State of the Series - Tony George, Bob Reif, April 11, 2000 GEORGE: ...Welcome to all the teams and drivers that are here preparing. Welcome to all of you. I don't know if this is going to be a state of the series as such, but we are going to...
State of the Series - Tony George, Bob Reif, April 11, 2000
GEORGE: ...Welcome to all the teams and drivers that are here preparing. Welcome to all of you. I don't know if this is going to be a state of the series as such, but we are going to talk a little bit about the Indianapolis 500, the Indy Racing League and the Indy Racing Northern Light Series. So there's a lot of interesting things we have in store, and I'd like to begin by talking about some of the new things that you'll see.
Some of you may be in around the last couple of days and taken some of it in, but our major capital program that's been underway for two years is starting to come to conclusion. It's been cleaned up a bit for this week. You know, it's going to be full tilt again probably next week for a couple of weeks until we really get ready to open for the month of May. But it's been a challenge, building all the new infrastructure into the facility, getting ready for the Formula One race in September. You know, building the tower's been a two-year project that's been started and stopped, started and stopped, and started and stopped as we clean up and prepare to receive 300,000 guests. But I'm very proud of the effort that all the contractors have put forth to make this, what looks to be a very impressive, brand-new facility. I think within another few years, we're going to have a completely new facility with all the rich history and tradition of the Indianapolis Motor Speedway incorporated into it. But it's going to be a facility unmatched by any other of the new facilities that have been built within the last few years. It is our largest project. It's cost us tens of millions of dollars to this point, and it's not finished. So we've made sure that we're investing in the right ways in the future of the Indianapolis Motor Speedway.
Motorsports has grown so much through the decades and we're positioning ourselves to be industry leaders going forward. I mentioned the Pagoda, the new tower, that's going to house Mike (King) who, by the way, does a very nice job. Thank you very much. But Mike and the Radio Network and the public address and safety and traffic are all going to be located in there. There are going to be operations that are located in the tower. Of course, timing and scoring and race control eventually will move into the new tower, but there's also going to be a couple of hospitality suites in there, which provide spectacular view of all the grounds and the city skyline.
The racetrack itself has been slightly reconfigured. The pits and paddock area, I'm sure you'll see, is taking on the look of a Formula One pit area. But for the 500 and the 400, we're going to have a lot of the same feel that we've always had with grandstand seating that has a similar profile to the lower half of the old tower terrace. It's right along pit road, so the fans can be close to the action and reach over the fence for autographs and what not. So it'll have a little bit of a new look, but it'll be, I think, very exciting as we kick off the racing at the Indianapolis Motor Speedway for the new millennium. On top of the garages that you see are the hospitality suites, which we hope to have open for May. We've done a good job of marketing them, selling them. Now we've got to make sure we have them to a point people can actually occupy them, but I'm sure we'll get that done.
Also, there's going to be some of the accessory buildings behind those Pit Row garages. There's going to be a new look back there where we have a two-story building, where the old media center was, the restrooms will be up on the top for the most part. Then the accessory rooms will be down below. Obviously for those of you in the media here today, the most interesting construction project, of which there are nine concurrently going on around the Speedway, you're most interested I'm sure in the new media center... which you're really going to be lucky if it's anywhere near finished because that project has been behind schedule for a long time to the tune of three or four weeks. But I'm sure they're working very hard and it'll be better by August and even better yet by September. But I'm sure they're going to work hard to make your accommodations the best they can be.
This is the fifth Indianapolis 500 since the inception of the Indy Racing League, probably the third I guess with the Indy Racing League actually sanctioning it. And whether it's been the Triple A or the United States Auto Club or the Indy Racing League, one thing that can be said is that all the races have been typical Indianapolis 500s. They've been very competitive with very interesting and great stories whether it's Buddy Lazier coming from his back injuries in 1996 at Phoenix to win his first 500 or the story of Eddie Cheever who is a struggling car owner but a very accomplished racecar driver... You know, put together a team, an operation that was not only given the opportunity to compete at the highest level but actually had the opportunity to win. And he did. And then of course, Arie Luyendyk winning his second and then leading very spectacularly last year before the very wily veteran made a very rookie-like mistake, you know, in his last race.
So there's a lot of interesting stories in the past. I'm sure there are going to be just as many stories this year with some of the great rookies we have here as well as some of the veterans who are looking forward to adding their name for the first or multiple times on the Borg-Warner Trophy. The Indy Racing League continues to develop; we had a very successful launch of our second generation, or next generation if you will, of the IRL specifications that have been in place for some four years now.
Very pleased with the abilities of our technical staff to be able to manage the needs of the sport from a safety standpoint, from a competition standpoint and from a reliability standpoint. You know, this package we have, it really works. There's not a lot of aggravation that goes with it, at least none that I experience. It... our goal is to put on an exciting competition on the racetrack so we can all focus on the other things we need to, as far as growing the sport and that takes some time. But it's easier to do when you have a very reliable package that works. So as we look to the future, we'll continue to look at the technical specifications and see what we need to do to continue to massage those and insure that they're doing everything that we like. We look to grow this series and the number of races.
We continue to have dialogue going forward in 2000, trying to put together our 2001 schedule. We have a lot of interest from a lot of racetracks that should allow us to accomplish our goals for 2001. We're very happy with the growth of the series with respect to sponsors. I think a lot of our teams, as obvious in Orlando, it was more apparent in Phoenix and I'm sure it'll be the case in Indianapolis, that more of our teams are finding funding. Some of it is sponsorship that is non-traditional. The motor sports are very excited to be developing these new relationships and providing new opportunity for people to come into this sport, their companies to get involved at a reasonable level, to realize good value for their contributions to the sport, to help us grow the sport and create more awareness.
There's probably no better case that supports that than our new series sponsor, Northern Light Technologies. I think that we're very fortunate to have sort of at the last minute, before we actually started the 2000 season, to bring Northern Light on as a series sponsor. Their CEO, David Seuss, who will join us, as I said, later today is a very enthusiastic partner. He has a great vision. He's been involved in growing companies. He' s retired. He's come back. He's a racer, and he understands the sport. He's been involved as a driver himself in Tran sAm and he wants to help us realize our objectives. We share the objectives in trying to grow this series, put fans in the stands and take our message out through the traditional outlets, through the media and whatnot, but also through the new media of the internet. So we're very excited about his involvement and his company's involvement. And we expect that the 2000 racing season for the Indy Racing League and at the Indianapolis Motor Speedway is going to be the best ever. So thank you all for being here. And we'll turn it back over to Mike.
MIKE: We're going to ask Tony to stick around and he's going to... I guess we' re going to open up the floor in just a couple of minutes for some questions. I also want to introduce a gentleman who's with us here today. And you hear the cliche or the phrase that "to make things happen, you've got to have good people" or "good people make good things happen." This is a relatively young man with... what Bob, you're 33? Is that right? You're 33 years old? With an incredibly impressive resume. Joined the Indianapolis Motor Speedway just a few months ago after a very successful stint with the Miami Dolphins. He understands what it's supposed to be like in the big leagues and knows apparently how to get it down. He had not been with the Speedway and the Indy Racing Northern Light Series for more than just literally a few weeks when the Northern Light Technology deal was announced. And in talking with David Seuss, you will hear him say how impressed he has been with Bob Reif and with the way the negotiations were handled. So another piece of the puzzle falls into place. And he is the Executive Vice President and Chief Marketing Officer here at the Indianapolis Motor Speedway and for the Indy Racing Northern Light Series as well, Bob Reif. Bob, if you want to come on up, and Tony if we could have you come back up as well so we could get some questions. And have you and Bob here and get you to share this microphone and we are recording this, so anyone who has questions, we'll give you the mike.
REIF: Thank you.
Q: Tony, what are the chances of having both CART and IRL events at any particular facility, say particular Nazareth and Milwaukee next year?
GEORGE: Having separate races, separate times of the year? I really don't have a feel for that. You know, there's been a lot of speculation in the media as to what way that might fall at some of the ISC tracks in particular, whether it's Phoenix or Nazareth or whatever, but it's very speculative, and I don't really comment on speculative things like that.
REIF: I can add to that, that we know where we want to race next year and if someone else wants to race there, that's out of our control.
Q: What are your impressions of the new Kentucky Speedway for the race coming up in August?
GEORGE: You know, I haven't been there yet. I've seen a few pictures, but not very many. They tell me it's very nice. I'm going to have try to get over there, but I think that the race is going to be wildly successful. I think there's a lot of race fans in the Midwest that... unfortunately we haven 't really tapped into. We've had a lot of race fans from the Midwest go to Phoenix and Las Vegas and Atlanta, but haven't... having more racing in the Midwest is something we need to try and do, and I think this is going to be a good start. And it sounds like it's going to be a first-class facility. We 're going to be looking very much forward to kicking off their inaugural season down there.
Q: Tony, with the season opener and the league opener at Disney and have been there for the last five years, what does it look like for 2001? Nobody knows where it's going to be at.
GEORGE: Well, we're still working on our schedule for 2001. And we're talking to everyone, including Disney. We're working to try to find a suitable date for that event. I think that's a big challenge with an organization like Disney who is in the entertainment business and the theme-park business. They tend to have a lot of crowds, and they have their own needs that they have to manage. You know, it's been a great facility for us and we don't want to... we don't want to not race there if it's at all possible. So we're looking. We're looking to consolidate or condense our schedule a little bit, you know, trying to start early in the year. Maybe not quite as early as January, but certainly early in the year and wind up a little sooner after Labor Day. So again, it may take us a while to get there. We'll continue to work on our schedule for this year, and we'll see where it sorts itself out at.
Q: In order to grow the schedule right now, it looks like you're going to have to have a good relationship with ISC. What's the relationship now between Indy Racing, ISC and can you say what tracks that ISC owns that you would like to go to?
GEORGE: We do have a very good relationship with ISC, there's no question about that. The fact that we only run at one facility that they operate is a temporary condition, so obviously, first and foremost on our list is Fontana. We'd love to have a race at Fontana and that goes back to the question asked earlier, you know. Could there be two races, each series racing at a common facility? And I don't know but certainly we want to race at Fontana. Or southern California. It may well be the case at some point in the future.
Q: Tony, can you give us a range of races you expect for 2001? Not a full schedule, obviously since you're not going to announce that, but approximately how many? Last year you said this year would be eight to 13. It ended up at nine. What does it look like for next year, just in numbers?
GEORGE: Probably in that same range. Hopefully between nine and 10 to 13 or 14. I think it's possible. It's certainly a lot of interest at this point, so we'll see if we can actually put some of them to bed.
Q: Bob, as where you sit as Chief Marketing Officer, how important was the addition of Northern Light?
REIF: Well, it was tremendous for us. Having the title sponsor and having a five-year television agreement gives a league stability. Now we're at the point of growth. So now that we've got a partner like Northern Light, that can see our vision and can access non-traditional media, we're in a good position and our teams will find out that Northern Light is going to help us promote the series and do the things that need to happen.
Q: Tony, there's been some talk about the German promoters, talking with you about going over there. Can you talk about that?
GEORGE: Well, we were the first ones that they came to visit when they started looking at building the facility, and we've been in contact with them for the last three years. Three or more years, I think. Now it's nearing completion, and the people that were responsible for building the track are kind of winding up their involvement and they've got someone in there to manage the facility and then actually put together the commercial enterprise. We have had some conversations with them as well as has CART and NASCAR. You know, my interest is... as the series grows, you know, we're looking at expanding our schedule and certainly we view the Indy Racing or the Indy Racing Northern Light Series as an international series with international flavor and competition, and racing offshore is something that is definitely going to be in our future at some point. When and where's not determined, but I did run into Hans over at Nazareth this past weekend and brought back a brochure of their progress to date, and it's an impressive facility. It's as they planned to build it. Looks to be a good market in that within 125 miles of the facility they have about 20 million people. So it would not be unlike locating a racetrack in New Jersey. So we'll just see where that goes. I think that if the right opportunity presents itself, Germany may be in our future.
Q: Mr. George, two weeks ago over at Homestead, Andrew Craig said that they would probably not keep May open again next year like they did this year so that the CART guys can come over here. If they don't do that, given the fact that only a couple of the CART guys have come over here this year... just your thoughts on the whole idea of opening up the 500 to those guys and the fact that they really didn't respond in the way that many of us felt they might.
GEORGE: I don't know how to really respond to that. I think they've obviously got to make decisions for their business based on their best judgement, whatever that may be. I don't know. But certainly, we plan on having a full calendar of racing activities in Indianapolis in May. I kind of view all the CART car owners as potential IRL car owners at some point in the future. So we'll continue to do what we do, and I'm sure this has been said for the past several months. They need to do what they need to do. You know, what that means for the future, I don't know. But we're going to continue to focus as I'm sure are they. So that's where that is.
Q: How's the Joliet facility coming along? Where do you expect it to fall on the schedule for next year? Early summer, late summer, August?
REIF: Well, Joliet is a beautiful facility. And as many people know we're in a partnership there with ISC. We're looking at a couple of dates and somebody mentioned the ISC partnership or the relationship and if you think that we're in a partnership up the road in Joliet, we've had to spend a lot of time with those folks over the past couple of months. So I think that relationship is strengthening. But we're looking at a few dates, and we're right now taking a look at the entire schedule. We want to be in a position where we can announce our schedule sooner than we did last year so that teams have the opportunity to go find sponsors, we have the opportunity for league sponsors, people can get their programs together and have a true off-season. So Joliet is going to happen... we're looking at two dates right now: one in July, another in September.
Q: Tony, how many... how long until you bump this series up in the terms of races? It seems like it's starting to fall off the radar screen of a lot of fans because the schedule, instead of growing has stayed stagnant or this year fallen back. And would 13 races next year be enough to get you bumped up and considered among the majors?
GEORGE: Well, I think... I don't know. It's a very competitive environment out there. I don't know that we've fallen off anyone's radar screen. I think we do need more events. We do need to be, you know, out there more weekends a year, more weeks a year with races and we're trying to grow that. But you know, I don't feel at all that we've gone backward. The fact that we have one less race or one more race than we had last year or two doesn't really concern me. We're looking for the right opportunities. And just to add a couple of races for the sake of adding them for numbers doesn't make sense to me. It's got to be a good relationship, a good partnership with the venue. So for whatever reason, Nazareth was talked about as a potential race for 2000. It didn't work out mainly because it wasn't a good, a viable business opportunity for one or both sides. So it's got to make sense. While there's been a lot of speculation that it's not working in Phoenix, I will tell you that it is working in Phoenix and it's going to continue to get better. And it's working to the point that we feel like we're going to have more ISC tracks. The problem you have with CART and IRL operating out there, they're being played off one another. And they're playing one another off each other with the promoters and it's... you know, creates an opportunity for insanity to sometimes start to fester. So I don't know how long that can continue. But we continue to plan to get stronger and start cluttering up the radar screen rather than be perceived by some as falling off of it.
Q: Bob, do you care to comment on this question?
REIF:: I just think that whether we have nine races or 13 races, what's important to us is consistency and growth. And we had the opportunity this year, we had two opportunities to be in markets. Nazareth was one of them, and Milwaukee was another. We're not interested in doing a one-year deal where we can have an event and then we have to leave town. That doesn't do anything for us and doesn't do anything for our consistency and our growth. We need multi-year deals in place. And that's where we want to be in a position to show everybody that we're consistent and here to stay. And that' s how you develop a fan base. That's how you get people to come to the races, because they know you'll be coming back year after year. You know, if you look at Phoenix, CART in its heyday wasn't much better than where we've been growing, and we've had 15 percent growth there this year. We're proud to say that. So we're proud of where we're going and we're going to continue to grow it. We just want people to know that.
Q: Either one of you gentlemen can answer this. Should the promotion of a race be done more by the track or the sanctioning body or working hand-in-hand perhaps is the best way in this day?
REIF: Well, I'll tell you, whatever works to sell more tickets... that's what I'm in favor of. I'm a fan of success. So if we can be successful by getting fans in the stands and we can do it, that's great. But we like people that are big boys and like to promote their races. And in some cases, we've got to do it ourselves. We are very flexible in making things work. And we believe we can sell our product better than anybody else can sell our product. So if we have to help folks do that, we've got the capability to do that. We've got the right people in the right places to make that happen.
Q: Thanks very much for being here.
REIF: Thank you.