It's one of IndyCar's longest-running sagas, having been discussed since the 1990s (and probably even earlier), but now IndyCar finally has a new franchise system.

This is an absolutely monumental development.

For example, if you spend hundreds of millions of dollars on a new IndyCar team – buying equipment, building a factory, hiring staff, etc. – and then for some reason are forced or decide to stop competing, your only option is to sell your physical assets.

With a charter system, every entry has value because prospective teams need an entry to participate, giving your business a tangible value in the IndyCar scene.

As with any asset, value can rise and fall depending on market conditions.

BUMPING STAYS

For many years, it has been an uphill battle to achieve this goal, largely because what teams want from a charter system is a guaranteed presence at the Indianapolis 500.

Similar to the 24 Hours of Le Mans and the World Endurance Championship, the main event is bigger than the championship itself, and most of the IndyCar Series' sponsorship money is spent around the Indy 500.

Failure to meet the requirements could cost you millions in lost sponsorship money and also affect your chances of receiving future sponsorship money.

Of course, a team knowing for sure that it is in the Indy 500 is in direct opposition to what the fans, the event and the series want: danger. They want a “bump day” where the cars fight to make the Indy 500 or go home and fail to qualify. That's what happened to Dale Coyne and Nolan Siegel this year.

It is one of the most highly anticipated elements of the Indy 500 and something that few other motorsports events can offer at this level.

Somehow, IndyCar got teams to agree to leave guaranteed Indy 500 spots out of the original charter agreement in order to go ahead with the race. In most cases, this is probably because it was worth implementing the system to give value to a team's entrants.

This is a big win for the Indy 500 and for IndyCar, which makes its fans happy. Losing the bumping would have been another arrow in IndyCar's board, as it has been under fire this year for various criticisms.

PREMA ACCEPTS HIS “REJECTION”

Newcomer Prema Racing in 2025 is an example of the teething issues of this move for the series, as it is exactly the type of high-profile team IndyCar would like to see involved.

But due to the rules necessary for the functioning of the charter (since it was important to reward consistent participation in the past) it could not be included, despite investing millions to participate in the series with two cars next season.

This means qualifying for every race, which shouldn't be a problem unless the other teams field additional cars as the season goes on. At the moment there are 25 charter cars and the two Prema cars, and next season the grid for all regular races will be limited to 27 cars, so Prema should automatically qualify for all events except the Indy 500.

The Race understands that the series can expand its grid from 27 cars after 2025, regardless of whether the charter system is introduced, but many of the circuits will be unlikely to be able to support this.

Prema also cannot compete for the Leaders' Circle prize money, which is worth around US$1 million at the end of the year for the top 22 competitors (or now, rather, the top 22 competitors with charter contracts), which would be US$2 million for Prema if it had managed to get both cars into the top 22.

Of course, Prema could acquire charter contracts for 2025 and beyond, but as the system is only just starting up, it is difficult to determine their value and The Race is aware that the prices currently quoted are considered high.

This is obvious because the top 25 teams plan to compete next year and have no reason to sell, which significantly strengthens their position. In short, it shows the current teams the value of the system first and foremost.

Prema is pragmatic enough to know that it is the new team in the block and it would be annoying for the current teams if it had received preferential treatment.

The new charter model is great news for IndyCar: it gives the loyal teams something they have wanted for years, but without affecting a fan-favorite part of the season that has stood in their way. It also creates more inclusive conditions so the change is not as big a blow as perhaps expected for the most eagerly awaited new team in years.

And with a new road race expected to be announced next month, likely to be held in Dallas according to The Race, there's plenty to be excited about for the series as the offseason begins.

Let's hope it will be used as a springboard to work on further IndyCar improvements.