NASCAR Agrees To Permanent Team Charters

What’s Happening?

Per its settlement with teams 23XI Racing and Front Row Motorsports, NASCAR will provide the sport’s 15 charter owning organizations with permanent, or “evergreen” charters, a change that these teams have requested since the start of negotiations in late 2023.

NASCAR’s charter system sits on a fine line of complexity and simplicity. 

On the surface level, 15 teams own a combined 36 charters that allow them a share of revenue with NASCAR and automatic entry into every Cup Series race.

Beyond that, there are small details to the structure of the charter system, much more crucial to those who own these charters.

One of these small details, the permanence of charters, was a point of contention during the latest negotiations of the charter agreement. 

While charters may seem similar to those franchises found in other major league sports, such as the NFL, MLB, or NBA, NASCAR’s charter system is based upon a negotiated agreement between NASCAR and its teams.

Furthermore, the system that NASCAR chose could go away at the conclusion of each agreement’s term. Of course, NASCAR would likely open a new can of worms had they ever dismantled the system, but this hypothetical scenario is no longer a problem for teams or NASCAR.

NASCAR’s teams will get their permanent charters as part of the breakthrough settlement in the 23XI Racing and Front Row Motorsports antitrust lawsuit against NASCAR. The exact details of the agreement have yet to be confirmed, but the two sides have dropped key details.

The teams will have their six charters (which they lost due to not signing the 2025 charter agreement) returned for 2026. But, most crucial of all, a statement from 23XI, FRM, and NASCAR, the parties claimed that the settlement agreement features “a form of ‘evergreen’ charters, subject to mutual agreement.”

“As a condition of the settlement agreement, NASCAR will issue an amendment to existing charter holders detailing the updated terms for signature, which will include a form of ‘evergreen charters,’ subject to mutual agreement. The financial terms of the settlement are confidential and will not be released.”

This term was utilized throughout the lawsuit, and while there could be some narrow differences from permanent charters, 23XI Racing lawyer Jeffrey Kessler confirmed to the media that these evergreen charters are “forever.”

Furthermore, these charters are not applicable just to 23XI Racing, as all 15 charter-owning teams in NASCAR will be presented with an updated draft of the 2025 NASCAR Charter Agreement featuring this stipulation.

The Importance of Permanent Charters

Though it may seem easy to assume NASCAR would follow the lead of other major sports leagues, like the NFL, MLB, or NBA, in giving out some form of permanent franchise, NASCAR is privately owned, with the sport’s founding family, the France family, sitting atop the sports corporate ladder.

Throughout the charter negotiations that began in December 2023, NASCAR’s teams wanted the security that their charters would be retained beyond the 2025 Charter Agreement, and its potential extension at the conclusion of a seven-year term.

Though this was a hot-button issue for teams, they did not receive this in the final draft offered on September 6, 2024. That agreement, somewhat controversial and often brought up during the trial, was signed by 13 of the 15 charter owning teams, with 23XI and FRM left as the two holdouts.

Part of the reason the team did not receive this stipulation is the sport’s opposition, including that of NASCAR chairman and CEO Jim France. During the past 10 days of trial, when asked about the viability of permanent or evergreen charters, France often cited industry uncertainty as a reason to withhold permanent charters.

While this could still be France’s stance on permanent charters, this settlement was seen as a way to move forward for the betterment of both sides and, most importantly, the sport itself. As NBA legend Michael Jordan said on the courthouse steps:

“In all honesty when you get to the finish line sometimes you have to think, not just for yourself, but you got to think about the sport as a whole, and I think both parties got to that point, and we realized that we could have an opportunity to settle this and we dove in and we actually did it.” — Michael Jordan

Though the sides have settled, the details are still rolling out. Check out the article linked below for key updates as they are available.

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