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Uncensored CART Commentary
by Ed Donath

Cooked Book Recipes
8/19/02

ATHENS, NY—Seeing the besmirched WorldCom logo emblazoned on so many FedEx Championship Series-related properties (an associate sponsorship of Tony Kanaan’s Mo Nunn Racing Champ Car, the Fast Lap WorldCom Pace Car Unit, a variety of support series car sponsorships and on the back of every CART employee’s white race weekend uniform shirt) one must wonder, at this point, whether the imminent demise of that huge corporation with the over-cooked books will ultimately represent yet another nail in CART’s own corporate coffin.

Coming off a full year of painful and frustrating anti-Heitzler campaigning that produced “a lot of pissed-off people” according to a web publishing denizen of the CART media centers, a well-known editor and an event promoter, it really isn’t at all surprising to me that investment-oriented writers and corporate insiders are loath to blow their whistles at the Enron, ImClone and WorldCom CEO’s and CFO’s of the world.

That there is a web-based facility left from which to continue launching my own occasionally controversial opinions is due, in large part, to the long-overdue epiphany that has finally impacted the entire CART community with the realization that it wasn’t the quality of the product that put the Champ Car Company on the skids but, rather, the quality of its management — or lack thereof.

With the weight of being the Designated Savior now resting squarely on his not-so-broad shoulders, Chris Pook needs strong managers around him to help balance that extremely heavy load. Presently, however, it appears that Pook’s cabinet members are content to defer almost all of their discretionary powers to the head honcho himself. Most, if not all of them, are merely mouthing quotes from the chairman’s little red book as they enthusiastically nod their approval and admiration.

While CART certainly needs a strongman leader more than ever before, the Champ Car Company also needs the creativity and spontaneity that can be so easily lost when one man’s ideas are allowed to prevail over those of the committee. Under such circumstances, VP’s and department heads become merely yes men and women. A perfect case in point: f-inheritor.

Are the combined CART Boards as in favor of letting Grandpa Chris “do it his way” as the management team appears to be? It was surreal, a year ago, when the members of the complicated two-board system — structured to be the original franchise holders’ impenetrable fortress of checks and balances — were so ready to let Uncle Joe write so many unbalanced checks. Could such unlikely history now be repeating itself?

Heitzler’s ability to lull everyone but Vannini, Bond and this renegade scribe into a false sense of security was especially mind-boggling after watching his predecessors — for decades — being forced to suffer the torture of begging those same all-powerful boards for their approval every time they wanted to do anything more important than visit the Executive Washroom.

NYSE:MPH shares, trading today at 20% of original value, didn’t plummet to their subterranean level as a result of the events of 9/11, the struggling American economy or even the lack of an Indy 500. Plain and simple, the books were cooked. At this point, however, knowing whether CART’s near-collapse was the result of a conspiracy or merely of ineptitude and/or malfeasance does little or nothing to aid in the company’s recovery.

The general investment intelligentsia does not know the difference between an air box and a pop-off valve, so they have downgraded the value of Championship Auto Racing Teams stock according to what they do know about the racing business. Which is, that, like all other businesses, it is essential for it to embody the principles of sound management and creative marketing.

Sadly, neither of the aforementioned ingredients, to date, have ever been components of the Championship Auto Racing Teams recipe.

Copyright © 2002 by Ed Donath and Deep Throttle. All Rights Reserved.

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