CART/Cosworth Press Conference June 16, 2002 An Interview With: Chris Pook Ian Bisco Jimmy Vasser Keith Wiggins Emerson Fittipaldi Part 2 of 2: Questions from the media Q Has the franchise board approved this? Chris Pook: The franchise...
CART/Cosworth Press Conference
June 16, 2002
An Interview With:
Part 2 of 2: Questions from the media
Q Has the franchise board approved this?
Chris Pook: The franchise board has approved it. The Delaware board approved it. The Delaware board instructed management to proceed with a business plan for the company that would stabilize the company and give us the ability to look towards the future.
We are obviously in pretty serious conversations with the Ford Motor Company. I won't say anything more than that at the present time. But they're exciting and fun conversations. We are very optimistic about our relationship with that organization. But we'll talk to you about that later.
If I may take the opportunity, I think it's really important for you all to understand the genesis behind this decision.
For whatever reasons, CART changed its engine formula last October. It changed in October having said to the manufacturers over a year before that, that by March of 2001 they would tell the manufacturers involved what the engine formula would be for 2003 onwards. They missed that date. Then they got themselves into a box as to what the formula would be. So eventually they decided they would go with the normally aspirated V8 engine, the same engine that is used in the IRL. That was in retrospect a bad decision. But be that as it may, that was the decision that was made.
My administration decided to create a common chassis with the IRL to try and give our teams flexibility and good economics to be able to run in both series, and to give the manufacturers involved a greater quantity of clients, so that in turn would bring the cost down.
We were summarily rejected on that. We put it out as an olive branch to try to form some type of compatibility with the other side to bring us closer together to see if we could merge the two together. But the olive branch was broken off in two pieces and we were slapped around the face with it and told to get out of town.
So we did that. We've done that. We're now going to -- management now is taking this company under full control, and we're going to run the company the way we want to run it, the way of board of directors want it run, and the way the team owners want it run. That is the genesis behind this decision to go back. We went back immediately to one of the most reliable partners that this company has ever had, and that is the Cosworth group, owned by Ford Motor Company.
And the leadership for that decision rests with Gerry Forsythe. He deserves all the credit and the praise for that. He tried very hard to convince his colleagues back last October this was the way to go. They didn't listen to him, for whatever reasons. He convinced me sometime ago this was the way to go. He reconvinced me in Milwaukee, when they were there, this was the way to go. We have had really, really good energetic and enjoyable discussions with Cosworth since that time, culminating in today's announcement to you.
Going forward in the future, because it's no use making a decision for today and the next two years if you don't know where you're going after those two years. And where we are going is quite simple. In the next six months we will talk to the world's manufacturers, Ford obviously among them, and the other manufacturers around the world and decide what is the best engine maker for this series. Is it a V8? Is it a V10? Do we stay turbo-charged? Do we got normally aspirated? All the various things.
We want to hear from the world's engine manufacturers, automobile manufacturers, what is the best situation for them, recognizing that they recognize what a great marketing platform this series has for them. We'll get their input, then we will arrive at the right engine decision by the end of the year, the 1st of January next year.
We will talk to our chassis manufacturers and decide what is the right chassis for this series going forward. We'll put that out in the marketplace in the first six months of 2003, with a target start date of 2005. That gives plenty of time to the manufacturers.
When these manufacturers told CART that they can't react in a few months to major changes, we need to recognize and respect what they're saying to us. And they can't. They need a year and a half at a minimum to get programs through their system. It's not just designing and building the engine, it's the whole process: it's the philosophy of the decision to go, it's the economics to fund the decision to go, it's the marketing department that has to be involved to understand how they can market and sell cars around that decision.
And we need to respect that, and we will respect that, so that we can build the relationships that need to be built between this company and the automobile manufacturers. And then those that sign up in 2003 with us to start the 2005 season, in 2004, we'll start discussions about how we integrate the marketing programs for 2005 going forward with them.
So this is not just a stop gap. This is a very clear-cut decision by management. I'd like to equate it to, if there's a racing car team that has lost its track and is not getting good times, what it's doing, it's running confused, what they do is they go back to a basic, they go back to a base platform and then they start again.
Well, this is no different than that. We are going back to a base solid proven platform with friends we know and we trust at Cosworth, and we're going to build it going forward for everybody's benefit. And that includes Cosworth, CART, the chassis manufacturers, the drivers and the sponsors. And we're going to bring value back into this series and we're going to deliver value for everybody involved in this series as a result of bringing the costs down to a sensible investment level where people can see a direct return on their investment and they can measure that return on their investment.
Very shortly you'll see another announcement from us concerning the increase of network television. That's where we are. Just one thing about television. I just looked over there and saw the man responsible, Terry Lingner, for the quality of television that we have today. Terry and FOX have made a solid commitment to this company, and if you look at the quality of television that's been emerging over this year so far, that's the man responsible for it, that's a man who is dedicated and passionately believes in what he does. It shows on the television screen.
Week after week this show gets better and better. And he has been given the mandate by FOX, who is by far the most aggressive and successful media company in the world, to deliver a solid quality product to the viewers. We're not after quantity. I keep saying this over and over again. Quantity will come; quality must come first. So quality television, quality engine program, quality racing that CART has proven it has over the years.
Adam Saal: If that doesn't answer everybody's questions, we'll continue.
Q I can't remember my question (laughter). Ian, can you give us a ballpark on one point five, one point three? Has it been decided yet?
Ian Bisco: I think we're looking at bringing it down to a little over a million for the teams per car.
Q Compared to like this year, maybe three-five or four?
Ian Bisco: This year typically is in the three to four range per car, yes.
Q Chris, last week at Laguna, John Judd was telling us he was two weeks away from his engine being ready to fire up. Will you try to take care of him financially? What will happen?
Chris Pook: We are getting our arms absolutely around John Judd. Again, with help from our good friends at Cosworth, we are in those discussions with John. We respect John very highly. Anyone know where his MG finished (At Le Mans)? He makes a very good engine. He won the 24 hours of Daytona. Makes an excellent engine. He's a solid citizen. He's well-liked in our industry, and he's well-respected in our industry. We absolutely are sensitive to that and conscious to it. As I said, we'll put our arms around him, embrace him into the program.
Q On the entrant support program. Engine lease costs, freight, hospitality. Is the majority of this going to be in that kind of way rather than in actual dollars, ways of reducing people's costs? Will all the teams participate? What can you tell us about how this is going to actually operate?
Chris Pook: It will be a combination of both, it's cash and in kind savings for them. But it is a totally level playing field across the board for 20 racing cars to participate in this series. Then when it comes to -- we want to really put 20 base out there with two more, so 20 plus two. 20 will participate in the incentive package you see on an equal basis. The positions 21 and 22 will participate in the overseas travel. So we won't penalize them from going to all the races, but they will not get incentives when they're in North America.
And the reason we want to keep it at 20 and 22, 22 actually is quite simple, because many of the urban racetracks we go to, we have a space problem, we can't get everybody fit in, in an effective, professional manner. So we want to respect those promoters who have those space problems in the key major markets to which we go. Secondly, when we fly, if we go above 22, it requires us to buy a third airplane. That doesn't make economic sense to anybody. That's where we are. Let me remind you, the word is "quality" and not "quantity".
Q As you say, it will be equal.
Chris Pook: No haves, no have nots.
Q Same deal for each team?
Chris Pook: Absolutely. Then it gets down to the ability of the team to extract the maximum from the engine and chassis package by using their technical expertise and their driver's ability.
Adam Saal: If you look at the number that Ian quoted, a low one million number, one point five million, from the ESP program, you can see there's definitely a balance there that will certainly help the teams.
Q You've already tested the 3.5-liter engine. What will you do with that engine?
Ian Bisco: I think the cost related to the three and a half liter engine is something that will remain separate to the turbo program. What we do with that engine, we'll have to decide. Probably got a nice little street car it will fit in actually (laughter). I don't think that's an issue we're too worried about at the moment. I think we need to concentrate on the turbo engine and make sure that we're well-prepared and that we get that running, that it's to a stage, you know, where everybody can compete and be equal and we get the reliability that we're confident that we're going to get out of it.
Q What changes will you be looking to make from the current formula that you are running in the 3.5-liter engine?
Ian Bisco: The specifications, we're looking at reducing the rpms on the engine to what we currently run. Primarily the thing that controls the life of the components in the engine are rpms.
You know, I don't think it's any secret that most of the manufacturers are running about 16,000 rpm at the moment. I think if we can reduce those rpms, then you can actually make the parts last longer. So one of our primary tasks will be to reduce the rpms, not sort of as low as the fact that the engine sounds bad or it loses its sort of glitz as a racing engine, but just so that we can get the life out of it that we need to get. Naturally, if you reduce the rpms, you bring the power band down a little bit. We'll deal with that by probably increasing the boost so that we can have a number that we feel that we can give good, safe racing on ovals, and also maintain the thrill that we have on the road courses and street courses that we race on.
Emerson Fittipaldi: As a driver, I was watching yesterday the cars going by. I mean, that's plenty of power. Even reducing the revs is going to be plenty of power and it's going to be great to watch and great to drive.
Q Chris, have any new teams committed to run for next year under the new formula?
Chris Pook: We have not asked for commitments from new teams yet. What we're asking for is commitments to our existing teams, giving them the opportunity to sign up first, and we will then pass on the application form to the new teams.
Is there interest from new teams? Absolutely. Are these new teams funded? We're asking to see their funding before their application is given to them. A couple of them are already funded, one of them is very close to funding. So we feel very good about it. But I must say to you, the first thing we must do is respect the guys that are running in the series first. That is the most important thing to do.
Q Is there a deadline? What sort of time frame are you talking about?
Chris Pook: We would like to be able to publish our teams within 60 days. That's where we want to be.
Can I just go back to the engine situation again, the normally aspirated engine, three and a half liter engine? With all due respect for Judd and for Cosworth with developing that engine, you've got to recognize that we are basically in July right now. We would be getting these engines to the race teams probably at the end of December - beginning of December. Then we have to go testing. If we had a hiccup with those engines, we have left ourselves with no window whatsoever. We have spring training starting the beginning of February, first race third week of February. We would once again be putting ourselves in a corner with not much out.
So one has to be sensible about these things. One has to evaluate all these things. With all due respect to the engineering capabilities of Cosworth and Judd, I didn't feel it was a prudent risk with all the other unbalance that was going on. So, you know, you minimize your risk in these situations, and that's what we did.
Q It seems this gives CART some control over the engine. Correct me if I'm wrong, it will give you the opportunity to perhaps develop an integrated engine chassis downforce package. Another thing that occurs to me, for example, one of the reasons we're running traction control right now is that it wasn't necessarily that traction control was good. Can you talk about all the other aspects in addition to just the engine.
Ian Bisco: I think that's absolutely right. I think the benefit of having the control of the engine and the power characteristics enables us in CART to work together with the chassis manufacturers to actually get the best package that suits different tracks and get the best type of racing. It's no secret that we go to some tracks and we have too much power, we have to burden the cars probably in some ways that we don't really want to that affects the racing. I think will give us the opportunity to perfect both the engine power and the chassis package so that we can get the best out of the race and make the cars race better and give the drivers a better opportunity to pass. Once again, I think it's a win-win.
Q Will there be different engine formulas for road and oval tracks?
Ian Bisco: That is going to be quite likely, yeah. Although, what we don't want to do is get into different specs for every different track. I could well see a different specification for an oval versus a road course or a street course.
Chris Pook: At the end of the day, we're going to manage our business ourselves and not be managed by others. That's what we're both saying to you.
Q Are there going to be restrictions on teams and engine use?
Ian Bisco: We'll do whatever it takes. We're probably looking at a minimum of one engine per weekend.
Chris Pook: We have to be sensible here. If we're going to bring the price of running a race car down to six million or six and a half million as a sensible budget for these teams, we have to put some disciplines in place. Again, we have to manage the business.
Q Is this a good business decision for the company?
Chris Pook: Absolutely. Absolutely. This is a sensible business decision for this company. And you look at that business decision, along with all the other things we've been doing in the company with our marketing programs, the way we're approaching it and creating the right environment for companies to come here and do business and get a return on their investment, I think you can add it up that two and two will make four here. Lately it's been making three and five.
Q The support program is something you're looking at for two years or is it more permanent?
Chris Pook: It's absolutely in place for two years. As I said earlier, we're going to sit down here now in the next six months and start talking to all the engine manufacturers -- automobile manufacturers, not engine manufacturers, automobile manufacturers and listen and find out what works for all of them. We haven't done enough listening around here. We've done a lot of charging down the road, you know, falling flat on our face and wondering why we tripped up. We're going to do some listening. These people are in the business of making automobiles, and they're in the business of selling automobiles. And these people are in the business of making engines, and we're going to listen to them, what they've got to say. We're not in that business. We're a sanctioning marketing organization. We need to listen to people who are in areas of their business where they have expertise. We need to digest that. And we build from there.
Q Will there be some CART races in May next year?
Chris Pook: Why would there not be?
CART/Cosworth press conference Part II