Other Side of the Coyne

Two storylines have dominated the conversation in IndyCar this offseason. Who will drive the second car for Dale Coyne Racing and what will PREMA look like in year two if they continue to exist at all. One question has been answered- Romain Grosjean will return to Coyne for the 2026 season but PREMA’s future is murkier than ever.

Let’s zoom out and look at the larger movements within IndyCar and consider how those big picture changes might be influencing the situations at DCR and PREMA.

Penske’s Vision

Roger Penske is the most powerful man in American open wheel racing and has been for decades. I don’t think it’s much of a stretch to say that he built his entire car dealership and equipment rental empire specifically to fund his race team. This year marks Team Penske’s 60th anniversary and in that time he established the standard for professional race teams that every other team emulates today. Needless to say he has very strong opinions on where he wants the sport to go into the future and has telegraphed a few ways he wants to get there.

Penske purchased the IndyCar Series and the Indianapolis Motor Speedway from the Hulman-George family at the end of 2019 and almost immediately started floating the idea of introducing a team charter system to IndyCar. The sales pitch was to build value in race teams above and beyond the cash value of their cars, tools and shop facilities. The thinking behind this is that by creating a closed ecosystem with limited paths to entry for new teams, the long established teams now have an asset that rewards their years of effort, helps justify their continued investment in IndyCar, and gives them a safety net should they ever decide to leave the series.

When the charter agreement took shape ahead of the 2025 season some major changes were made to the team landscape. Four and five car superteams were pared down to a maximum of 3 full time entries, spreading the charter equity more evenly across the paddock, and the total number of charters issued was capped at twenty five.

NASCAR introduced a similar charter system in 2016 and the first charter sales between teams were valued between $1.25M and $3.25M. In 2024 one charter sold for $40M. We have yet to see any IndyCar charters change hands so it’s tough to assign a value to them and even harder to predict where that value could go in the future as the sport grows. At its most basic level a charter qualifies you to compete for the 22 leaders circle spots, if you’re confident you can beat out three other chartered entries in the season points standing you can count on a payout from the series. Currently leaders circle payouts are $1.66M so a good baseline would be a 3x to 5x multiple of that, at least while the possibility of running as an open team exists. If that window ever closes charter values wouldn’t be tied just to leaders circle payouts. (Foreshadowing)

There’s been a growing sentiment among Penske and some top team owners that shrinking the grid by forcing out underperforming (and underspending) teams would result in a higher quality racing product and accelerate the growth of the series. That seems to have been the thinking behind capping the charter allocation at 25. New prospective team owners come sniffing around IndyCar all the time and, long term at least, the charter system will ensure that anyone who wants in has to go through an existing team- either as a partner or leasing / buying their charter outright. With one glaring exception…

Preparazione Machina

While charter negotiations were underway PREMA had already made a sizable investment, rumored at around $50M, to establish a new 2 car IndyCar team for 2025. It didn’t make sense to award charters to a team that had never turned a lap in IndyCar but PREMA, with their decades of experience in the European junior formulas, were exactly the kind of professional outfit that any series would welcome with open arms. PREMA were approved to compete in 2025 and beyond uncharted as the 26th and 27th open entries. The assumption at the time was that the grid would still shrink to 25 by the time the current charter agreement runs out in 2031 with PREMA either leaving the series or buying out existing charters.

PREMA crossed the Atlantic with a shipload of experienced engineers, mechanics and cigarettes ready to show the Americans how it’s done. They were immediately one of the best funded and best dressed teams in the series and ready to conquer. What followed was an unmitigated disaster of lost testing and practice time, setting their driver on fire, and penalties and disqualification from the Indy 500 after their lone bright spot of putting Robert Schwartzman on pole.

Last May PREMA’s parent company cut off any funding beyond the 2025 season and in January three members of the Rosin family who founded the team in 1983 left the company with no explanation. 

For the better part of a year now CEO Piers Phillips has been trying to keep the lights on at PREMA while courting prospective buyers in a bid to secure the future of the operation he built. Almost on cue they became a test case for IndyCar’s charter era. Since PREMA operates as the only open team in the series, any prospective buyer is only buying their physical assets. No added value from a charter, no guaranteed starting spots and no access to leaders circle payouts. Having already missed all of their available preseason testing, Phillips admitted the team won’t be on the grid to start the season. PREMA are expected to miss all three races in March and would start their season at Long Beach at the earliest. Every day those assets continue to lose value, there’s a new car coming in 2028 which means in less than two years all the chassis and all associated parts they own will be virtually worthless. 

The Pay Driver Business Model

There’s an uncomfortable reality in racing. Pay drivers. As long as there have been race car drivers there have been rich guys who have bought their way into the club. Some forms of racing have embraced it, in sports cars some classes mandate amateur drivers in order to keep that money flowing through the sport. Other forms of racing look down on the practice and calling someone a pay driver is considered an insult. It’s important to recognize that drivers of all skill levels sometimes bring a full or partial budget to a team, usually through a personal relationship with a sponsor, but there are always extreme examples- drivers who clearly don’t belong in the top levels of the sport and teams whose business model relies on those drivers cutting them a check.

Nature is Healing

It’s easy to think now, in February of 2026, that PREMA will simply cease to exist and IndyCar will reach their 25 car cap without any bloodshed. But thats not how things looked a year ago. It’s clear that the double-whammy of increased confidence and equity provided by the charters and the existential threat of a shrinking grid have shocked some teams into action, fundamentally changing how they operate. By my count in 2024 there were 6 full time entries occupied by pay drivers, that dropped to 4 in 2025 and has dropped to 2 for 2026. Dale Coyne Racing was the worst offender with 10 different drivers buying their way into his two cars in 2024. This was deemed so egregious that the so-called “Dale Coyne Rule” was written into the charter agreement limiting teams to 3 drivers per car per season.

2024 was not an exception for Dale Coyne it fit the rule. Coyne has been a team owner for 42 years and has always prided himself on doing more with less, operating on a shoestring budget and filling his cars with drivers on the margins of the series; rookies other teams passed over and veterans trying to eke out an extra season at the end of their career. All the better when those drivers brought some cash with them. I say ‘doing more with less’ but ‘doing the bare minimum’ might be more accurate. For perspective, DCR has won 6 races in their 42 years while at the other end of the financial spectrum, Team Penske won 209 races in that same span of time.

You might look at that disparity and think “We need to rein in spending to keep billionaires from dominating the sport!” In the wider world billionaires may have become the enemy but the microcosm of racing has always been and always will be the playground of those who can afford it. IndyCar fans of a certain age also know we’ve been down that road before. Tony George had a grand vision of cheap cars, cost caps, subsidized teams and a direct path to get drivers from dirt tracks to superspeedways. He realized that vision. It was called the Indy Racing League. He split the sport in two for over two decades and IndyCar has yet to fully recover. The IndyCar of today still bears some resemblance to the IRL, spec chassis, spec tires, limited testing, affordable engine leases. Enough has been done to control costs in pursuit of parity. If IndyCar wants to bring the grid closer together the responsibility falls to the backmarker teams to raise their game.

Dale Coyne read the tea leaves and saw that the way he has done business will no longer be viable in the charter era. He also knew that if he wanted to stop relying on checks from drivers he would need those checks to come from somewhere else. For 2026 DCR has formed a technical alliance with Andretti who are farming out their rookie project Dennis Hauger to Coyne. This is common practice in IndyCar but has grown significantly since the implementation of the 3 charter cap per team. Coyne not only benefits from having a talented driver in the car and engineering and data sharing from the much more successful team, you have to assume that the arrangement also comes with a stack of cash from Andretti. That brings us to the second car. In August at the final round in Nashville Dale Coyne Racing announced a new partnership with Todd Ault as the new financial backer but no driver. Halloween, Thanksgiving and Christmas all passed with no driver announcement for the 18 car. The rumors at the Nashville unveil were that Romain Grosjean would be tapped for the empty seat, Todd Ault is apparently a huge fan and Romain clearly hadn’t burned the bridge to Coyne when he left the team after 2021. So why did it take almost six months to make the announcement?

Ideally when race team owners seek out a money man they find a titan of industry who’s built their fortune in a stable industry and wants to be involved in racing for the love of it. Dan Towriss went from sponsoring Zach Veach at Andretti part time in 2018 to owning the entire organization from IndyCar to F1 to NASCAR by 2025. Ted Gelov proved theres real money in fake sugar, leveraging his Splenda fortune to prop up Ed Carpenter Racing and set them up for their most competitive season ever. Todd Ault by contrast owns half a dozen companies in the crypto space. BMAX.IO, which is the primary sponsor on Grosjean’s car, is some kind of trust based financial product centered around Bitcoin that doesn’t even exist at the time of writing. Now, it’s easy for me to thumb my nose at an industry I don’t fully understand but I don’t think you can argue that words like ‘volatility’ and ‘uncertainty’ permeate the crypto space but don’t bode well for race team finances. It seems that the six month wait was most likely a simple case of Dale Coyne waiting for Todd Ault’s check to clear. Thats not to say that the money doesn’t exist or that Todd Ault’s pockets aren’t as deep as he’d like you to believe but finance bros wouldn’t be finance bros if they didn’t try to hold onto their money for as long as possible. Layer on the need to turn your monopoly money into old fashioned US Dollars and the result is a February, 13th driver announcement. Cause for alarm? Probably not but the optics aren’t great for team that seems to care about the optics for the first time in their history. Todd Ault should care about the optics too, he has a long history of facing litigation for financial dealings I won’t detail here except that he recently dodged a $10M lawsuit from Ed Carpenter Racing over non-payment of his sponsorship of the team for 2024. The case was dismissed in October because, though he had seemingly agreed to terms verbally and through emails, he never physically signed a contract. It’s unclear whether Ed will appeal that decision. Remember though that Ault’s partnership with Dale Coyne was announced in August- thats two months before the case was dismissed. It makes you wonder what would have happened to this new partnership if the judge had found in favor of Ed Carpenter Racing or what may still happen if they appeal successfully. Coyne said at Nashville in August that he hoped to announce his second driver by Halloween. Todd Ault’s lawsuit was resolved on October 29^th. Assuming those two things are connected, and I think they are, that means Dale was planning his announcement around a future court date for Ault. That paints a pretty bleak picture of their partnership moving forward.

Dale Coyne isn’t the type to sit on his hands and wait patiently for things to come together, he certainly kept in contact with drivers who have budgets to go racing (he always does) but he may have also complicated the PREMA situation. Anyone in the market to buy an IndyCar team right now might be willing to operate as an open team, at least to start, but if Dale was actively shopping his charter to prospective owners whether through a sale or possibly a lease arrangement that would give him a lot of power in the ownership market. Now that things seem settled and Dale Coyne has pieced together two competitive entries, PREMA is the only game in town for potential owners and drivers.

IndyCar recently announced a major breakthrough: locking in Honda and Chevrolet as engine suppliers for multiple years. Great news for sure but the headline of the announcement was that both Chevy and Honda would be awarded one charter each starting with the 2028 season. In another case of curious timing Dale Coyne Racing made their driver announcement the next day. This could be a complete coincidence, the Sebring open test is a natural time to make these kinds of announcements, but its also possible that Dale’s plans changed once that deal became official. These two additional charters bring the total to 27 and, unless IndyCar reverses their stance on shrinking the grid, eliminates the possibility of running as an open team beyond the 2027 season. It was already unlikely that PREMA would still be racing after the introduction of the new car in 2028 but now its almost impossible. Now that holding a charter is the only way to participate in IndyCar the price of a charter has gone up dramatically. Anyone who was thinking of buying PREMA now and buying charters later has to recheck their math. While PREMA’s situation just went from bad to worse Dale Coyne Racing has completed their pivot from from a car rental operation to a legitimate two car team. It’s clear though that these stories are not over and we’ll be watching them closely in the weeks ahead.

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