NASCAR: Can state’s top sport rev up its economy?
Virginia tries to capitalize on soaring popularity of raciing

by Rod Belcher
for Virginia Business
October 2006

It’s a big race weekend in Martinsville, and business is booming an hour away at the Caution Flag, Dwight and Pat Hanna’s racing collectibles store in Roanoke. In their parking lot are cars from across the United States and beyond. “Last year we had people come from Newfoundland,” says Pat Hanna.

She explains that hotels in Southside Virginia fill up quickly when NASCAR’s Nextel Cup Series comes to Martinsville Speedway. As a result, thousands of fans pour into Roanoke, spending money on meals, lodging and the Caution Flag’s die-cast NASCAR model cars, which sell for $65 to $70 each. “Our sales are 25 to 30 percent higher when the races are going on,” Pat Hanna says. “Martinsville is a good weekend for us.”

In fact, NASCAR means good business for companies large and small throughout the commonwealth. Virginia is host to four Nextel Cup races (two each in Martinsville and Richmond) and another two occur just across the state line in Bristol, Tenn. No other state has more than three Nextel Cup races within its boundaries. (In addition to a Nextel Cup race, a NASCAR race weekend can also include a Busch series car race and sometimes a Craftsman truck race or an International Race of Champions event.)

NASCAR is by default the state’s only major league sport. The Virginia Squires of the old American Basketball Association are a faded memory. Attempts to recruit baseball, football and hockey teams in recent years have failed. But state and local officials have begun to see NASCAR’s status in the state as a virtue. With the help of then-Gov. Mark R. Warner, the Richmond area competed vigorously last year to be the site of the NASCAR Hall of Fame before losing to Charlotte, N.C. In addition, Warner began the Virginia Motorsports Initiative, a wide-ranging economic development program aimed at using education programs and research facilities to recruit a variety of motorsports companies and create jobs.

In following this strategy, Virginia is riding the rapidly rising national popularity of NASCAR. The sport has outgrown the Southern redneck image lampooned in Will Ferrell’s hit movie, “Talladega Nights: The Ballad of Ricky Bobby.” NASCAR is now a marketing powerhouse, with 75 million fans (up 19 percent since 2000) and television sports ratings that rank second only to NFL football. “There are more people at a Nextel Cup race than at any Super Bowl, and the Super Bowl is a one shot a year event,” says Jack Berry, president and CEO of the Richmond Metropolitan Convention and Visitors Bureau. “We have racing multiple times per year.”

For two weekends a year, the ninth largest locality in Virginia is a race track. Richmond International Raceway consistently sells out its 107,000 seats for Nextel Cup races, creating a population that rivals Portsmouth’s. The track is undergoing a renovation that will result in a net gain of about 5,000 seats by May, pushing total capacity to 112,000.

The streets around RIR take on a campground atmosphere during race weekends as RVs, campers and cars from across the nation fill every available space. Fans dressed in shirts and hats promoting their favorite drivers stroll about the RIR complex. They attend tailgate parties and catch up with their extended “NASCAR family,” friends whom they see at the races around the country. RIR officials estimate that the two NASCAR events and an annual Indy car race pump an estimated $200 million into the regional economy. “The tide floats all boats, and we bring the tide,” says Matt Becherer, director of marketing and sales for RIR.

Gov. Timothy M. Kaine got a firsthand look at what RIR does for the tide of public opinion. The Democrat attracted national press attention in January when he answered President Bush’s “State of the Union” address on behalf of his party. Nonetheless, since he became governor, “I have never had more calls or received more mail about anything I have done than when I stood at RIR and said, ‘Gentlemen, start your engines,’” says Kaine.

The governor credits Warner, his predecessor, with finding new potential in Virginia’s ties to motorsports. “It is, of course, a major tourism draw for us,” Kaine says. “But we also see motorsports as having an economic development component and an education component, as well. Mark Warner started many initiatives and programs to that effect.”

Motorsports could play a role in the Kaine administration’s economic strategic plan, scheduled for release this fall. The governor says that he sees the industry as an important economic driver for Southside Virginia, which is recovering from the loss of thousands of textile and tobacco jobs. He also is interested in having a statewide study done on the economic impact of NASCAR.

Efforts to leverage Virginia’s strong ties to NASCAR and other types of auto racing include the Virginia Motorsports Initiative, announced by Warner at Martinsville Speedway in 2003. The program tries to capitalize on the fact that Virginia is home to 37 race tracks offering several levels of stock car competition in addition to road racing and drag racing. The initiative seeks to attract race car teams and their suppliers, such as engine fabricators, by offering financial incentives and job training programs.

In addition to creating motorsports jobs, the state wants to promote auto racing as a laboratory for new technologies. “There are technological implications that go far beyond NASCAR,” says Steve Bridges, marketing manager for the Virginia Economic Development Partnership. “Performance improvements for race cars trickle down to commercial vehicles,” he explains. “The possibilities for development of industrial technology breakthroughs are significant.”

One facility proposed for more motorsports research is the Langley Full Scale Tunnel (LFST), a 30-by-60-foot NASA wind tunnel at Langley Air Force Base in Hampton. Old Dominion University’s Frank Batten College of Engineering and Technology operates the LFST. A smaller, 14-by-22-foot tunnel is administered by a NASA contractor, Jacobs Sverdrup. Both tunnels are used for testing automobile designs; the larger tunnel allows for testing at wind speeds of up to 200 mph.

ODU entered an agreement in 1997 with NASA to operate the larger tunnel as a commercial enterprise. “As a part of the agreement, ODU was precluded from competing with NASA for aerospace testing and subsequently identified the motorsport industry as a viable customer base,” says Eric Koster, director of motorsport operations for LFST.

Feasibility tests conducted on an air scrubber at LFST contributed to the development of a carbon monoxide removal unit designed to improve race-car safety. The new technology (a joint project involving Penske Racing South, NASA, ODU and Smoke Mask) made its debut in Dodges driven by Ryan Newman and Brendan Gaughan at the Pontiac Performance 400 race at RIR last year.

“ Right now, NASCAR teams are putting cars on pallets and shipping them to Europe to have the kinds of tests done that we can do for them at Langley,” Bridges says.

Linked to the wind tunnel work at Langley is another economic development program, the Virginia Institute for Performance Engineering and Research (VIPER) located at VIRginia International Raceway in Halifax County. VIPER combines ODU’s wind tunnel research with work by Virginia Tech’s Advanced Vehicle Dynamics Laboratory and the Danville-based Institute for Advanced Learning and Research, created to help promote economic development in the Southside. “VIPER is all about Virginia Tech collaborating with ODU,” says Bridges. “You’ve got two giants working together in the middle of the state on aerodynamics, engine dynamics, chassis dynamics, fluid dynamics and materials engineering for things like tires and components for cars. We’ll have commercial research as well as master’s and Ph.D. candidates working on their own research and ideas. There are just so many possibilities for technological and industrial advances to be made here.”

In support of its VIPER activities, ODU will offer a master’s degree in motorsports engineering beginning next year, says Koster.

The VIPER facility broke ground in November. VIR also houses the RacePlex Motorsports Industrial Park. The park provides tenants trackside locations from which they can develop motorsports products. Motorsports companies that already have facilities at VIR include Sasco Motorsports and Synergy Racing. “We’re trying to make Halifax County a place where race teams want to relocate,” says Josh Lief, general manager of VIR.

One race team that has relocated to Southside Virginia is HT Motorsports. It operates the No. 59 Dodge in NASCAR’s Craftsman Truck Series. The race team announced in 2004 that it was moving from Harrisburg, N.C., to Martinsville to be near the speedway and become a tenant of the $1.2 million, 50,000-square-foot Virginia Motorsports Technology Center.
Arrington Manufacturing built the center, which includes a training facility for Patrick Henry Community College’s motorsports students. Arrington builds 60 to 70 racing engines for Dodge trucks each year. “Arrington is working with Patrick Henry Community College to offer an associate’s degree in applied science with specialization in motorsports technology,” says Crystal France, director of marketing and public relations for Martinsville and Henry County. “The program will educate and retrain residents to be able to go into very technical jobs in the motorsport industry.”

France says the presence of Martinsville Speedway also has helped the area attract companies that are not directly related to motorsports. “Knauss Snack Food Company opened here in 2002,” she says. “They had almost settled on Marion County, S.C., as the location for their new facility. However, they were in discussions with ... Jeff Hensley for a sponsorship. Jeff used to race in the Busch series, and he encouraged them to look at Martinsville. They employ 143 people locally.”

The Martinsville race track has an estimated impact of $30 million to $40 million on the region on a race day. “It stimulates a lot of business,” says speedway President W. Clay Campbell.

He remembers one unidentified entrepreneur who took advantage of a missed opportunity on one race weekend. Campbell says that a bank across the street from the race track typically rents its parking lot to race fans. But one time, he says, “someone forgot to do it. Well, by mid-day on race day, some enterprising guy had put up a sign and was selling parking spaces. The bank never had a clue.”

MARTINSVILLE SPEEDWAY
1 Speedway Road, Martinsville
Next Nextel Cup races: Oct. 22, 2006; April 1 and Oct. 21, 2007
Opened: 1949
Track: 0.526-mile concrete and asphalt oval
Owner: International Speedway Corp.
Seating capacity: Approximately 60,000

RICHMOND INTERNATIONAL RACEWAY
600 E. Laburnum Ave., Richmond
Next Nextel Cup races: May 5, Sept. 8, 2007
Opened: 1946
Track: 0.75-mile asphalt oval
Owner: International Speedway Corp.
Seating capacity: 107,000 (112,000 by May)

BRISTOL MOTOR SPEEDWAY
151 Speedway Blvd., Bristol, Tenn.
(2.5 miles south of the Virginia state line)
Next Nextel Cup races: March 25, Aug. 25, 2007
Opened: 1961
Track: 0.533-mile concrete oval
Owner: Speedway Motorsports Inc.
Seating capacity: 160,000

DODGE WEEKLY SERIES TRACKS
The series is a semi-professional and amateur racing series sanctioned by NASCAR

Division I
• Langley Speedway, Hampton (0.395-mile asphalt track)
• Motor Mile Speedway, Radford (0.416 mile, asphalt)
• South Boston Speedway, South Boston (0.400 mile, asphalt)

Division III
• Old Dominion Speedway, Manassas (0.375 mile, asphalt)