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The next big thing

by Bob Margolis, Yahoo! Sports
January 22, 2005

DAYTONA BEACH, Fla. – Few can doubt that when Toyota first began its dialog with NASCAR officials nearly a decade ago, its ultimate goal was to have an entry in the sanctioning body's top series.

And Toyota had a more than satisfactory opening season in the Craftsman Truck Series last year, winning at Michigan, New Hampshire, California and Texas and finishing third in the manufacturer standings.

Although the Japanese manufacturer has not officially announced that it will field entries in the Nextel Cup Series, competitors, fans and drivers all know that it is just a matter of time. People in the NASCAR garage believe it will be very soon. In fact, don't be surprised to see the Toyota badge in Daytona Beach on February 19, 2006 – though it's currently unclear which model car the manufacturer will run.

Of course, no one from Toyota, NASCAR, or for that matter, the three manufacturers already involved in Nextel Cup racing – GM, Ford and Dodge – will speak on the record about it. Sources indicate, however, that there are some concerns that NASCAR will bend the rules to permit Toyota to launch a strong effort from the beginning.

But based on the impact the manufacturer had in the open wheel Indy Racing League, it's clear that Toyota doesn't need any extra help to make its racing programs successful. When Toyota entered the IRL in 2003, it quickly made its presence felt by winning the Indy 500 (and its pole), nine of the 16 races and the manufacturer's championship.

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In other words, Toyota hardly needs a helping hand.

So why is there such uproar among competitors and in the media that Toyota will be given an advantage?

There are several reasons.


Engines: To enter the Craftsman Truck Series, NASCAR allowed Toyota to build one from a clean sheet of paper, much like Dodge did in its return to NASCAR in 2001. Toyota asked for the ability to build a new, race-specific engine because at the time, it did not build a carbureted engine or a V-8 … or even an engine with its camshaft in the block.
Many believe that Toyota has asked for more this time around. Multiple valves per cylinder, fuel injection and overhead camshafts have been discussed.

But those items have been discussed for years – prior to Toyota entering the picture – with the other three manufacturers. Those manufacturers recognize that the existing engine design used in Nextel Cup racing has far outlived its original intent and it is time to look at a new engine.

Representatives from GM, Ford and Dodge would prefer to build and race an engine that better reflects what is being sold in cars today, using technology based in the 21st century, not the 1960s.

Discussions between NASCAR and the Big Three are currently under way and a new engine design is expected to be approved for introduction in the 2007 season. This new engine is expected to run on unleaded fuel, which will also pave the way for NASCAR to race in Canada, where leaded fuel is illegal.


The business model: Toyota does it differently. For example, in the IRL, Toyota's racing arm, TRD, builds every engine and then sends them to its teams, where no significant modifications are made – according to the league's rules. Keep in mind, these are rules which came about after much lobbying of IRL officials by Toyota.
In the Craftsman Truck Series, Toyota goes a step further. The manufacturer not only builds the engines for its teams, it builds the trucks as well, which goes against the current model in NASCAR. Typically, everything except engine parts – which come from the manufacturer – is built by the team.

"Doing it the way Toyota does it, they don't make use of the "Tribal Knowledge," said one Big Three representative. "We believe that is an essential ingredient to success at this level."

"Tribal Knowledge" is a term which describes the accumulated knowledge that crew chiefs, drivers and team owners have gathered from years of running in NASCAR. Having run 70 or more races at Martinsville, for instance, can't be duplicated in the development lab or on a computer.

Even so, Toyota says what it's doing works just fine.


Money: Toyota has plenty of it and loves to spend it on racing – on both racing technology and on marketing the brand to the racing public. In other series, its financial assistance goes beyond technical and mechanical help. There is also direct financial compensation given to teams.

Sales: The reason Toyota entered the NASCAR Craftsman Truck Series was to sell more trucks. The reasons for competing in the Nextel Cup Series would be obvious.
The old racing adage was "win on Sunday, sell on Monday." Toyota still believes that if you show people a product good enough to win in competition, consumers will believe the product they find in the showroom also will deliver – which certainly provides ample motivation for Toyota to win in NASCAR.

Toyota's involvement in NASCAR goes hand-in-hand with its ever-expanding presence in North America.

"We will not stop in our efforts to be a good corporate citizen in North America," Toyota CEO Fujio Cho said at the North American International Auto Show. He made those remarks as the Japanese giant's global sales edge closer to those of General Motors Corp., the No. 1 automaker for more than 70 years.

Toyota aims to sell 8.5 million vehicles globally in 2006, while GM's sales have slipped from a 2001 peak of 8.59 million. Further, Toyota has invested more than $17 billion in North America, where it can build 1.7 million vehicles and employs more then 36,000 people. It is opening a factory next month in Mexico, building a truck plant in Texas and already has more growth plans.

Marketing execs from Toyota say their goal is to have the next generation of car buyers think of Toyota as an American car company.

Further impact
Those who currently work in the Nextel Cup garage – the crew chiefs and the drivers – voice concern that NASCAR may not be willing to say no to Toyota.

Surprisingly, GM, Ford and Dodge motorsports executives aren't nervous. They all agree that should Toyota make the official decision to enter Nextel Cup competition, its presence in NASCAR can and will be a positive development for the series – as long as Toyota isn't given any special deals.

"I'm confident that Brian [France] will continue to guide this series in a way in which we will all benefit," said an executive from one of the Big Three. "The France family has watched what happened in other racing series when the Japanese came in. That's not going to happen here."

(Incidentally, execs from the Big Three all agree that Honda still is several years from making the move, and that Nissan could be the next Japanese manufacturer to join the NASCAR ranks.)

Bill Davis Racing, Penske Racing and Chip Ganassi Racing could be on the list of Cup teams potentially making the jump to Toyota once it reaches the Cup level. BDR already has a relationship with Toyota in the Truck series, while Penske and Ganassi run Toyota cars in the IRL – a fact that doesn't sit too well with officials at Dodge, who see Penske and Ganassi as two of the company's premier teams.

Toyota already is a force to be reckoned within the showrooms of North America and on the race tracks of the world. In North American motorsports, NASCAR Nextel Cup racing is the big show, and Toyota knows it