On Tuesday (May 28), the Stewart-Haas Racing team dropped startling news on NASCAR aficionados, stating that the organization would shutter itself and become a closed chapter in the history books. For a four-car team to basically evaporate is confounding, surprising, and out of line with contemporary sports metrics.
This feels akin to McLaren suddenly ending its racing in Formula 1, or a professional team in any of the major sports deciding to stop playing and sell off the parts. One of the things that makes sports franchises coveted is how few of them exist and the built-in equity that accompanies them.
The charter system was meant to bring stability to NASCAR and with that stability, economic sturdiness. In some ways, it has, but the business of selling charters, especially for teams in the back half of the field, has become a game within a game. But teams in the top half have yet to liquidate, illustrating the promise of an organization that is solidly run. While SHR suffered through some sponsorship losses and has not been as dominant as it had been, it was still a sought-after seat in the garage and a team with name recognition.
Historically speaking, this demise is coming after the landscape has already been settled. Stick with me here. When the National League came into existence in 1876, a re-birth of the National Association of Professional Base Ball Players, it started the trend of legitimizing professional sports leagues. Eight teams played in the 1876 season, but over time, teams came and went, playing two or three seasons and then folding, with only two of the eight still existing today, Chicago and Boston (now Atlanta). By 1892, 17 teams had folded, illustrating the difficulties of running an organization in the early professional landscape.
The NFL fared no better. Formed in 1920, the NFL faced strong competition from the college game and struggled to grab the attention of the US public. Because of its uncertain existence in its early years, the league also saw teams come and go at a rate more alarming than in baseball. By 1952, 49 franchises had become defunct, five having won NFL championships and the last being the Dallas Texans after the 1952 season.
Both MLB and the NFL stabilized and grew value in their franchises. Since 1899, MLB has not seen a team go out of business, much like the NFL has not seen one since the Texans. What the leagues do instead is move teams into better opportunities, something seen…
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