Lowe's, one of the last remaining corporate giants in NASCAR, announced Wednesday that it will not sponsor seven-time champion Jimmie Johnson after this season, an ominous sign for the nation's top racing series.
For Johnson and Hendrick Motorsports, it means the best NASCAR driver of his generation has a blank slate of "inventory" for the first time in nearly two decades.
"Jimmie is one of the greatest champions and ambassadors in all of sports and still at the top of his game," team owner Rick Hendrick said. "This change opens up all kinds of possibilities, and we look forward to having conversations with potential new partners. It's a special opportunity with an iconic athlete and team."
For Lowe's, the decision is simply business.
The home improvement company teamed with Hendrick and Johnson in 2001 when the driver was a nobody. Owner and company took a leap on Johnson, the driver Jeff Gordon promised them was going to be a star. Gordon was right and Johnson was so good that Lowe's couldn't leave.
Lowe's signed on in the heady days of NASCAR when sponsors paid $20 million or more just to get in the door with a top team. A deal for an entire 36 race package, plus the two all-star events, could cost upward of $30 million per season.
Lowe's wasn't sure about Johnson when Hendrick sold them on a full deal; the company hedged its bet with a smaller deal for four-time champion Gordon just in case Johnson was a bust. But even if Lowe's got in on the cheap with Johnson in 2001, the price undoubtedly went up as Johnson racked up his record-tying seven championships, 83 victories and a Hall of Fame career all while representing the Lowe's brand the last 18 years.
As one executive once put it, for Lowe's, taking that chance on Johnson, was like "winning the lottery."
Times have changed.
Sponsor after sponsor has scaled back on full package commitments, and teams now sell open inventory on their cars in pieces. A full season sponsor is now almost unheard of in any racing series and one by one the Fortune 500 backers have altered their marketing spends. Target is out of racing. So is Home Depot and Sprint. UPS, Subway, Great Clips and Dollar General. Aaron's and Best Buy are gone, too. GoDaddy was gone but came back only this season for a two-race farewell tour with Danica Patrick.
It's a different world, and only a handful of companies come anywhere close to the commitment Lowe's has had with Johnson, including every race last year. Denny Hamlin had FedEx on 34 of 36 races last year. A Mars Inc. product was aboard Kyle Busch's car for 30 points races and his other six went to Interstate Batteries.
But those deals are dinosaurs left over from the financial upswing, and aside from FedEx and the M&M's line, nearly all the megadeals from the early 2000s have either left motorsports or gone the way of Miller Lite, which gradually reduced its hold on its Brad Keselowski inventory. By scaling back, Miller Lite decreased its spend, retained its association with Keselowski and gave Team Penske empty pages to sell.
Now Hendrick Motorsports will put Johnson's car on the open market and they can sell the inventory in pieces for the first time.
It's a pretty valuable asset, too. Along with crew chief Chad Knaus, the No. 48 Chevrolet team is one of the best in stock car history. Their seven championships equal those of Hall of Famers Richard Petty and Dale Earnhardt, and in 2009 Johnson was the first driver named Associated Press Male Athlete of the Year. Johnson is 42 and signed with Hendrick Motorsports through 2020.
"I'll always be grateful to Lowe's for taking a chance on me and believing that I could win," Johnson said. "I'm not sure where I'd be right now if they hadn't committed to the No. 48 team. It's hard to see them move on, but we've made history together and celebrated so much success on and off the track."
Lowe's probably stayed in the sport longer than expected because rival Home Depot left NASCAR after the 2014 season. Menards is still in NASCAR, and while the Lowe's funding helped Johnson and Hendrick Motorsports find success, there is not much of a rivalry in the marketing space.
Lowe's chief customer officer Michael P. McDermott said only that the company was "evolving" its strategy.
"The No. 48 team is a valuable property and has been an integral part of building the Lowe's brand, which makes today's decision difficult as we now look to invest in other strategic initiatives," he said.
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