NASCAR.com’s David Caraviello writes that top athletes in much less dangerous sports than NASCAR’s Sprint Cup are paid a lot more for their ability. Here’s a sample of his rationale:
Here’s a little secret: comparatively speaking, drivers are underpaid, sometimes vastly so. To their credit, none of these guys are going to complain. Jimmie Johnson took home $7 million for winning the championship last year, and by all accounts was quite satisfied with it. To the many drivers who came from humble beginnings, NASCAR is a gravy train that’s made them rich beyond their wildest dreams. But in most cases, the race winnings haven’t kept pace with the rising costs of the sport. Purses have been relegated to pocket change. Other athletes are taking home a lot more money, without ever having to put on a helmet and fireproof suit.
While Caraviello’s column is interesting, I think he fails to give credence to fundamental market truths, and to acknowlege the trend among top drivers, which is to pursue a wide range of investments and wealth-building opportunities. Consider that:
1. What someone is paid for his/her service or labor is the point at which supply meets demand. It’s no different in NASCAR. Drivers and owners negotiate contracts. When there’s a meeting of the minds, there’s a contract.
2. Myriad endorsement opportunities add another lucrative dimension to a driver’s total compensation package.
3. NASCAR drivers aren’t complaining. That should tell us something.
4. The new compensation trend for NASCAR’s most sought-after drivers is ownership percentage in a team, and other investments, some in racing, some not.
Sprint Cup drivers don’t get enough credit for being savvy businessmen. Even the retired drivers are realizing there’s a market to be tapped. Just look at what’s ahead for my favorite retired driver, Darrell Waltrip, aside from his broadcasting career.
