Haas-Carter concerned over Kmart's woes
By Marty Smith, Turner Sports Interactive
January 23, 2002
10:33 AM EST (1533 GMT)
CONCORD, N.C. -- Tuesday's announcement that the Kmart Corp. has filed for Chapter 11 bankruptcy brought into question whether or not the move will affect Haas-Carter Motorsports, the NASCAR Winston Cup Series operation that fields two Kmart-sponsored Fords driven by Todd Bodine and Joe Nemechek.
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Joe Nemechek signed on in November to drive the No. 26 Kmart Ford for Haas-Carter.
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Team owner Travis Carter told NASCAR.com on Tuesday that he's "cautiously optimistic" about the future of his two-car operation. Carter did confirm that Kmart was on schedule with their sponsorship dues at present, and that the company has informed him to continue on with business as usual.
"The discussions are going on right now, but there are no assurances of anything right now," said a dejected Carter from his Statesville, N.C. shop early Tuesday afternoon. "They've indicated to us that we should proceed as normal."
Carter has partnered with Kmart for four years, with gradually increasing success. Last season, drivers Jimmy Spencer and Todd Bodine placed the Kmart machines on the front row twice during qualifying.
"We've made some progress and done some real good things for them," Carter said. "I think last year we did real well for them. The thing that's encouraging to me is that they've come outta the box with a stronger campaign than ever."
According to the Atlanta Journal Constitution, the Troy, Mich.-based company hopes to reorganize rapidly and emerge from Chapter 11 by 2003. Either way, Carter reiterated that he was told Tuesday morning to conduct business as he always has.
"We hope that they can get back in line. We're anticipating that, and I think they are, too," Carter said. "Per our conversation with them, they told us to proceed as normal. So we'll do that until we're told something differently.
"I think from the public view, the public probably knows as much about this as I know. We're going about our business every day and dealing with people and putting programs in place and preparing racecars to race. Then you hear in the news what's going on within (Kmart).
"It's almost like two different segments, you know? The people we're dealing with have progressed as normal, paid their initial payments to us and all. That gives us reason to progress as normal."
Carter didn't specify just how much money Kmart contributes to his team yearly, but considering that an average Winston Cup sponsorship is in the $10 million range, and that both of his cars are backed by Kmart, it's likely somewhere near $20 million.
"They're like any sponsor, they pay a goodly sum of money to do this," Carter said. "And teams can't operate without it. Maybe some things will be resolved today, maybe not. I don't know. I'm not familiar with these proceedings, haven't talked to any lawyers, so I don't know the standard procedure for bankruptcy proceedings like this. We'll just see what happens.
"We can't assume anything right now. The information I've gotten so far has been very sketchy. I've been on some phone conversations today, but some of the key people are tied up in some of these meetings. I don't have some of the answers we need."
He admits it might be time to look elsewhere.
"You always have your eye open and ear to the ground," Carter said. "Unless you got a sponsor for about 10 years or something. Then, you don't worry about it for the first five, but after that you best start looking. That's the way it is in this business. The one thing about it is that you're vulnerable in this business. That's a weakness. Not that many companies can afford to do this, or even will do it."
Carter doesn't even want to imagine what might happen if Kmart does, in fact, have to drop its backing for some reason.
"I'm not thinking that way," Carter said. "I'm trying to think more positively than that. If the thing went down, I know what would happen. So we're trying not to think that way."
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