-term surge in ticket sales. But if the race is still a dog, the novelty wears off, and fans learn to ignore the lights as a contrivance.
- Acreage will be monetized – A big question Penske undoubtedly asked during negotiations – or during today’s walk-through – was about the revenue being generated by the golf course. The Pete Dye designed course is one of the wonderful quirks of the property. Four holes are actually in the infield of the Speedway. Does Penske want to be in the golf business? Is there a better way to monetize that property? Penske doesn’t own a golf course now, and there is likely a good reason for that.
Penske is a very decisive business owner, so expect some of these very logical changes to be implemented shortly after the deal closes in January.