As first seen on Bankrate.com
Ray Evernham may be a NASCAR owner, but he’s still in the driver’s seat when it comes to money.
Evernham, 44, resides in Cornelius, N.C., with his wife and his son, Ray Jr. A former driver himself, he built and drove Modified Division cars from 1979 through 1983 and again in 1991. However, Evernham really came onto the national racing radar when he became Jeff Gordon’s crew chief, part of the team that took NASCAR Winston Cup championships in 1995, 1997 and 1998. He also led the crew that won two Daytona 500s (1997, 1999).
In 2001, Evernham found a new challenge, leading the Dodge Motorsports Winston Cup development program and becoming the team owner of the No. 9 and No. 19 Dodge Dealers Intrepid R/Ts. When Evernham departed, Gordon was supposed to follow his friend over to Dodge, but he had a change of heart and Evernham started his journey without Gordon. The sigh of relief from Dodge’s parent company, cash-strapped Daimler Chrysler, was practically audible when Evernham Motorsports won the 2001 Pennzoil 400. Bill Elliott, Jeremy Mayfield and Casey Atwood are his drivers.
He also started Evernham Motorsports, Evernham Performance Parts and Evernham Marketing Services. Having done broadcast work for ABC and ESPN, Evernham has been a frequent speaker at major corporations including NASA, STIHL, General Electric and Valvoline. Additionally, industry trade groups, such as Fast Company Magazine and the Performance Racing Industry, sought out Evernham to provide keynote speeches.
Evernham spoke to Bankrate about money in the fast lane.
Bankrate: How did you get the courage to leave a very successful operation?
Ray Evernham: It’s hard to pinpoint that exactly. You have to want to accomplish more. I felt like I had confidence in my abilities. It took a while to decide to leave: months, some of them agonizing. But there comes a time in life to change, and no real big changes come without a little pain.
Bankrate: How does sponsorship change at the different levels? When you start out, are you paying for everything and then the sponsors take over?
Ray Evernham: You’ve got to have a business plan, it’s like any other business. You do have to invest your own money. There are several sources of revenue, like merchandising. NASCAR merchandising is a $1 billion a year business now! Even though a very small percentage of that goes to the teams, it still helps with race costs.
Bankrate: What’s the shelf life of your cars? Are you able to repair them when there’s a problem, or is it easier to replace the whole thing?
Ray Evernham: It depends. NASCAR has rules that allow us to repair the cars. They are metal, not plastic, so that’s a good thing. We’re able to weld and repair a lot. Some cars last three years.
Bankrate: Are you able to insure your cars, or do you have to bear the brunt of it yourself?
Ray Evernham: Because of the high risk, I have to bear the brunt of it myself. I just lost $80,000 on a car last week. I do carry a large umbrella liability policy, though.
Bankrate: After the injuries that ended your driving, did you find the transition into managing easy, or did you want to explore other career options?
Ray Evernham: Never! NASCAR has been my love forever! I like people and I enjoy working with a team. I’m more a coach than a manager.
Bankrate: To what do you attribute the rise in popularity of NASCAR?
Ray Evernham: It’s America’s love affair with the auto. There are 43 competitors each week, people can root for their own favorite. The whole family can enjoy it; 40 percent of our fans are women. Plus, it’s one of America’s cleanest sports: Our people don’t have drug issues and they don’t murder or rape.
Bankrate: Is that ironic, considering that NASCAR’s roots are in moonshiners racing from revenuers?
Ray Evernham: Well, they probably do still have a drink now and then! But, that’s better than the alternative. I think that the moonshining thing is a coincidence — that a lot of people in that area developed auto mechanic abilities and that they would have evolved into NASCAR anyway.
Bankrate: You have in-house parts and marketing companies. How did you decide to do that?
Ray Evernham: It’s really important to do that. If you want a championship team, you have to control it. It’s important for Dodge, too. If you do well, you want to keep it for yourself! You also want to keep your own secrets.
Bankrate: Are there improvements you would like to see in NASCAR, such as taking the (speed limit) plates off the engines or marketing?
Ray Evernham: They do a pretty good job. There are some small procedural changes that I’d like to see that I think they will do, such as getting the crews off the tracks faster. They are working hardest on safety and keeping the cars aerodynamically matched.
Bankrate: How do you deal with the conflicts of interest between your two cars or the other Dodge cars? Do you share innovations with the other Dodge owners?
Ray Evernham: My two cars share everything. I do wear a couple of different hats with the Evernham Motors. There are projects for Dodge that we will share. But it’s understood that we don’t share all our secrets. They have secrets, too!
Bankrate: How did you get the skills to manage money?
Ray Evernham: A lot is common sense. Save where you can, spend where you need to. We put our money into performance, not chrome wheels. I have a CFO, Rick Russel, who I’ve learned a lot from. I’ve never been really extravagant in my lifestyle.
Bankrate: Do you have any other investments other than the race cars?
Ray Evernham: Like everyone else, I was in the stock market, but I’m not doing too well. My portfolio is not doing real well. I always say, “Stick with what you know.” I have several companies. I hope to sell parts to regular street cars. I have real estate in North Carolina. I have an agency that handles my personal appearances.
Bankrate: You do a lot of corporate morale speeches. Has the market for speeches gone up or down with the economy?
Ray Evernham: I turn down a bunch of speeches. A NASCAR team is an excellent example of a company. A driver’s group requires teamwork, sports, engineering. We can relate to almost any company.
Bankrate: NASCAR costs run into the millions. How did you save up to leave Jeff Gordon’s team? Did Dodge make it worth your while?
Ray Evernham: I saved. That’s my nature.
Bankrate: Is there a difference in personality between NASCAR owners and other sports teams owners?
Ray Evernham: We’ve all got our personalities. The difference may be that in NASCAR, there are no mega gazillonaires.
Bankrate: You have a son. Would you want him involved in NASCAR? If so, as a driver or an owner?
Ray Evernham: Whatever he’d like to do. If he wanted to drive, he could drive. But I don’t think he will, he’s been diagnosed with leukemia. Whatever he wants to do, music, NASCAR, other sports. Absolutely. My mom and dad had to go through it with me. I couldn’t face Casey Atwood’s mom and dad if I didn’t feel it was safe for my own son.