IRL Ditches American Ethanol, Plans to Start Races with a Green Card Rather than Flag

In a bold move designed to appeal to all-American fans, the Indy Racing League recently announced it will run its Italian chassis-Japanese engine combination on Brazilian ethanol in 2009.

"This is a tremendous day for American race fans," the league said in an announcement. "Now they have the exciting opportunity to pay upwards of 50 American dollars each to watch non-American drivers, cars, engines and fuel compete here in America."

The league's innovative America Last strategy has caused a buzz among the IndyCar's Midwestern-heavy fan base. "Everyone knows America's heartland loves a good Italian car. And they for sure will line up to watch a racing series that promotes a competitor to American ethanol, which puts hundreds of millions of dollars into the Midwestern economy each year."

"WTF?" said one disgruntled Midwesterner. "If they are going to ditch ethanol, at least go back to American-made methanol. I mean, Brazil? Why don't you just have an aerial tanker full of Brazilian piss fly over and dump it on the crowd? Same difference."

The league would not confirm that it was considering using French Michelin tires and mandating track announcers speak in Portuguese. Rumors that a large green card will replace the green flag could not be confirmed. League officials would only say "depends on what kind of money we're talking about."

Comments

[Johnny]

Sorry man, just have to bite on this one:

"American ethanol, which puts hundreds of millions of dollars into the Midwestern economy each year."

I think you forgot to start that phrase with "The American taxpayer, which has funded..."

I know you're from Iowa and the corn thing hits close to home, it's the same thing with coal for me, but cellulosic is the future and we both know it.

[pressdog]

Johnny. Dude. Not sure what the politics of ethanol have to do with the situation. If your customers make money off something, is it a good idea to promote a rival product? Not a ton of Brazilians are available to buy race tickets. But a ton of Midwestern are. Taking Brazilian ethanol money may just alienate the Midwestern fans and be a net loser for the league (the wisdom of government subsidies not withstanding).

[Johnny]

That's a fair point, but per the IRL story, it looks like ApexBrasil is looking to become a worldwide brand and push all sources of ethanol towards commodity status like oil. Which means they'll be using/trading American corn ethanol along with their own native product just like any petrol company would. And likely to be selling here soon.

Also we probably have to reckon that the American ethanol concerns are probably reeling from the free fall of fuel prices and overall tankage of the American economy. That *somebody* stepped up may be the most important thing.

[mus302]

I have to agree. My first thought when I heard about this was that it further reinforces the elite image of the IRL because it looks like they are too good to be associated with American farmers.

[sciguy]

You have to wonder how much is tit-for-tat, too; American ethanol just bailed on Rahal Letterman and Ryan Hunter-Reay. While you certainly need to worry about alienating your fans, you also have to look at who is supporting your series and who just left. I think you guys have it upside down-American farmers are too good to be associated with the IRL. And they just pulled the plug on one of the last good American drivers left with a seat.

[pressdog]

Good call, sciguy. It will be interesting to see if there is any backlash against the league from the fans. The American ethanol promotion people did bail on the league. The league needs to make a judgment as to whether taking the Brazilian money will costs them fans. Apparently they don't think so. It could be that the average fan doesn't care where the fuel comes from. But for a league with very little American going for it, this is just another non-American thing that you are trying to sell to some pretty red-blooded American fans.

[Jesse]

I wonder if the league even gave it much thought. About a third of the cars on track have Brazilian pilots, fans haven't really done/said much about any other foreign partners, and there were races in three other countries last season.

I think this would be a big deal in NASCAR, but the average ICS fan seems to already have a slightly more global view of motorsport.

[sciguy]

Actually, Jesse, I was thinking the same thing. In the beginning, back when they believed they were going to bring IndyCar to the NASCAR masses, this might have mattered to them. But, let's face it-we've got old CART back (and somewhere Meesh screams). I think they've abandoned beer bellies and mullets and now they are going back after tweed coats and pipes. Marketing to the NASCAR fan utterly failed, and now it's back to the base.

[rj]

With all due respect son of Iowa, corn costs too much to be effective for ethanol. I work for a major engine manufacturer and I see this. It can only work with superhigh subsidies, a superhigh oil price (which doesn't exist right now as the price has come down 60% in the last few months), and superhigh tariffs on sugarcane-based ethanol.

If you want us to use corn-based ethanol, it's very simple. Corn should cost far less on the open market. When you convince your farmer neighbors that they need to sell their product for 50% less, get back with me.

[rj]

"Marketing to the NASCAR fan utterly failed, and now it's back to the base."

So in other words, you think they've given up marketing to actual race fans?

[pressdog]

Oil gets far more government money than ethanol (but they get it in the stealth form to tax breaks etc. rather than an a "subsidy"), so where is the outcry against the oil industry's government largess? Bottom line for me is I'd rather pay an Indiana farmer and Indiana ethanol plant workers for fuel than a foreign country. I love arguments that assume doing nothing is an option. I proceed from this foundation -- America MUST wean itself off foreign energy. So how do we do that? Just wait around until it happens? The return on taxpayers' ethanol investment is less dependence on foreign oil (ethanol already replaces millions of gallons of oil we don't have to import) and creating of a profit motive that is driving further development of American-made alternative fuels and will eventually lead to cellulosic ethanol and other cheaper forms. Since doing nothing isn't really an option, I'd love to hear ideas for developing alternative homemade fuels that involve zero taxpayer dollars.

[rj]

"The return on taxpayers' ethanol investment is less dependence on foreign oil (ethanol already replaces millions of gallons of oil we don't have to import) and creating of a profit motive that is driving further development of American-made alternative fuels and will eventually lead to cellulosic ethanol and other cheaper forms."

And you know damn well as I do that once cellulosic and sugar-based (done in the southern U.S. and Hawaii) becomes more profitable than corn-based, your state would be the first pushing for those to be either made illegal or for only corn-based to receive a federal subsidy. The motive is not energy independence, it's money.

Sugar-based ethanol is 30% cheaper to manufacture because the corn must be distilled to sugar before it can be processed. So once the southern U.S. comes online en masse, corn-based will suffer immensely unless the government gives the corn farmers a further subsidy, which they will, not because it's warranted, but so when those politicians run for President they can win the Iowa caucus.

And another question, I work in a factory so I see this while most others never think about it. The refinery that makes the ethanol, what do you think it runs on? Oil products! It takes gasoline to run all the machines. So all that oil that ethanol uses in the refinery process, is it accounted for when you are making it when we talk about "oil savings"? And then there's the hilarious bit where there are now too many refineries making corn ethanol because they are oversubsidized, and it's having the effect of too much resultant product that is driving the price down to the point that the refineries can't make a profit. Well, you should be making far cheaper anyway.

Honestly, the whole "we can save ourselves from foreign oil dependence" thing is a bit rich because there's a simple solution to save ourselves from foreign oil right now: remove the Brazilian tariff. Making the midwestern U.S. corn farmers have to compete with the Brazilians on price would most certainly do that. It'll drive each to improve their processes to become more efficient so they can sell it for less and still make a profit in a competitive business atmosphere, making regular gasoline look less appealing to the consumer, and that way we can all kiss the Middle East goodbye. All this will happen if the tariff goes away. If you want independence from foreign oil, you'd agree.

I understand you want the best, so do I. But you're making an emotional argument to defend the business based entirely on where you live. Farmers where I live in North Carolina did the exact same thing in 1860.

[Jesse]

@ Pressdog: I appreciate the concise question, so I'll try to provide one in the context of what the IRL did and what I think RJ is saying:

The case for the reduction of foreign dependence of energy is based upon the fact that we get energy from enemies. However, what many don't understand is that an enormous amount of our "foreign oil" comes from Canada, which isn't so bad. Brazil has the potential to be a beneficent ally if we cut tariffs on their goods and consume Brazilian products.

I was born in Des Moines, live in Indiana, and I'd love to see the Midwest produce all of America's energy, but the ethanol model is reliant upon oil prices at $100/bbl. Since that is no longer the case, it isn't economically viable.

Anyway, let's get back to talking racing and agree that nothing good for the ICS ever comes from Venezuela.

[pressdog]

I understand the arguments. (There is a difference between understanding and agreeing.) But I also fail to see what a brawl about ethanol subsidies has to do with the central point of whether or not it's a good marketing move for the IRL to be heavily non-American. The IRL apparently feels the money Brazilian ethanol was offering was worth any negatives to the brand that come from cutting loose American ethanol. I disagree and it gets me back to my rant about the IRL not focusing on the fans. It could be the league is in such financial straights it HAS to take the Brazilian money. I think if the N-word bothered to notice the IRL, let alone feel compelled to compete directly with it, all it would have to do is wrap itself in the American flag and it's game over with red-blooded American race fans.

[AZZO45]

"Marketing to the NASCAR fan utterly failed, and now it's back to the base."

So in other words, you think they've given up marketing to actual race fans? -RJ

Sorry RJ... but IMO, NAS... "N-Word" fans like Sprint Crap & NOT other forms of racing. They believe 100% that their boys are "the Best drivers in the World".... despite never attending an ISC/ CART/ CCWS event live. Add ALMS, Grand Am, & any of the support events from IMSA or SCCA to that list as well.

There are plenty of race fans out there that are not NASCAR die hards. I know who their stars are, but if I have a choice on Saturdays or Sundays... NASCAR is not my first choice

[Mike]

Looks like you may have gotten their attention, P'dog. If I'm interpreting the release from TSO correctly, Angstadt is trying to paint the whole pic of why it was necessary and reconcile the idea with you and those who'd concur with your summary.

[pressdog]

I appreciate the credit, but if I know corn growers, and I do, they are raising holy hell over this to the league. Bottom line -- the league has to make a business decision: is taking the Brazilian cash worth the risk of pissing off some fans. The obviously think it is. We will see if they are right. Attendance at the Iowa race will be a good indication.

[Mike]

Yeah, it's doubtful to me that the leagues attempts to appease them by using corn ethanol in Iowa will have much success. Still, the league sorta finds themselves over a barrel (no pun intended) with the EPIC decision to pull support. I guess maybe the alternative would have been for the league to subsidize the deal? There's a lot of that going around...

[rj]

"Sorry RJ... but IMO, NAS... "N-Word" fans like Sprint Crap & NOT other forms of racing. They believe 100% that their boys are "the Best drivers in the World".... despite never attending an ISC/ CART/ CCWS event live. Add ALMS, Grand Am, & any of the support events from IMSA or SCCA to that list as well."

Ok. If I had to come up with a market share though for all the race fans in the United States and those that enjoyed watching NASCAR, NASCAR would easily be have a majority market share of over 50. So is it really a good business to be cutting off the majority of people that would be potentially receptive to your product? All those Indycar fans in the 1970s and 1980s and cheered for Mario, Foyt, Rutherford, Sneva, Mears, and the Unsers that no longer watch races, it's not like they died. They switched the channel over to NASCAR and that's partly the reason for NASCAR's huge growth the past 20 years.

(speaking of which, the racing market share would be a great thing to find out)

And let me get another gripe off my chest: Pressdog, just a request, but can you stop calling NASCAR the N-word? I understand it's just humor and this is your blog and you can do whatever the heck you want, but where I'm from "the N-word" refers to a racial slur that ends in "-igger" that Southern whites aren't allowed to say otherwise we get fired from our jobs, hence we say "the N-word" in public when referring to the term, and everytime I read it here and on "mynameisirl" it's what I sublimenally read it as. If you want to be derogatory there's also the terms ASSCAR, NAPCAR, and NASCRAP.

[My Name Is IRL]

RJ,

A little background here: p-doggy and I started using "the n-word" in conversation late last year when the news was all about drivers going to stock cars. With the notable exception of Marty Roth literally every driver was rumored to be leaving the IRL in 2008. As a result we quickly tired of saying that six-letter acronym in every sentence so we made a pact in blood, by a fire, at an undisclosed location, and after downing an extraordinary amount of Schlitz Malt Liquor to simply call it "the n-word".

As an addendum, I have noticed one other benefit is that by not saying those six letters explicitly I get a lot less ads for that series on my site. I don't know if pressdog gets the same thing, but I bet that's likely the case. We figured you didn't want to buy any more Jeff Gordon merchandise anyways.

[pressdog]

It is as Jeff states. I labor intensively never to say the n-word on my site. If forced, I'll use "stock car," but only grudgingly. N-word is dead to me. (Most people quickly grasp that I'm not referring to THAT n-word.)