Regan Smith's team works on his Chevrolet in the 2008 Daytona 500 race. General Motors has sponsored Daytona for more than 40 years. (Marc Serota / Getty Images)
General Motors Corp. has renewed its decades-long sponsorship of the Daytona International Speedway and its signature stock car race, the Daytona 500, but at a cheaper price.
And instead of a multi-year deal, the cash-strapped automaker will sponsor NASCAR's most prestigious event on a year-to-year basis. Financial terms were not disclosed.
The renewal ends speculation that GM's money woes, which have triggered a scaling back of corporate sponsorships, would force the automaker to terminate sponsorship of an event that was the top-rated motorsports telecast in North America last year. The multi-year deal expired Dec. 31.
GM finalized the new deal Dec. 19, the same day President George W. Bush announced the Detroit automaker and Chrysler LLC would receive up to $17.4 billion in short-term loans.
"It was a coincidence that the agreement was signed the same day we got the bridge loan," Chevrolet spokesman Terry Rhadigan said. "It was in the works when we started discussions back in the fall. Let's just say it's a fraction of what it had been in previous years, dollar-wise."
GM has sponsored Daytona for more than 40 years, and motorsports in general provide a prime marketing opportunity for automakers to reach customers who buy domestic vehicles at a rate higher than the national average. The race, which last year drew 33.5 million television viewers, is Feb. 15.
But the automaker's financial troubles and slumping sales have forced cuts. GM has lost almost $73 billion in the past four years, and its U.S. sales fell 23 percent last year amid the worst industry-wide sales slump since 1992. It risked running out of money last month before Bush approved the loans.
GM has recently ended other marketing opportunities, such as an endorsement deal with PGA golfer Tiger Woods, and has pulled out of advertising during Super Bowl XLIII, the prime-time Emmy Awards and the 2009 Academy Awards, among other moves.
"We are able to draw a direct correlation to sales, and that's where we are going to put our money," Rhadigan said. "We need to be smart with the limited funds that we have and focus those funds where we are going to provide the highest return on our investment."
GM provides fire and safety vehicles, pace cars and other vehicles for the race, as well as a July race at the track. GM did not disclose how much it spends on the Daytona deal or NASCAR sponsorships.
"It works very well for us in reaching one of our fan constituencies that we market our cars and trucks to," said Jeff Chew, marketing manager of Chevy Racing.
GM essentially creates a showroom floor on the speedway grounds each year and next month will spotlight the Chevrolet Camaro, Malibu, Silverado hybrid pickup truck and Equinox crossover.
"We're very pleased to have them back as a partner," Daytona spokesman Andrew Booth said. "We've had a great relationship with them, and they've been a great partner to us."
Last year, GM had sponsorships at 12 tracks that host NASCAR events, including the Indianapolis Motor Speedway, but three of those sponsorships have not been renewed.
Chevrolet also is the official vehicle sponsor of the Chevy Rock & Roll 400 held in September at Richmond International Raceway in Virginia. That sponsorship expires this year.
GM is sending a signal to NASCAR viewers and consumers in middle America by renewing the Daytona deal, said Wes Brown of the Los Angeles marketing research firm Iceology.
"By remaining a partner, GM may project some level of stability and security," Brown said. "By pulling out, it would have made the battle that much harder to convince these kinds of consumers that GM is still in the marketplace."