Coca-Cola Co. (KO), the world's largest soft-drink maker, won a 10-year contract to provide soda and bottled water at Daytona International Speedway and other tracks owned by International Speedway Corp. (ISCA), ending PepsiCo Inc. (PEP)'s 50- year tie with the circuits.
Six tracks will begin pouring Coca-Cola sodas and Dasani bottled water in January, Atlanta-based Coca-Cola said today in a statement. Four more Nascar tracks, including Talladega Superspeedway in Alabama, will switch to Coca-Cola from PepsiCo over the next few years when their existing contracts expire. Financial terms weren't released.
The agreement makes Coca-Cola one of International Speedway Corp.'s top five sponsors along with Sprint Nextel Corp. and General Motors Corp., ISC spokesman Lenny Santiago said. Coca- Cola and PepsiCo have run competing sponsorships in the racing league for decades, and the pair competed for viewers at the Super Bowl as Coca-Cola ran its first ads during professional football's championship game since 1998.
``Several of these contracts were coming up for renewal, and it's the normal process to go into the market and make sure we're getting the full value of these agreements,'' Santiago said. ``It became a mutual thing for us to part ways.''
International Speedway, the biggest U.S. auto racetrack operator with 13 tracks, gets about 15 percent of total revenue from sponsorships such as these, he said. Coke also will sponsor the February Nascar races at Daytona International Speedway. The last Pepsi 400 race, the name of Daytona's July race since 1985, was run this weekend.
International Speedway is based in Daytona Beach, Florida, and is controlled by Florida's France family, which also owns Nascar. Nascar bills itself as the second-most-watched sport on U.S. television after the National Football League and claims about 75 million fans.
Coca-Cola products will be served at tracks in Daytona; Chicago; Miami; Kansas City; Brooklyn, Michigan; and Richmond, Virginia, next season. Darlington Raceway in South Carolina will switch in 2009; Talladega and New York's Watkins Glen will be changed in 2011; and Phoenix International Raceway will start using Coke products in 2012.
About 7,000 gallons of soda are served during events at the 2 1/2-mile Daytona track, ISC's largest, Santiago said. He wouldn't say how much soda is served at all the tracks combined. Food, beverage and merchandise accounts for about 11 percent of ISC's total revenue.
PepsiCo, which has had soda pouring rights at Daytona for 50 years, will continue to serve its Gatorade sports drinks at all ISC tracks. PepsiCo also retains soda rights for International Speedway's tracks in Virginia and California whose contracts haven't expired, Santiago said.
PepsiCo serves its soft drinks at other independent tracks including New Hampshire International Speedway and Pocono Raceway in Pennsylvania, PepsiCo spokeswoman Nicole Bradley said. PepsiCo also sponsors the car driven by Jeff Gordon, who has been a pitchman for the Purchase, New York-based soft-drink maker for a decade, she said.
Shares of International Speedway fell 41 cents to $53.46 at 12:31 p.m. in Nasdaq Stock Exchange composite trading. Coca-Cola shares gained 5 cents to $52.65 in New York Stock Exchange composite trading, and PepsiCo lost 7 cents to $66.15.
To contact the editor responsible for this story: Michael Sillup at firstname.lastname@example.org.