Friday, May 11, 2007

Jr. leaving Dad’s company (Dale Earnhardt Jr. moving on)

In SportsBusinessNews.com’s decade long history the most significant story in terms of content generation was the death of Dale Earnhardt. A seminal event in NASCAR history, the death of the larger than life Earnhardt became a defining point in the evolution of NASCAR as a sport from niche status to a full fledged mega industry. The news Thursday, that Dale Earnhardt Jr. simply referred to as Junior by everyone connected to NASCAR (out of respect to the connection father and son had to each other and to the sport they helped grow) did the expected and left his father’s company.

“We're calling this press conference here today to announce that after a year of intense negotiations and intense effort on behalf of Dale Earnhardt, Incorporated and JR Motorsports that we've decided it is time for us to move on and seek other opportunities to drive for a new team in 2008.

“We've both worked extremely hard to find a common ground, but as the negotiations continued, one thing became evident, we both want to be and get to the same place, but we both simply have different visions on how to get there.
“Because DEI means so much to me, I felt it was best now for both of us to start focusing on our future so that we both could come out of this successfully. Trust me when I say that DEI will come out of this successfully. Teresa and Max Siegel are taking the necessary steps to bring DEI back to one of the front-running NASCAR teams.

“However, at 32 years of age, the same age as my father was when he made his final and most important career decision, it is the time for me to compete on a consistent basis and contend for championships now. What team I drive for next season, I don't know, we'll see what opportunities I have. We'll see who wants to hire me, who is interested for me to drive their race cars, and we'll decide from there. That is an announcement, obviously, for a later date.

“Today I want to say with complete sincerity that it's been a privilege to drive for DEI, and it will continue to be a privilege throughout this season. It's really all I've ever known. We've grown together, we've won together and we've lost together. It is important for me that my father's legacy continues.

“I would like nothing more than DEI to continue its building its future around good people, hard work and relentless determination. The same characteristics that were so evident in the man who built the place. We will continue to work together on many projects that will benefit both DEI and JR Motorsports, and the legacy of my father.

All the while, it is time for me to continue his legacy and the way I only know I can, by taking the life lessons that he taught me: Be a man, race hard and contend for championships. Since that is what I plan to do, I feel strongly that I would have my father's blessing.
“If I may speak openly to my fans, my dad's fans and fans of DEI and all of the people who watch NASCAR racing each weekend, please understand that my decision is one I make for my career. I make it in the utmost -- I make it with the most utmost respect to your loyalty and support. My motivation to climb in the race car each week is to satisfy my fans and give them what I feel they deserve.

“I want to also thank some of my family members for being here today to support me. Obviously, my sister (Kelly sitting beside Jr.), my mother, Brenda, and my grandmother, Martha Earnhardt and my Aunt Kathy. All of my family has been really supportive throughout this, and I want to thank them for that. So we'll open it up to any questions you guys might have for me or my sister.”

Given that Junior thanked everyone but barely mentioned his father’s second wife Teresa Earnhardt (was left the company by her husband and Dale’s father after his death at the 2001 Daytona 500) you didn’t have to read between the lines to surmise the relationship between Junior and his father’s second wife must have been fractured for years. Junior’s sister by his side, his mother (Dale Earnhardt’s first wife) and other members of Junior’s immediate family were in attendance in a show of solidarity, one that left Teresa on the outside looking in with control of Dale Earnhardt Incorporated but little if anything else.

“While we are very disappointed that Dale Jr. has chosen to leave the family business, we remain excited about our company’s future. Our aggressive expansion and diversification plans have not changed. This company has continued to thrive since Dale left us in 2001, and it will thrive following today’s announcement. Dale and I built this company to be a championship-contender, and those principles still apply. Dale Earnhardt, Inc. will win, and we have other extremely talented drivers and hundreds of employees that are dedicated to the programs we founded. This company has a great legacy and a bright future, built on loyalty, integrity, and commitment.” Teresa Earnhardt said in statement released following Junior’s announcement.

“Obviously, our No. 1 priority was keeping Dale Junior and we’re disappointed,” said Max Siegel, president of global operations for D.E.I., who attended the news conference as well to the New York Times. “I think that there’s always been a real possibility that he could go somewhere and there were other options. Everyone remained extremely committed to the process.

“Much like Dale Junior, we’re exploring all the opportunities to enhance our company, to grow to four cars and to be strong in competition and diversify the company.”

Teresa Earnhardt remains very much in control of the key marketing resources associated with her late husband’s legacy. Those assets include the rights to market and sell Dale Earnhardt’s image. One other asset DEI remains in control of the number 8 that has been associated with whatever car Dale Earnhardt Jr. has raced in for many years.

“It would be awesome to continue driving the number 8, but those numbers are obviously owned by the car owners and that is probably something that Teresa would prefer to have stay at DEI. I'm assuming that that's probably what will be the case.” Junior offered at Thursday’s media session. Junior is likely correct in suggesting Teresa likely intends to keep the right to the number 8 but what good it will do DEI remains to be seen. At the heart of any successful marketing program are consumers feeling good about that product. By denying Dale Earnhardt Jr. the benefits associated with a number and brand his success has built does a disservice to NASCAR and the legacy of Dale Earnhardt. The real question NASCAR fans will be asking “Shame on Teresa for not allowing Dale’s song the right to his racing number, what would Dale think”. Teresa can’t win either way, but given that Dale Earnhardt’s son is leaving his company the fate is number 8 is unfortunately tied to the troubled relationship.

“Dale Earnhardt Jr. leaving D.E.I., that’s a huge story,” said three-time Cup champion and broadcaster Darrell Waltrip, who attended the press conference told the New York Times. “I bet there’s a lot of car owners licking their chops right now.”

“Well, the most classic statement that I’ve heard, and it came from Tony Stewart: ‘What’s D.E.I. without Dale Jr.? A museum,’ ” Waltrip told The New York Times. “And that’s a pretty good analogy, I would say.”

Junior sat and answered question after question. One issue raised and one that remains difficult for non NASCAR fans to appreciate the amazing loyalty NASCAR fans have with their favorite drivers.

“Well, I don't think my fans have to worry about that part of it. I'm disappointed, So I expect my fans to be disappointed. Obviously, I know a lot of my fans wanted me to stay at DEI and continue driving for DEI, So I expect them to be disappointed in that aspect of it.
“Again, hopefully I can go accomplish the things that I want to accomplish and put on the show that I think I can put on. Give my fans more to celebrate. I feel like over the last years or two I've short changed my fans. They've been very loyal and sticking behind me when we haven't been able to put up the result that's we feel like we're capable of doing.
So I'm hoping to win some races and win some championships to give those guys what they paid all that money to go see us for.”

For his part Dale Earnhardt Jr. made it clear the decision wasn’t an easy one, and while he wouldn’t name names he did reach out to others before making his decision.

“I don't really want to name names. I talked to a lot of people just about everybody. You know, I've been in this sport for a long time, and I've got a lot of relationships with owners and people within NASCAR itself. You know, when my father passed away, that dependency on advice and information started going in a lot of different directions. Dale Jarrett and Bobby LaBonte were two of the guys that I would go up to and ask about a track or a line I'm running or the way my car drives or maybe a personal problem I'm having at home or something to do with my family. How am I supposed to handle certain things? And for the most part I've found a good group of people that I can really trust and that I feel can shoot me straight.

“I take that information and talk to my sister about it. We're both; this is really uncharted territory for me and my sister. And we're both trying to make the right decisions and what's in the best interest of me. I try to keep my sister's best interest at heart. And even though I try -- even though some of my decisions, some of the things that I decide and want aren't exactly in line with her beliefs. But we try to do the best we can to compromise each other.

“But it's important for me to be able to, you know, seek advice from certain people that I trust and be able to keep that personal and private. I feel like if I was, you know, I feel like those relationships are gone if I start to, you know, discuss, you know, the advice of the people themselves. That's why I go to them, because it's private and it's trusted information.
“So, you know, none of those things really effected my decision. They just sort of backed up some of my beliefs and where I felt like I was right or wrong. I've always had a real hard time knowing what kind of weight I carry in the sport. And through other drivers and my sister, and other employees of mine, I've been able to sort of come to an understanding of what that is and what that means. And that's helped me make the decision. But nobody and I can tell you no one person has convinced or swayed my opinion as far as the decision I'm making today and whatever decision I make in the future.”

Jeff Gordon appears poised to capture his fifth NEXTEL Cup, but its Junior who remains the most popular NASCAR Cup driver, the sports most marketable star and a NASCAR driver every NASCAR owner (except Teresa Earnhardt) will be very interested in talking to Junior about signing with their team.

“I drove for DEI my entire career. It's been successful and been a lot of fun. We've had a lot of -- we've done a lot of great things and I believe that company will continue to do good things and continue to surprise people.

“I'm going to miss a lot of the relationships within the shop itself and the individuals that work there. They have my full support, mentally and what not. But the other half of me is really excited about what my opportunities might be and what lays out there, you know.
“We're just going to, we sort of have carved this out between me and my sister. We worked really hard to come to an agreement with DEI, and that was what we focused on throughout the entire negotiations. Me and her haven't had a moment to really sit down and talk about what our opportunities are. We will certainly start to seek those out and see where we feel we would be most comfortable. But I don't really -- I've never been in this position before, so I don't know what to expect, and we'll just have to deal with each bridge as we cross it.”

A better question as Dale and Kelley sit down and negotiate where Junior will be racing next year will be whose ready to offer the biggest paycheck be a determining factor?

“I think there's not one team out there that's going to lay a dollar figure in front of you that's any different than anybody else. They all probably can do about the same, so the money's not really the issue. It's not the guy that gives me the biggest paycheck. It's the person that I feel like will allow me to accomplish what I want to accomplish throughout my career on the racetrack, in this shop itself, with my employees and our company.

“It has to be something that will complement my efforts here. Because I feel like we will be able to do something to complement their efforts with our drivers and our mechanics as they improve and move up the ladder, it will provide whoever my employer might be, with some talent at the cup level. It's more about, you know, there are some things that you can't get with money. You know, peace of mind and satisfaction in what do you every day and who you are and why you're doing it, and who you're doing it for.

“I'm seeking, you know, to have that peace of mind and that comfort to be able to really be an asset to somebody. So that's what -- I want to go somewhere, really make some things happen for somebody and have that appreciation go back and forth there.”

One intriguing choice, Earnhardt Jr. acknowledged the real possibility Junior could head to Richard Childress Racing, with the very real possibility an Earnhardt could be driving the number 3 car in the not too distant future.

“There’s a lot of logical -- there's a lot of logical scenarios that people are going to put together. We saw -- we've seen quite a few scenarios over the last couple of days that were kind of amusing. Some bright and some not so bright. But you know, I have a great relationship with Richard and I feel like on his behalf, that he stepped his programs up. He's made a great effort to improve and be as good as his teams can be.

“But I don't know whether -- I got to do a little soul searching about how I feel about driving a Number 3 car. That doesn't change my opinion of whether I would go drive for Richard or not. I don't have to drive the Number 3 car. But I don't personally know whether that's what I want to do, specific to that number. I need to really sit down. Because like I said, I'm going to make this decision once. So I have to really ask myself if I want to be driving that number the rest of my career.
“With respect to my father, I don't feel very comfortable with that. He made that number what it is. With respect to him, I believe that it belongs to him, you know what I mean? I never say never, and I've told you guys before that I was interested in doing that but later in my career, and I still feel like that. I still feel that way. If that's something Richard's interested in, we can explore that, but that's a long way down the road. And again, I'm just going to, like I said, I'm going to listen to everybody who wants to talk and form my decision from those discussions.”

One issue Dale’s sister Kelley tried to make clear on her brother’s behalf, at the end of the day she and her brother are still Earnhardt’s.

“We're still Earnhardt’s. We still have a relationship with Teresa and Kerry and Taylor. For whatever the future holds for us as participants in Dale Earnhardt, Incorporated, there's lots of years to figure that out. And Dale and I both want to be very supportive of Dale Earnhardt, Incorporated and their efforts because it is our family name as well. So we will do everything we can to support their rebuilding that team and the efforts that they're putting forth to make that team successful.

“From a timing standpoint, it's just the time for us to prepare for 2008, and this decision had to be made because of that, for both sides. DEI needs to move forward with what their plans are for 2008, and so do we. So the timing was a situation where if we couldn't come to terms we both felt best just to move forward.”

NASCAR is a very close community and that includes the media who cover NASCAR on a regular basis. One observation made at Thursday’s presser, how at peace Junior seemed with himself and his decision (a message that was easily conveyed on the Speed TV telecast of the media conference).

“Yeah, you know, it's hard to say what's been the hardest part, the hardest thing to deal with in my life. We've had a lot of great things happen, but we've also dealt with some tragedies. I was very sad earlier today. It was really hard talk to go the employees, talking to my team, I don't expect those guys to understand fully.

“I told them whatever their opinions and emotions were is fair, however they react and what not. I told them that I wanted to run as hard as we could run the rest of the year. It was important to me that we ran as good as we could run. I think that we owe it to DEI to give our best effort each week. And I hope that they would feel the same way.

“I mean, talk to go the employees as a whole, you know, was just really, really difficult for me. But I feel very comfortable with my decision. I just don't expect everyone at DEI to fully understand, you know, why we or how we came to this. I can't really speculate or guess on, you know, what individuals might be interested in what we're going to do in the future. I guess that would be a case-by-case basis and whatever opportunities might be out there for them, I support my team, my guys no matter what they do. What they choose to do, just as we support DEI in the future.

“Like Kelley said, the company is still part of our family. It's what my father built and conceived with his hard work, and we want to see it succeed and be successful. This decision is made today based solely on my driving career, not my, you know, not my personal interests in my involvement with DEI and what not. You know, we still want to see that company work and succeed.

“I'll just have to see what's out there for us. We've got to sit down and decide what we want to. Do we're going to listen, and it doesn't cost anything to listen, so we're going to listen to whatever wants to have a conversation with us and move from there.”

Still one has to wonder if Dale Earnhardt would have ever imagined a company he created in large part as a legacy to his children, especially his namesake who is one of NASCAR’s best would feel about two of children (Dale and Kelley) leaving DEI?

“Obviously I think -- obviously, I feel like his vision, and he said it himself, was for me to have a huge role in the company itself throughout the negotiations I felt like me and Kelley came to the understanding that that was not in the cards, you know what I'm saying? So it may be in the cards 20 years down the road. It may be something that happens. But from a driver's standpoint, and from where I feel I am as a driver and what I want to do and what I want to accomplish, this is a decision I made today.” Earnhardt Jr. commented.

For Sports Business News this is Howard Bloom

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