Incorporated: 1984 as All-Star Racing
Sales: $44.3 million (2007 est.)
NAIC: 711211 Sports Teams and Clubs
Based in Charlotte, North Carolina, Hendrick Motor-sports, Inc. (HMS), is one of the top motor racing enterprises in the United States, focusing on NASCAR (National Association for Stock Car Auto Racing) series. HMS runs four race teams in NASCAR’s premier division, the Nextel Cup competition, as well as a pair of teams in the lower tier Busch Series. HMS drivers, including Jeff Gordon and Jimmie Johnson, have won six Nextel Cups and Winston Cups (the series sponsor before Nextel) in the company’s first 22 years. Sponsor partners include CARQUEST, Chevrolet, Delphi, DuPont, GMAC Insurance, Georgia Pacific, Gillette, Goodyear, Pepsi, Quaker State, and Time Warner Cable. The company’s base of operations is a 90-acre complex in Charlotte where all of the organization’s race cars are constructed. Garages are modeled after Formula 1 shops in Europe that allow fans to watch mechanics work on the race cars. The complex also includes the Hendrick Museum and Speed Shop to further cater to visitors. In addition, HMS takes care of its own licensing, merchandising, and marketing in-house. HMS is owned by its chairman and chief executive officer, J. Richard (Rick) Hendrick III, who is also one of the United States’ largest auto dealers.
Rick Hendrick was born on a tobacco farm in Warrenton, North Carolina, in 1949. Because his father raced modified cars on the weekends, it was not surprising that Hendrick developed an interest in auto racing.When he was just 15 years old he rebuilt a 1931 Chevrolet with help from his father, and then set speed records at his local drag strip. He also proved his mechanical abilities by winning the regional portion of an engine building competition, the Chrysler-Plymouth Troubleshooting Content. Although Hendrick soon gave up dreams of becoming a race car driver, when his mother objected because of the dangers, to attend North Carolina State University, he did not relinquish his interest in cars. To earn spending money, on weekends he worked on cars at a local service station, where he soon met a wholesaler named Sear Sauls and began performing tune-ups for him. Hendrick quickly realized that he could make a lot more money by fixing cars to sell, and began doing a tidy business, helped by his mother who worked at a bank and could provide him with 90-day notes to finance the operation.
Sauls took Hendrick to an auto auction one day, and the young man began diagnosing car problems for some of the dealers. One of them was Mike Leith, a car dealer from the Raleigh, North Carolina, area who was so impressed with Hendrick that he offered him a job when he finished school. Thus, in 1971 Hendrick became the general sales manager of Leith’s import division and a year later became the general manager of Leith’s entire operation. When he was just 26, General Motors asked Hendrick to take over a struggling rural South Carolina dealership that was so small that it did not even have a showroom. Hendrick raised all the money he possibly could to acquire the dealership, and not only did he make a success of it, but General Motors also rewarded his efforts by giving him a chance to take over one of the largest dealerships in all of North Carolina, City Chevrolet in Charlotte, when its owner decided to retire. The dealership, which had never placed much emphasis on used cars or financing until Hendrick’s arrival, quickly became a cash cow and served as a foundation for a mega-dealership, which included Chevrolet, Nissan, Honda, Toyota, and eventually Saturn dealerships.
With financial success, Hendrick was able to indulge his interest in racing. In the late 1970s he became involved in drag boat racing, and in the early 1980s his boats won three consecutive national titles. However, his passion for the sport came to an abrupt end in 1982 when one of his drivers, a friend, was killed in a racing accident. Hendrick looked for a place to store his boats in Charlotte. The man who would provide that storage space, however, was Harry Hyde, a longtime NASCAR crew chief who had left NASCAR a few years earlier after a dispute with his new owner. Hyde encouraged Hendrick to become involved in NASCAR and promised that if Hendrick built a car he would make sure it was a winner.
Hendrick eased into stock car racing by participating in the NASCAR Late Model Sportsman Series (today’s Busch Series) in 1983. Late in the year he teamed up with C. K. Spurlock, and in 1984 they formed All-Star Racing. The former public relations head of a race track, Spurlock turned his attention to promoting musical acts and became Kenny Rogers’ manager. He was going to bring in Rogers as a partner to All-Star Racing, and the great Richard Petty was supposed to be the driver. When those plans fell apart, All-Star Racing turned to a New York–born driver named Geoff Bodine, who had just completed his rookie year in NASCAR. He joined a shoestring operation with no sponsorship, little financing, and a crew chief that everyone considered to be over the hill.
All-Star Racing set up shop in a 5,000-square-foot boat shed leased from Hyde and five employees to work on the car. When the team showed up at the first race of the year in 1984, and the most important, The Daytona 500, the Bodine #5 car had no sponsored decals on it other than the business logo for City Chevrolet and an associate sponsorship from Northwestern Security Life. The team finished a respectable eighth at Daytona and posted other top ten results over the next few weeks. Yet Hendrick, who was far from a wealthy man at this stage, was not certain how much longer he would be able to bankroll the operation. Then, in only Hendrick’s eighth race as a car owner, Bodine drove to victory lane at the race held at Martinsville, Virginia, and with it came a much needed $100,000 from NASCAR’s Winner’s Circle program. Bodine won two more races that year, capping off a stellar season with a win at Riverdale, California, on the final weekend. A major sponsorship deal with Levi Garrett tobacco soon followed and Hendrick’s financial worries ended and he was able to devote his attention to building a solid organization.
Hendrick and Spurlock severed their ties, and in 1985 Hendrick Motorsports, Inc., was formed to run Bodine’s Levi Garrett Chevrolet. Although the car ran strong it never captured a victory in 1985. Nevertheless, HMS announced that in 1986 it would field two cars, something that the NASCAR establishment said was foolhardy. The second driver, sponsored by Folger’s coffee, would be Tim Richmond, who had participated in Winston Cup racing for several years. He would enjoy a stellar year with HMS, winning the most races of anyone, seven, although finishing third in the points competition for the Winston cup.
All Hendrick race cars are constructed start-tofinish at the 90-acre complex, and more than 700 engines are built or re-built on-site each year, with the team leasing some of those to other NASCAR outfits.
Still defying conventional wisdom, HMS added a third team in 1987, hiring one of NASCAR’s top drivers, Darrell Waltrip. It proved to be a difficult season, however. Waltrip struggled all year, and Richmond’s health began to fail, attributed to double pneumonia, and he was unable to compete at times. Veteran driver Benny Parsons was called on to take over Richmond’s car several times, and even Hendrick raced it at Riverside at the end of the year. Richmond was soon diagnosed with AIDS, news withheld from the public but not from NASCAR. He attempted a comeback in 1988 but was banned by NASCAR for failing a drug test that only he among the drivers was subjected to. Although he passed a second test, Richmond was forced out by NASCAR, which would allow him to drive again only if he made all of his medical records public. Because of the stigma attached to AIDS at the time, he chose to retire, although word soon leaked out about his condition. Despite Richmond’s shabby treatment by NASCAR in the opinion of many, his comeback would have been short-lived, regardless. He wasted away and died in seclusion in August 1989.
Driver Ken Schrader took over Richmond’s car in 1988, with Hyde serving as his crew chief. At the end of the year Hyde, not happy with sharing the resources of a three-car team, left HMS. His relationship with Hendrick would soon be fictionalized when Hollywood decided to bring NASCAR to the screen with actor Tom Cruise playing a maverick driver learning how to win from a gruff crew chief, à la Hyde, played by Robert Duvall, and Hendrick was brought in to advise on the script. The result was Days of Thunder, released in 1990.
As HMS entered the 1990s it had three full-time race teams and a fourth car driven by Greg Sacks on a limited schedule. By 1992 Waltrip left HMS, leaving Hendrick with two drivers but three cars. It was then that a young driver named Jeff Gordon caught his attention, as he did many NASCAR teams. Gordon had been a racing phenomenon since his childhood in California. In order to allow him to start racing sprint cars at the age of 13, his family moved to Indiana, where laws were more lenient than in California. He soon moved on to midget racers and at the age of 18 relocated to North Carolina to become a Busch series driver in 1992, when he was named rookie of the year. Gordon was courted by a number of Winston Cup teams, but some balked at his demand that his Busch crew chief, Ray Evernham, had to accompany him to Winston Cup racing. Although the 38-year-old Evernham had never been a Winston Cup crew chief, Hendrick was willing to take the chance and signed Gordon.
Sponsored by DuPont Automotive Finish, Gordon ran the final race of the 1992 season. Then, bringing a fresh perspective to Winston Cup racing, Evernham created a race program. He designed the largest NASCAR race shop at 10,000 square feet at the HMS complex. He also assembled the sport’s first professional pit crew, the Rainbow Warriors, an allusion to the car’s DuPont paint job. They would work out together and practice pit stops with a purpose never before seen in NASCAR, and when fractions of a second saved in the pits translated into hundreds of yards of track position, the competitive advantage proved significant. Overseeing the crew was a Stanford graduate in organizational management. The first year proved an inconsistent one for Gordon’s team, and it finished 14th in points. The team hit their stride in 1995, though, winning three of the first six races on Gordon’s way to becoming the youngest Winston Cup champion. Another edge that benefited all of the teams was Hendrick’s willingness to invest in the latest technology. In the early 1990s, for example, he agreed to spend $750,000 on a German-built, pioneering computer numerical control machine that was designed for hip replacements but HMS engineers converted to produce precise handcrafted parts needed to build an engine. Not only were the man hours needed to build the parts cut almost in half, the parts were more uniform and provided a boost in horsepower.
While Evernham delivered three Winston Cup championships with Gordon in the mid-1990s, he was not devoted to the team concept at HMS, and was reluctant to share information with the other HMS teams. That attitude changed after Evernham’s departure in 1999 and Robbie Loomis became Gordon’s new crew chief. Subsequent crew chiefs would be hired in large part on their ability and willingness to communicate with the entire group.
- Rick Hendrick forms All-Star Racing for NASCAR racing.
- Team is reorganized as Hendrick Motorsports,Inc.
- Jeff Gordon signs as driver.
- Gordon wins first championship.
- Several team executives are killed in airplane crash.
- Dale Earnhardt, Jr., signs to drive for Hendrick.
While Gordon was enjoying tremendous success and the other HMS drivers were also performing well, Hendrick was forced to step away from the operation for personal reasons. First, his dealership business became caught up in a kickback scandal related to American Honda executives giving preferential treatment to dealers in exchange for providing them with cars that had become extremely scarce, and therefore highly profitable, due to voluntary import restrictions. In December 1996 Hendrick was indicted on 15 counts of conspiracy, fraud, and money laundering, along with his brother and business associate, John Hendrick. The crux of the case was the allegation that Hendrick helped to finance a house for a Honda sales executive and then made regular deliveries of cash to help him pay off the house note. Just before the indictment, Hendrick was informed that he had chronic myelogenous leukemia, a type of bone cancer. In order to focus on his health, Hendrick reached a plea deal with prosecutors in August 1997 and several months later at sentencing he apologized for his conduct. He was fined $250,000, sentenced to three years of probation, and confined to his Charlotte home for 12 months. He was also not permitted to be involved with HMS or his auto dealerships.
Hendrick regained his health, and as the new century dawned, HMS continued to thrive. In 2000 HMS unveiled plans to construct a new 85,000-square-foot building to house the operations of both Gordon as well as driver Jimmie Johnson, a promising new driver who was set to join HMS for the 2002 season. He had a stellar rookie campaign, winning three races and finishing fifth in the final Nextel Cup standings. He would finish second the next two seasons before winning the championship in 2006.
While HMS was enjoying tremendous success in the early 2000s and establishing the standard for multi-car operations, the operation also overcame tragedy. In October 2004 one of the HMS planes, beset with foggy weather on its way to a race at Martinsville, Virginia, crashed, taking ten lives, including Hendrick’s brother John, Hendrick’s son Ricky, team general manager Jeff Turner, engine director Randy Dorton, as well as John Hendrick’s twin daughters, a DuPont representative, the pilot for driver Tony Stewart, the pilot, and copilot. It was a devastating loss both personally and for the HMS organization, yet everyone persevered. On the day of the crash, Johnson won the Martinsville race, and won again the following week at Atlanta.
In 2006 Johnson garnered his first championship for HMS. The following season, HMS and its four drivers dominated Nextel Cup races for the first four months, winning ten of 14 races, with Gordon and Johnson each winning four times. Hendrick’s stable of drivers grew even stronger when Dale Earnhardt, Jr., son of the legendary Dale Earnhardt and NASCAR’s most popular driver, agreed to join HMS for the 2008 season.
Joe Gibbs Racing; Roush Fenway Racing; Wood Brothers Racing Inc.
Anderson, Lars, “Of Tragedy and Teamwork,” Sports Illustrated, October 24, 2005, p. 52.
Bernstein, Viv, “10 Are Killed in Crash of Hendrick Team Plane,” New York Times, October 25, 2004, p. D4.
McCraw, Jim, “The Making of a Winston Cup Champion,” Popular Mechanics, April 1996, p. 72.
Meier, Barry, “Rick Hendrick’s Days of Thunder,” New York Times, July 10, 1994, p. A1.
“Rick Hendrick: Hendrick Automotive Group,” Dealer Magazine, December 2005.
Robinson, Edward A., “Fall of a Megadealer,” Fortune, April 28, 1997, p. 34.
Sheldon, Kathy, “Rick Hendrick: Owner, Hendrick Motor-sports,” Sporting News, June 7, 2004, p. 40.
Spencer, Lee, “It’s Truly One for All at HMS,” Sporting News, January 26, 2004, p. 56.