(by John Oreovicz espn.go.com 7-2-09)
INDIANAPOLIS -- In March 1994, Indianapolis Motor Speedway CEO Tony George announced plans to create a new racing series that would preserve the traditions and excitement of American open-wheel oval racing, using the Indianapolis 500 as its centerpiece.
The Indy Racing League staged its first event in January 1996, and after a 12-year struggle, eventually put its unacknowledged competition, the CART/Champ Car World Series, out of business, gaining sole control of what is generically known as Indy car racing.
Fast-forward to the present, and what became known as the IndyCar Series bears little or no resemblance to George's stated goals when he formed the IRL. And now George is no longer even in charge of the league he founded.
An IMS announcement late Tuesday stated that George was being removed from his dual roles as president and CEO of the Speedway and of Hulman & Co., the multifaceted business started in 1850 by Tony's great-great-grandfather, Herman Hulman. Effective immediately.
What the IMS press release did not reveal is that George elected to stand down as the leader of the Indy Racing League.
"He chose not to continue as CEO of the IRL," said Fred Nation, executive vice president of communications for the Indianapolis Motor Speedway. "He is no longer active in the management of any of the companies. He is on the board of directors of all the companies, along with the other members of his family. And of course the board is the ultimate decision-maker."
George was unavailable for comment.
No matter how his actions have been interpreted, even long before the IRL ran its first race, George always maintained that he was not interested in leading the sport.
"It is often said that I was, or am, motivated by power and greed in forming the IRL," he wrote in a five-page letter to the editor of The Indianapolis Star on Oct. 16, 1995. "I can only say it as simply as this: My desire is not now, and never has been, control of CART, IndyCar or the entire series of whatever cars run in the Indianapolis 500 … far from wanting to run the sport, I'd love to see even the IRL develop an autonomy. There is much I would like to do in my life, but I'll be unable to enjoy any of it if the '500' is not secure."
Since the IRL absorbed the remains of the Champ Car World Series in February 2008, George has been the de facto leader of American open-wheel racing. But just when it appeared he had finally grasped the brass ring after a 12-year struggle, he seemed to want to let go. Even though he was perceived as the winner of the CART/IRL war, TG never stepped up into the role of front man.
And while the future of the Indianapolis 500 is likely to remain secure simply because of the event's tradition and stature, the prospects for the sport of IndyCar racing are anything but stable.
The long, bitter struggle for control between the IRL and CART/Champ Car left IndyCar racing decimated, as fans, drivers, sponsors and manufacturers deserted the sport in search of a less political atmosphere. IndyCar racing's critics have long complained about a lack of leadership at the top level of the sport, and now with George's decision to step aside and focus on his own team, Vision Racing, that assessment is more accurate than ever.
George has rarely presided over the day-to-day operations of the IRL, leaving those tasks to Terry Angstadt, president of the league's commercial division, and Brian Barnhart, who is in charge of competition and racing operations.
Angstadt, who joined IMS in 2001 and assumed his current role in 2007, is generally credited with doing a good job for the IndyCar Series in an economic crisis of historic proportion. Barnhart, who has been a key member of the IRL since it started, is a more controversial figure, heavily criticized for the IndyCar Series' recent decline into a spec-car series with processional racing as well as his attempts to micromanage the on-track action.
Both are solidly entrenched in the IRL hierarchy, yet neither is considered a candidate to be the outright leader of the IndyCar Series. And that's the key problem that IndyCar racing faces: If Tony George is not willing or able to be the leader of the sport, who is?
Beyond that, the management shakeup at the IMS and IRL creates serious questions about the long-term financial stability of the sport. It's widely believed and been reported that George invested millions of the Hulman-George family trust fund into the creation and operation of the IRL -- some sources believe more than half a billion dollars. That supply of ready cash is likely to diminish considerably, if not dry up completely, despite statements to the contrary by George's mother -- IMS and Hulman & Co. chairman of the board Mari Hulman George.
"These changes underscore our family's commitment going forward to all of our companies, especially our commitment to the growth of the Indy Racing League and the sport of open-wheel racing," she stated in Tuesday's release. "We believe the Hulman-George family's long stewardship of the Indianapolis Motor Speedway, beginning in 1945, and our significant investment in the Speedway and in the IRL demonstrates that we have full confidence in all of our companies and that we intend to grow them in the future."
What Tony George and his family discovered during the IRL era is that operating a racing series is an extremely expensive proposition, especially when that form of racing has been devalued by a prolonged political battle. But there was plenty of historical evidence out there to provide warning signs.
CART, which ironically was formed in 1979 to address concerns about the Hulman family's prior stewardship of the sport under the guise of the United States Auto Club, burned through an estimated $300 million war chest, generated by an initial public offering, in about six years.
CART filed for bankruptcy in 2003, citing the following "special factors": a downturn in the economy, which resulted in reduced corporate promotional and advertising expenditures; decreased attendance at some venues attributed to the split with the IRL; the departure of two of the series' three engine manufacturers, followed by several key teams financed by those manufacturers; and the loss of several key venues along with the substantial sanctioning fees they generated.
Those conditions required CART to expend significant amounts of capital on entry support programs and team participation payments. CART also began self-promoting events to maintain key race markets, resulting in additional multimillion-dollar losses. Finally, CART also lost a significant revenue stream when it was forced to buy airtime and/or bear production costs for its race telecasts.
The IRL has been following that exact same path to destruction.
So now, the IRL is facing the overriding key issue that ultimately led to CART's demise: Who is going to run the show? In its 25-year history, CART never did find the right person who could manage the company and serve as a dynamic front man for the sport.
Bruce McCaw, who owned the PacWest Racing team that competed in CART from 1994 to 2001, said he believes that CART did have a strong leader during its most successful period in the 1990s -- ironically, the time span in which relations with the Indianapolis Motor Speedway deteriorated, prompting George to create the IRL.
"I think we did have a great leader in Andrew Craig [CART CEO from 1993 to 2000], but the board and the team owners made it impossible for him to succeed," McCaw said. "That was the big challenge for Andrew. After that, we never had the right people to lead it."
George's weaknesses as a public speaker are well known, but at least he had his family's 60-year association with the Indianapolis Motor Speedway and Indy 500 as a basis for why he should be considered for a leadership role for the sport as a whole. There really aren't any similarly qualified candidates out there.
This year, the Indianapolis Motor Speedway kicked off a three-year-long "Centennial Era" celebration set to culminate in May 2011, with the 100th anniversary of the first Indianapolis 500.
But at this juncture, IndyCar racing's fans and participants can only hope that their downtrodden sport still exists in some shape or form by then.