RACE TIRES AMERICA PROPOSES
“DECLARATION IN FAVOR OF COMPETITION”
In the 1970’s, Joe Jacobs, the developer of the race tire business that eventually became Race Tires America, proposed and encouraged race tracks and promoters to adopt spec tire or track tire rules. Under this concept, track owners and promoters adopted a manufacturer’s tire for a particular class of races for the duration of a racing season. The purpose of the rule was to avoid the almost constant pace of tire changes that were particularly costly to racers, and to encourage racer parity by removing the “hot” tire setups. With all racers competing on a single tire design and compound, the tire wars would be quelled and race results would be more related to a driver’s skill and ability and not a more expensive “state-of-the-art” tire. The acceptance of spec tire rules contributed to the success and popularity of dirt track racing in America.
Initially, competition between tire suppliers was not impeded by spec tire rules. When these rules were first introduced, there were at least five American tire producers supplying the sport. Actually, spec tire rules enhanced competition because tire rule arrangements between tire suppliers and track promoters were typically for the duration of a single season; tires were selected after objective tests were conducted using criteria established by a promoter or group of racers; and normally, because the dirt track racing industry was fragmented and without large rulemaking organizations, agreements covered only one or a small number of tracks.
However, in recent years, the purposes and effect of spec tire rules have changed. Rather than seeking parity with a single tire with specific characteristics, many track rules stipulate a single manufacturer, while allowing an array of tire sizes and compounds from that sole manufacturer. Track rule agreements now extend far beyond a single season, encompassing three to as many as five years, with “evergreen” clauses providing for automatic contract extensions. Seldom are objective criteria made available or tests conducted among competing suppliers to determine the tire with the best fit for the promoters and the racers. Mere lip service is given to the interest of the racers in purchasing an economical tire. And rather than being limited to a single track or a small number of promoters, sanctioning companies now predominate in negotiating and obtaining track rule agreements. The largest of these bodies claims to sanction more than 5,000 events at numerous tracks throughout a single season. Lastly, and most importantly, the selection of a tire manufacturer as a sole supplier apparently depends on the size of the payments made by the tire supplier to the sanctioning company, promoter, or track owner. One recent contract covering a number of years is reputed to have cost the tire manufacturer $1,000,000, in addition to a stipulated payment to the sanctioning company based upon the number of tires sold by the tire supplier.
Currently, there are two, perhaps three, tire manufacturers supplying dirt track racers. As the function of formulating sanctioning rules has become concentrated in fewer, but larger organizations which direct tire use to a single dominant tire manufacturer, the financial impact on the competitors like Race Tires America has grown. Concentration of rulemaking in a few large sanctioning firms has created concentration on the tire supply side resulting in one tire manufacturer monopolizing tire sales to dirt track racers. This concentration of market power in a single company is having and will have a damaging affect on dirt track racing. Without healthy competition among suppliers, racers cannot be assured of paying the lowest prices for tires. Reliance on a single manufacturer with limited production facilities leaves the industry vulnerable in the event of a catastrophic event, such as a flood or fire impeding tire production. It goes without saying that without tires races cannot be run. A sole tire supplier will have unchecked power and influence on the freedom of track owners, promoters and race drivers to determine the nature of competition on the track.
To avoid the problems associated with monopolies and monopolistic market power, Race Tires of America proposes that all race track owners and promoters, all sanctioning companies, tire manufacturers and race drivers accept and embrace the following “Declaration in Favor of Competition” in dirt race tires: 
DECLARATION IN FAVOR OF COMPETITION
WE DECLARE, that for the promotion and betterment of competition, and all that it stands for in the USA, we support the following:
1. Spec tire or track tire rules will be established based upon enforceable, objective requirements for tires to be used at all dirt motor sports events. Such requirements shall be based upon actual tire size dimensions, tread hardness, and other non-manufacturer specific criteria.
2. Rules for all dirt racing events shall, without discrimination, permit any tire manufacturer whose products meet the objective tire requirements to provide tires for such events. Sanctioning companies, promoters and track owners will not establish any rule, policy, or practice mandating or providing for the use of a single manufacturer’s tire.
3. Sanctioning companies, race promoters, and track owners, as applicable, will independently establish non-discriminatory compensation rates for any and all tire suppliers who supply race tires meeting the objective requirements, which will provide compensation to the sanctioning company, promoters and their affiliated tracks for purposes of offsetting the cost of driver point funds and driver amenities. In each event, the compensation rates shall be in proportion to each supplier’s share of actual tire sales to racers and not on a lump sum or flat fee basis.
4. Tire suppliers will make reasonable and appropriate changes to operations and their race tire distribution network to provide adequate inventories and company representation at dirt racing events.
The single tire, single manufacturer formula used so long ago in establishing spec tire rules was instrumental in allowing racers to achieve a level of competitive parity on the track. However, that model has evolved into a scheme allowing a single manufacturer to capture and monopolize the market for dirt race tires. It is time to recognize that the original objectives of spec tire rules can be achieved without creating monopolistic power in a single supplier by allowing any qualified tire supplier to sell its product to racers at dirt racing events, and by letting the racers make the choice based on quality, performance, price and personal preference.
