The Army National Guard announced Wednesday night via a press release posted on their website, that they will make considerable changes to their motorsports sponsorship programs. These changes will include “an end to its sponsorship of NASCAR driver Dale Earnhardt Jr. and Graham Rahal in the Indy Racing League (IRL).”
The release further stated that the sponsorship contracts are due to expire “at the end of the current season.” A statement issued by Hendrick Motorsports Wednesday indicates a different contract expiration date.
“Our team has a contract in place to continue the National Guard program at its current level in 2015. We have not been approached by the Guard about potential changes and plan to honor our current agreement.”
Bobby Rahal, co-owner of Rahal Letterman Lanigan Racing with David Letterman and Mike Manigan released the following statement.
“We were informed this afternoon that the National Guard will end all sponsorship of motorsports, including both IndyCar and NASCAR at the conclusion of the 2014 seasons. This is obviously very disappointing news to Rahal Letterman Lanigan Racing given the significant incremental brand exposure we have worked to produce for the National Guard in our first season together, including various off-track marketing and advertising programs focused on supporting the mission set forth.
“We will continue to work hard to uphold the honor and integrity of the National Guard throughout the remainder of the season. Rahal Letterman Lanigan Racing would like to thank the National Guard for allowing us the privilege of representing some of the finest men and women, those ‘citizen soldiers’ that protect our freedoms and safety each and every day… as we Focus Forward!”
Major General Judd H. Lyons, acting Director of the Army National Guard cited budgetary reductions as the reason behind this decision, explaining, “Significantly constrained resources and the likelihood of further reductions in the future call for more innovative and cost-effective ways of doing business.”
The Army National Guard currently spends $32 million on its NASCAR sponsorship and $12 million on its IndyCar sponsorship. Their fiscal budget for 2015 is expected to be approximately half of what it was in 2012. As a result of reduced resources, they are now looking for more efficient methods to aid in recruitment.
The Guard has come under intense political scrutiny in recent years over its motorsports sponsorship programs. In May, the Senate’s Homeland Security and Governmental Affairs subcommittee on financial and contract oversight again questioned the effectiveness of these programs.
Senator Claire McCaskill (D-Mo) was one of the most vocal, saying, “The facts speak for themselves. The data is very clear. You are not getting recruits off NASCAR. This is data that you gave us.”
However, Lt. Colonel Christian Johnson, head of Army Guard marketing, believes the sponsorship has netted positive results.
“As part of a broad recruitment marketing strategy, motorsports partnerships, including NASCAR, played an important role in helping the National Guard build strong brand awareness and in turn helped us achieve extraordinary recruiting and end-strength objectives over the past decade.”
“Our NASCAR sponsorship was principally a marketing program, intended primarily to build awareness of the National Guard as a career option,” added Johnson. “The NASCAR sponsorship allowed the National Guard to leverage a 77 million fan base and the sport’s most popular driver.”
