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August 14, 2011

Randy Bernard

Tony Cotman

Will Phillips

THE MODERATOR: We are pleased to be joined by Randy Bernard, CEO of IndyCar, seated here in the middle. To my left, Will Phillips, vice president of technology for IndyCar, and to the right, Tony Cotman, project manager for our 2012 IndyCar. We're here today to make a special announcement regarding the 2012 IndyCar as well as to discuss for Randy the recently announced deal to extend our relationship with ABC as our network broadcaster. We'll turn things over to Randy to get started.
RANDY BERNARD: Thank you, Amy. Let's start with ABC first. As all of you know, we made an announcement this last week that we will have a new deal starting in 2013 with ABC for six years. This will be concurrent with our Versus contract so that both contracts will come up in the same year. We felt that was very important. This is a very good deal for IndyCar as well as ABC. I want to thank ABC for their commitment. I think that says a lot, that they're willing to do a new deal for six years.
It is substantially better for us financially as well as we believe there's a lot of new promotional ideas that will be added in this contract that will help IndyCar. One of them that we're proud to announce here today is that we will have a 30-minute pre-race show for the World Championships on October 16th so instead of just -- we're extending that window an extra half hour. Again, that is the first thing we wanted to talk about.
Secondly is the aero kit. I know that the Iconic Committee 16 months ago made a commitment to have an aero kit as part of the new car for 2012, and let me tell you, I will be the very first one to tell you that no one is more disappointed than I am that we're not going to do it. But we also need to look at the long-term of the future of the sport, and we feel it's very important that we are listening to the team owners as much as possible on this one.
We don't want to see our car counts go from 26 and 27 down to 16 because of an aero kit. The manufacturers have told us it's very expensive, the team owners have told us it's very expensive. Yes, we did reduce the price of our cars and the cost containment of that car was -- we said the number we wanted to use was 40 percent, and we've been able to bring it down substantially. But in doing so there's been some costs that have gone up. Firestone tires next year will increase.
So I think for the long-term of our sport it was best for us to make sure that we were able to have a new car next year with three new engines and make sure that we're providing some great competition. I think the fact that we're going to see direct injection, we're seeing a displacement go from a 3.5 down to 2.2 turbo charged single and dual, I think Tony and Will can sit here and tell you today from simulations we've seen on road and street courses that lap times are three seconds quicker, up to 15 miles an hour faster, and I think these are all great, great stories that we need to get out now, that this car is going to be fast, and that the aero kit is going to be a great addition, but we don't want to do it until it's right. It will happen 2013, I promise you. So that was that.
The next thing I want to discuss real quick is manufacturers. Tony Cotman, our project manager, can go into detail on this. But we think -- we've heard rumors out there that Dallara, all this is going to be European based. That's not true. There will be a minimum of 30 to 40 American manufacturers, a lot of those Indiana based, will be to able on bid on certain parts on this car. It's very important that we try to utilize the best equipment as well as quality and price are going to be the two primary objectives of everything that we put on this car.
With that, Tony, do you have anything else to add?
TONY COTMAN: From my perspective on the aero kits, there's a lot going on. There's a lot going on with the vehicle in 2012, there's a lot going on with the three engine manufacturers to get them up and running. I don't think it's a secret that all three engine manufacturers wanted to and want to produce an aero kit.
I just wanted to clarify one thing Randy said. It will be at the beginning of 2013, not at Indianapolis 2013 like we had talked about introducing at Indianapolis. And if I sit here and look at the time, by the time they get the regulations and we've run through what we need on the new car, I think they'll have basically a year, 12 months, to do their R & D, build, supply and provide what's needed.
You know, I think it's both a matter of delaying a little bit.
THE MODERATOR: And Will, just to clarify, the 2012 chassis remains on track to debut?
WILL PHILLIPS: Absolutely. As you're aware, we had the first shakedown test earlier this week. That was successful. We managed to prove and make sure that some of the base functions of the car, oil, water systems, clutch, interface with the gearbox, all of that, the brakes, vetted everything in, got it up to temperature, and that went really well. You always want to do more than you do the first day's running, but we didn't want to be greedy, so as far as that went, that was successful. We're on schedule. We're running again next week and we'll continue the week after that.
It's a busy schedule, there's another 15 days' testing of the prototype plan before the end of September.

Q. It's a little bit confusing for me to understand the aero kit situation. Just want to double check it. The aero kit is delayed until 2013; is that correct?

Q. But what will change in 2012? If I understand correctly, a couple of teams told you it will be too expensive so it will be reduced for 2013?
RANDY BERNARD: No, with the capital outlay they have to produce for next year with a new car and all the additional expenses, it would be an expense that they can parlay in '13, not '12.

Q. And the car which will be delivered next year, you can put the aero kits 2013 on the car?
RANDY BERNARD: Not in '12.

Q. Not in '12, but in 2013?

Q. So it means you can modify the car coming next year for 2013 with the aero kits?
TONY COTMAN: The car coming out in 2012 will be standard, stock body work, everybody will have the same thing. The platform is still there to do aero kits in 2013. When the aero kits are allowed, then it will be free reign on aero kits.

Q. But that doesn't mean you must have a new car in 2013, as well; you can put the aero kits on the car from 2012?
TONY COTMAN: That's correct, yes.

Q. Randy, did NBC have an opportunity to bid on the network part of the television contract, or did it fall in the exclusive window that ABC had?
RANDY BERNARD: It fell within the exclusive window that ABC had. Some of the things that -- there were some triggers in the ABC deal. If we passed on that deal, we would have to come back to them with the final deal, and if it was better, great; but if it wasn't, it could be very detrimental to the series. So we wanted to give ABC every opportunity to make sure that we could get the best deal possible.
It was rumored that one thing that Versus wanted to do was -- or now NBC Sports Network, if we were to get a deal, they couldn't guarantee that they wouldn't want to move the Indy 500 to NBC Sports network, and I'm not sure that that wasn't in the best interest of our series, either.
This isn't a poker game where you can go out and say I'm going to take a chance. Again, there's a lot of lives that depend on what we do here, and we're going to take the -- we know what we have with ABC. They've done a good job, and we had a three-and-a-half-hour dinner meeting last night on what we can do to improve it. A lot of ideas back and forth, ideas to me on what we can do better, and I thought the Indianapolis 500, which is important to them, and I think that we're going to make some solid, positive moves in the right direction for sure.

Q. But as far as the investment they're putting in, you can in no way quantify how much better it is than the previous deal?
RANDY BERNARD: Actually there is, but it's confidential.

Q. You mentioned the leader's circle is going to be changed for next year, up, down, reorganized. Can you explain that?
RANDY BERNARD: Yeah, there will still remain $26.4 million in that pool, but the way we provide it to the teams will be allocated a little differently, but at this time it's not open for discussion here.

Q. Some people have criticized the esthetic look of the new car saying it's not a good-looking car, and some of the teams have talked about the fact that the side pod, since it's a rolled side pod, doesn't have a whole lot of room for decals to show up. Have you guys looked into that at all or thought about that at all?
RANDY BERNARD: There's actually more space on this car than there is on the current car. This car is 15 inches wider. The question of who didn't like the car, I'd ask you to give me his age. I think that we've done some research on it, and if you go within school districts and ask kids and -- don't forget we're trying to take and build a car into more of a mainstream sport, and this is one of the models that kids wooed and wowed about as well as I've heard a lot of compliments on it. I haven't heard that much negativity. And trust me, when you go on the blogs you can seem to get all the negativity you want, but one of them hasn't been on the look of the car.

Q. Randy, just wanted to ask you a little bit about the delay is strictly a matter of spreading out the expense of ramping up to this new car in 2012 with the aero kit; it's not anything developmental?
RANDY BERNARD: No, it's definitely to help team owners and the manufacturers. It's a big savings for the manufacturers this year, as well.

Q. So it's going to be a uniform standard kind of aero kit with the chassis that they're going to be running next year?

Q. And second part, just about coming here to New Hampshire this year, obviously you guys are kind of waiting to see what kind of crowd turns out. Is this going to predicate what you do in the future here, or is this kind of like the first year deal in terms of an audition, so to speak?
RANDY BERNARD: I wouldn't call it an audition. I think that's a little rough. I think, first of all, Jerry Gappens and Bruton Smith I think the world of, and I think when we decided to have an event here, we knew we were going to have to build on it. The last time they had a race here, I believe there was 7,500, and the race before that there was 8,000, and Mr. Bahre told me himself the most he ever had here was 40,000 for an IndyCar race, paid.
So I think that we knew from day one it was an area we were going to have to work on, but it's an area that we really like and it's a track that we really like, and I think that sometimes you have to invest in your future. Again, this is one of those that's what we're trying to do.
I think that after this is over, I think Bruton and Jerry and I will sit down and try to determine how we can -- if there's a way to put a deal together because I think that it's going to take a couple years to continue to build this, and I think fans will be very excited to see the day. I think from what the drivers and the team owners, everyone is really excited to race today. They love this track.

Q. Is this a one-year deal?
RANDY BERNARD: It's a one-year.

Q. So you'll sit down and discuss it a deal at the end --
RANDY BERNARD: Yes, sir, whether we go forward with next year.

Q. When do you come out with your schedule?
RANDY BERNARD: I would hope sometime mid September.

Q. The releases that have been -- the information that's been released from the test at mid-Ohio, the new chassis, have been kind of vague. Are you able to get into any more specifics, specifically comparisons of lap times with the new chassis, or was this really pretty much nothing more than a shakedown?
WILL PHILLIPS: It was a shakedown. We did not try -- we ran one set of tires, for example, for the entire running that we did. There was just no chasing of lap time. It was proving the systems work.

Q. (Indiscernible.)
RANDY BERNARD: All three manufacturers will have their engine next year.

Q. I'm just interested -- a couple of years ago I sponsored a young American in the Indy Lights series, which he won, and last year he got a few rides. I'm hoping and wondering, in no way to disparage the quality of the foreign participation that we have here, which is essential for the IndyCar Series, but do you have a plan and a real serious methodology for bringing young Americans up and into this series so that we have names like Rutherford, Foyt, Unser, Andretti, household names that people know in this series so that they can really -- kids can identify with?
RANDY BERNARD: Yes, sir. First, let me say that before we pinpoint Americans, I think that it's most important for us to say that IZOD IndyCar Series has to be about credibility and we have to represent the best drivers in the world. We've defined our sport as the fastest, most versatile race car and race car driver in the world. It separates us from every genre of motorsports.
Saying that, we know we need to create an avenue for Americans to come up and compete in IndyCar, and that has to start right from Carter. There's somewhere between 80,000 and 100,000 Carters in the United States, there's five sanctioning bodies. We're currently trying to work with all five sanctioning bodies to help develop at a very young age.
Then moving up into the ladder series, last year we were able to announce Mazda buying the Mazda Road to Indy, which is about $2.3 million in sponsorships, which allows the driver in each support series to move up to the next, so the F2000 can come up into the Star Mazda, the Star Mazda can come up to the Indy Lights, and then Indy Lights hopefully can get a ride in the IZOD IndyCar Series.
The one element or the one rung of our ladder that wasn't successful, J.K. Vernay was not able to make it all the way up. We offered him $1 million to go find a ride. He wasn't successful with that, so we actually offered him $1.5 million to go find a ride, and he wasn't successful even with $1.5 million. So it's going to take some more work to take that last step, but we know how important it is. And it has to be about not always buying a ride. If you're the best driver, we have to be able to ensure there's a way for you to get to the next series, and that's what our goal is right now.
One other thing that I think is important: I think we lost touch with dirt tracks around America, and I think that it's essential for us to try to reinvigorate and engage those fans back into IndyCar. Last year we offered Bryan Clauson, who was the High Point USAC champion, the opportunity to come up and compete in the ovals. That was another thing: We didn't feel that -- we don't want to set him up for failure. We know Bryan is an outstanding oval track racer, and we didn't want to put him in road and streets right from the start and give him a negative opportunity, so we gave him a scholarship of I think it was $325,000 to come up and compete on the ovals.
I believe he qualified second here this weekend, and I'm excited to see how he does, but he's doing very well for his first year in an Indy Lights car. My goal is I hope I can see him next year at the Indy 500 because the dirt tracks resonate to Bryan. Bryan is a big guy with dirt tracks.
So I think that we're reaching out. We've got pinnacles everywhere, we just need to make sure we keep to our objectives and focus on the best of those areas.
THE MODERATOR: I think of note, too, Firestone Indy Lights, is Joseph Newgarden of Nashville, Tennessee, on the pole, Bryan Clauson of Indiana starting second, so you have an American front row in today's race.

Q. You had said the cost for Firestone for the IZOD IndyCar Series is going to be increased by $250,000 for next year. Could you go into more detail on that, and will there be a significant change to the cost for the Firestone Indy Lights teams with Firestone tires?
RANDY BERNARD: Well, next year Firestone won't be producing a tire for the Firestone Indy Lights at this time. We currently are looking at some other tire manufacturers, and then on the other -- as most of you know, last year -- actually in January, Firestone was going to pull out of racing completely, and after some conversations with our team owners and their retailers and us being able to come back to the table, we were able to work a deal. But that deal, part of it is that their tire, there's a significant increase. Do you want to add anything?

Q. That's maybe a question for Tony Cotman. Did you ever think what you can do with the current cars to give the team a possibility to sell it somewhere else, maybe a second feeder series with less powerful engines?
TONY COTMAN: We've thought a lot about what we can do, how to provide an outlet for the current cars and the current team owners. A couple of things still in mind. But I think we have to realize that the current car is so old now that technology has moved so far down the road that we just need to be smart about what direction we decide.
You know, there's been a lot of conversation whether it should be the next Indy Lights car or whether it should be retired completely or whether it can be updated to show cars maybe through body work. So two or three things on the table. But I think we need to understand that, look, it's eight or nine years old now, and technology has passed us by. Whatever we do, we just need to take that into account.

Q. Will, you've worked in the pinnacle of technologies and you're up on formula cars. Kind of give me a sense of where this car places there, and how are you making the decisions? Are you and Tony making the decisions on what technology to go with just for having it?
WILL PHILLIPS: That's coming from Dallara now. There's been a lot of -- we've worked really hard with them to make sure that it is addressing some of the complaints that have been from the past, but when you've got cars that are seven, eight, nine years old, some of them -- most of them aren't that old, but the product is that old, it's very hard to control the quality and the body fit, et cetera, et cetera. With the new car coming, the molds, et cetera, the opportunity to fix that.
In terms of the technology that's on the car, it's not just about cost, although that is obviously a major concern. You can't bring the price of a car down significantly and add every latest technology on there. So that's been one of the reasons why -- making sure that we have a reliable product that we can race at a cost that we can afford to go racing with.

Q. In terms of technologies, which ones did you pick, yeah, we want that one, anti-stall, things like that?
WILL PHILLIPS: Anti-stall will be there. The clutch control mechanism is something new that we've not had in the car, the hand clutch, there are two pedals in the car. There are some features that come at an expense, but they will improve the racing. We want to reduce the number of yellows through spins, so having an anti-stall and a means to control that is part and parcel of making the race being package better.

Q. Can you talk about, a lot of the car industry in Indianapolis is saying the car is going to be built in Italy 100 percent; we don't get a chance to bid on anything. You just said a little while ago they will. What components will they be able to bid on, and when will this be able to take place?
TONY COTMAN: I think the big thing is, look, the prototype car was built in Italy; we've made no secret of that. We've put a pretty quick schedule, pretty hefty schedule to get it all produced on time and get it on track. So to date the prototype was built in Italy. It was assembled in the U.S.
We're just getting to a point now where once we prove that we don't need to make major or any significant changes in whether it's geometry or suspension components or the body work or removing the air box or whatever it may be, we're at a point where we can start to go out and look for or send out RFPs to bid, and we're only just getting to that stage now.
I think one thing to keep in mind is that we've been driving Dallara to provide us a product at a very high standard, and like Will talked about before, some of the body fits, some of those things on the car, is excellent. And when people bid on cars or components, this isn't about making something in your garage that I can turn up and provide a product to a race team or to a single entity; this is about providing product at a high level to an entire series.
You know, honestly, that weans down the pool. So when we talk, there's a lot of local entities that are going to be bidding, they're not all going to be bidding for the same thing; some might be carbon fiber, some might be machine work, some might be suspension, so forth. But at the end of the day, you quickly wean down to a handful in each area that are capable of doing the job, capable of supplying enough product to the series. And at the end of the day, Dallara's responsible to us to provide a top quality product, and we as IndyCar are keeping the heat on Dallara to make sure that they do that. At the end of the day, the teams will benefit.
So it's a difficult process to manage, without question, but we're just getting to the point now where a lot of the big components will be going out.

Q. Randy, this is two questions about next year's 500. Do you think the fact that it's going to be something new, new engines, new cars, may mean an uptick in interest for say practice and pole day?
RANDY BERNARD: I would hope so. We also -- I know that Tony and Will, we've made no secrets that speed is going to be very important in this car, and we want to definitely see an uptick in speed. We want to see this car break the record at some point, but not next year, of course.

Q. I know you've been a big fan, you want to hear the words it's a new track record, return to the Indianapolis Motor Speedway. If this car is capable of doing 15 miles an hour, do you kind of have how long you'd like to have it until they can get up around that 238, 239 range?
RANDY BERNARD: I'm going to let these guys talk. That was on road and street courses where the simulations were done. But I think that our goal is competition, entertainment and value for the fans, and fans love to see track records. They want to see something that has never been done. And we have -- we're about relevance, innovation and speed, three of our biggest brand attributes. And if we can't provide that, are we really what IndyCar was always about. And I think it's very important for us to go back to that.
TONY COTMAN: We have two jobs from our perspective from the technical side: A, to be able to provide a product that can do that; and B, to keep the reins on Randy.

Q. I think this is probably for Will. We're talking here about speed and going faster and so forth. The current car has proved to be a pretty safe car. Is there anything new that's going into the -- has gone into the new car to increase the safety aspect or at least keep it at the same level?
WILL PHILLIPS: The car itself should be a lot safer. You can never -- the incident that poor Justin had at mid-Ohio, that we would not expect to happen with the new car. We can't guarantee it, but the fact that even Justin will be sitting on safety foam and have three inches of safety foam behind his back should prevent that sort of injury. The design on panels that are on either side of the car are more extensive, so all of those features should make the car safer. Whilst we're also on the safety aspect, in terms of the stability of the car, its speed, its characteristics, the overturning moments on the car, all of those are subject to Dallara's wind tunnel and CFD work to try and improve it. So in all those aspects we've been trying to make the new product better.

Q. Tony, you opened the door so I am going to ask it. You mentioned Will would have an air box or not. Is that being discussed again? I thought that was a closed issue.
TONY COTMAN: It's a closed issue with me. I know it's being discussed out there publicly probably on a daily basis. But look, at the end of the day, the air box, maybe we should call it something else. Maybe it shouldn't be called an air box. But the turbo inlet is what it is.
The turbo inlet is in that position for a reason. It was there to provide aero kit manufacturers with maximum freedom without trying to manipulate the rules, and you end up getting air scoops and intake scoops everywhere that end up being deflectors and so forth for the rear wing, trying to eliminate the capability of the rear wing.
So there's a reason it's there. Maybe you could all help me by calling it the turbo inlet. I know the shape of it outside looks like an air box and so forth, that's fine. When the body is off the car and you see the turbo inlets, they're actually pretty cool, and I think once we get to that point, hopefully it'll move some people from the left to the right. I understand we're never going to please anybody, but right now just based off the first test, it seems to be working extremely good. It's a perfect place to have it on the car, and at least in the short-term, I don't see it changing.

Q. I have a question to you, Tony, following up from Mike Harris concerning the safety. With the current rules in IndyCar for next year, is it part of the IndyCar rules like in Formula 1 when a new car has been produced to make a crash test like is mandatory in Formula 1?
TONY COTMAN: Yeah, it has been. Will, you were at the most recent crash test, right?
WILL PHILLIPS: I witnessed last month in Italy, some at Milan University, some of them carried out at Dallara, the specifications are as rigorous as the current Formula 1 regulations, so the tests that have been carried out on the roll hoop, the side stiffness of the car, the floor of the car, the nose pushing-off tests, the front impact tests for the nose, they've all been carried out and have all passed successfully.
TONY COTMAN: I think one other thing I wanted to add to try to enhance safety is the tail section of the car behind the rear wheels. You know, we've seen a lot of incidents over the last couple years where there's been wheel-to-wheel contact and cars flying. And Dallara spent a lot of time on the tunnel not just with the aero effect but with the height of it, how it's going to work, if there's contact from nose to tail, what breaks off first, and obviously one of the goals is to stop like the Conway incident at Indianapolis a couple years ago, to try and reduce the risk of those incidents.
Again, it looks different and the back of the car has a lot of -- there's a large under wing and a lot of diffusers back there. Looks a bit like a sports car. But if it can achieve what we want, then we'll be pretty happy.

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