Over the past few weeks, the term “Charter” has been brought up numerous times in reference to the sale of Leavine Family Racing and Germain Racing. The Charter system, which was introduced into the sport in on February 9th, 2016, is a way for NASCAR to ensure teams stick with the sport for a period of time, as well as teams to work more hands on with NASCAR to build the best racing they can. This system also gives teams greater financial security with a guaranteed purse for all teams who own a Charter. While the current Charter term was set to end at the end of the 2020 season, an agreement was made in early 2020 to extend the Charter systems until 2024.

So what exactly is the Charter system? Let’s answer some questions you the fan may have about the “Charter” system!

How many teams are allowed to have a Charter?

As of now, the number of teams with a Charter is 36. That number was not just randomly chosen, however, as NASCAR researched each current team to find out if they had any long term plans to stay in the sport. Of those teams, 36 presented a long term commitment to the sport.

What does a Charter do, exactly?

The Charter for each individual team, or car number, guarantees a starting position for every NASCAR Cup Series race. This also guarantees that each team holding a Charter would receive a share of the purse.

Can teams sell their Charters?

Yes! As we have witnessed in recent weeks with the sale of Leavine Family Racing’s Charter to Spire Motorsports, and the future sale of Germain Racing’s Charter to Michael Jordan and Denny Hamlin, Charters can be bought and sold on the open market. Charters can also be leased to teams on a one year term.

Is there a cap of how many Charters an owner can have?

Yes! That cap is four, and there is no longer an option to run a fifth team for a rookie driver, as was the case previously before the Charter system.

If there are only 36 Charters, why do more than 36 cars sometimes start a race?

The remaining teams contesting a given race are deemed non-Charter, or open teams. NASCAR Cup Series fields are capped at 40 cars, which means there are four extra spots available for teams who do not have a Charter to enter NASCAR Cup Series races.

What happens if a Chartered team races poorly? Can NASCAR remove the Charter?

Yes! If a team does indeed perform poorly, NASCAR can remove the Charter. If a team finishes in the bottom 36 of the owners standings for three consecutive years, NASCAR has the right to remove the Charter from that team.

Featured Image Credit: Jason D Witten

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