What Is a NASCAR Driver's Salary?
As one of the most popular sports in America, NASCAR brings in billions of dollars per year. While drivers' salaries have not generally been disclosed, it is easy to see that they earn more than the average person, which makes sense when you consider that they face the risk of death or serious injury every week just to do their jobs. However, when considering NASCAR driver salaries, there are a number of different factors to take into account beyond what drivers receive in their actual paychecks.
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Base Salary
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Each NASCAR driver who signs with a team will receive a base salary. Often, this salary is dictated by how popular the driver is with fans, how many races he is expected to finish and finish well in, and how much money the team overall usually generates. However, drivers' base salaries are typically lower than other professional athletes', and their true earnings are based on other contractual agreements.
Additionally, historically NASCAR drivers' salaries are kept secret, but contract disputes and other factors have caused many driver base salaries to be made public knowledge. In general, a mid-level driver will earn between $1.5 million to $3 million per year as a base salary. More talented drivers can earn more, as evidenced by Carl Edwards' 2009 base salary of $7.5 million.
Wins & Awards
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In addition to a drivers' base salary, he will also receive a percentage of the purse for any race he wins, and often a certain amount of money based upon where he finishes. This amount varies from race to race, but drivers who win at the Daytona 500 or the All-Star race can potentially win $1 million for that race.
Many NASCAR drivers also participate in various awards programs. While each award program has its own rules, the programs will pay drivers based on where they finish the race or for a special achievement and if they meet the eligibility requirements for using a certain product or displaying a certain logo. Note that this is different from sponsorship programs.
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Sponsorships
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NASCAR sponsors are those companies that pay for their logo to be displayed on the actual stock cars. The size and location of the logo decal will dictate the price that a company pays, and many drivers' contracts stipulate that they receive a percentage of revenue paid to the team by sponsors. Some larger sponsors will also pay drivers to appear in commercials or at special events promoting their products/services, which may be included in the company's sponsorship contract with the team or be a separate agreement between the driver and the sponsoring company.
Endorsements & Merchandising
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Merchandise bearing a driver's name, likeness or number is often licensed by the racing team and the driver. Thus, he receives a percentage of all profits from the sale of this merchandise. Endorsements and licensing agreements are a significant source of income for most NASCAR drivers. For example, Dale Earnhardt, Jr. earned an estimated $30 million in 2010, of which over $10 million was in endorsements alone (Reference 6).
Additionally, drivers may sometimes be allowed to enter into endorsement agreements with companies that are not team sponsors or affiliated with NASCAR sponsorship. This largely depends on their existing team and sponsor contracts, but it can be another way for drivers to earn money.
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