A Driver With Two Contracts – Trying To Make Sense Of Alex Palou’s Situation In IndyCar

It was a tumultuous Tuesday for the NTT IndyCar Series when in a period of four hours two different teams announced defending champion Alex Palou would be racing in their cars in 2023.

It was the latest episode in what is turning into a bitter war between rival team owners Zak Brown of Arrow McLaren SP and Chip Ganassi.

Palou is in his second season as the driver of the No. 10 NTT Data Honda at Chip Ganassi Racing. He joined the team after the 2020 season when the driver from Spain finished an impressive rookie season with Dale Coyne Racing/Team GOH.

Success with the Palou/Ganassi combination was quick. He drove to victory in his first race for the team, the 2021 season-opener at Barber Motorsports Park. Palou joined Michael Andretti and the late Dan Wheldon as the only drivers to win in their first race for Chip Ganassi Racing.

That’s pretty impressive considering Juan Pablo Montoya, Scott Dixon, Dario Franchitti and Tony Kanaan are all big-name drivers who have raced for the team during their careers.

Palou would go on to win three races and the 2021 NTT IndyCar Series championship by 38 points over Team Penske’s Josef Newgarden.

Along the way, the Spaniard spread his good cheer and good nature and appeared poised to be the driver that would lead Chip Ganassi Racing to more greatness when the great Scott Dixon decides to call it a career.

He started the 2022 season with a second-place finish in the season-opening Firestone Grand Prix of St. Petersburg, was seventh at Texas Motor Speedway, scored a third place at the Acura Grand Prix of Long Beach and finished second in the Honda Indy Grand Prix of Alabama at Barber Motorsports Park.

He appeared happy and cheerful during the month of May at the Indianapolis Motor Speedway, despite an 18^th-place finish in the GMR Grand Prix on the road course and a ninth place in the 106^th Indianapolis 500.

Looks were deceiving, however.

During the offseason, presumably Palou wanted to renegotiate his contract with Ganassi. He believed a championship in his first season with the team should have earned him an increase in salary. Ganassi wanted to stick with the two-year deal that had an option year for 2023.

Drivers in the IndyCar paddock began to hear the rumors that there was dissatisfaction between Palou and CGR. To the fans and media, Palou acted as if nothing could ever be better than racing for Ganassi. But privately, McLaren CEO Zak Brown was interested in Palou’s availability.

It’s not certain who approached who, but both sides were interested, and Brown could offer Palou something no other team in IndyCar can – a Formula One test at McLaren.

That has proven to be Zak Brown’s “Secret Weapon” according to the elite drivers in IndyCar.

“Yeah, man, I wish there was Zak Brown around when I was that age, when I first got to IndyCar, because I know I would have got a chance in Formula 1,” Team Penske’s Will Power told me. “It’s cool to see that because I know how that feels.

“It’s a great opportunity. I think it’s just so fantastic to have a team like McLaren and Zak Brown in IndyCar. I think it’s great for the series. It’s good for the young guys here obviously.

“I think it’s great what Zak Brown is doing, I do. Cool to see.”

When Brown and McLaren joined forces with Arrow Schmidt Peterson Motorsports in 2019, Brown wanted to remake the team by stockpiling young talent already in IndyCar. The popular James Hinchcliffe was told he would not be back with the team the following year. Young Pato O’Ward of Mexico was signed to the team along with young Oliver Askew of the United States.

Askew would eventually be replaced by Felix Rosenqvist of Sweden.

But Brown wasn’t done in remaking the operation.

The team announced on Carb Day at this year’s Indianapolis 500 that O’Ward had been signed to a new contract. One week later, the team announced Alexander Rossi would join Arrow McLaren SP in 2023 after Rossi’s contract with Andretti Autosport concludes in 2022.

Brown wasn’t finished.

By the time the teams arrived in Detroit for the Chevrolet Detroit Grand Prix the first weekend in June, word leaked out that Brown was making a bid at Palou.

The driver shrugged off the rumor and said he wasn’t looking to leave Chip Ganassi Racing and he was focused on winning more races and championships.

“I think that’s good, always having your name out there is good because they want you to be part of the team,” Palou told me on June 3 at Detroit. “But I’m good where I am. I’m super happy here. I’m not the guy looking for dollars now. A little bit more a little bit less isn’t going to change my mind right now. I go for wins; I’m not going for dollars right now.

“I’m under contract for this year. I’m good where I am.

“Even when I signed the first contract with Chip, I couldn’t say how much….”

There was a moment in June when it appeared Brown was interested in six-time NTT IndyCar Series champion Scott Dixon, which potentially included an ownership stake in the team.

“I think — you threw “potential” in there a load of times,” Dixon said on June 29. “I haven’t been a part of any of these conversations, so not really sure where a lot of these things come from.

“Obviously people talk. I even got a few messages from people asking about the same thing. If people are having those conversations, I haven’t been a part of them. For me I love doing what I’m doing, I love being a part of the team that I’m with, and who knows what comes in the future, but as of right now just focusing on this season. Yeah, that’s all I’ve got to say really.

“There’s nothing to it.

“As of right now, it’s not on the radar.”

On June 23, Rosenqvist was signed to a “McLaren” deal, which at the time said he would either compete in IndyCar or in Formula E.

Brown was apparently making sure he was covered in case he could not get another young driver to round out the team’s three seats in IndyCar in 2023.

Two weeks ago, Chip Ganassi said he expected his team to be “status quo” in 2023. That would have meant all four of the current drivers – Scott Dixon in the No. 9, Palou in the No. 10, Marcus Ericsson in the No. 8, Jimmie Johnson in the No. 48, and Tony Kanaan in an Indy 500 entry – would be racing in Ganassi Hondas in 2023.

And that is what led us to “Tumultuous Tuesday,” July 12, a day that will reverberate throughout the remainder of the season in the battle for control of Palou’s contract.

Confusion Reigns

The day began with an afternoon announcement by Chip Ganassi Racing that stated Palou would be back with the team for 2023.

“Chip Ganassi Racing (CGR) announced today that the team has exercised its option to extend Alex Palou through the 2023 season,” the release said. “Palou won CGR’s 14th IndyCar championship in 2021, also becoming the first Spaniard to ever win the season title.

“Alex’s track record speaks for itself,” said Team Owner Chip Ganassi. “He’s a proven champion and one of the most formidable drivers in the world. We are very excited to continue working together.”

But, at 7:18 p.m., McLaren issued the announcement that would shock IndyCar and create a rift between the two teams as they head into this weekend’s Honda Indy Toronto at Canada’s Exhibition Place.

Once again, the release came from “McLaren” and not “Arrow McLaren SP” and said it would be determined at a later date which series Palou competes in.

“We have always said that we want the best talent at McLaren, and it’s exciting to be able to include Alex on that list,” Brown said. “I’m also looking forward to seeing him get behind the wheel of a Formula 1 car as part of our Testing of Previous Cars (TPC) program alongside Pato O’Ward and Colton Herta as we continue to build our driver talent.

“Alex is an incredibly talented driver who has won in every series he has raced in, and I’m happy to welcome him to the McLaren family.”

Tuesday’s announcement means Brown and McLaren have raided Ganassi of one of his top young talents, a driver that could have anchored the team for seasons to come.

“I’m extremely excited to join the driver roster for such an iconic team as McLaren,” Palou said. “I’m excited to be able to show what I can do behind the wheel of a Formula 1 car and looking at what doors that may open. I want to thank everyone at Chip Ganassi Racing for everything they have done for me.”

According to McLaren, Palou will also test with the McLaren F1 Team as part of its 2021 MCL35M F1 car testing program with fellow drivers Pato O’Ward and Colton Herta in addition to his racing duties in 2023.

To add to the confusion, Palou is quoted in the CGR release that says he will race for the team in 2023.

“It’s a great feeling knowing I’ll be back with Chip Ganassi Racing next season,” Palou was quoted in the Ganassi release. “The team welcomed me with open arms from day one, and I’m excited to continue working with Chip, Mike Hull, the folks on the No. 10 NTT DATA car and everyone within the organization. The goals remain the same and we will continue to work relentlessly towards achieving them.”

However, Palou said he never issued that quote that was used in the Ganassi announcement.

At 7:14 p.m. Eastern Time, Palou said the following on Twitter:

“I have recently learned from the media that this afternoon, without my approval, Chip Ganassi Racing issued a press release announcing that I would be driving with CGR in 2023. Even more surprising was that CGR’s release included a ‘quote’ which did not come from me.

“I did not approve that press release, and I did not author or approve that quote. As I have recently informed CGR, for personal reasons, I do not intend to continue with the team after 2022.

“This evening’s unfortunate events aside, I have great respect for the CGR team, and look forward to finishing this season strongly together.”

Hinchcliffe, who was on the short end of the the McLaren takeover of Arrow Schmidt Peterson, said it’s a “carefully crafted situation” by both parties and believes legal advisors for each team were involved in Tuesday’s statements. Hinchcliffe made that comment on the Peacock streaming network’s “NASCAR America ‘Motor Mouths’” Wednesday night.

Palou has a second-straight IndyCar championship in site. He is fourth in the championship, just 35 points behind the leader, teammate Marcus Ericsson, with eight races to go.

Considering the acrimony that has become public, at this point, is that even possible to finish the season with a championship while having attorneys determine which contract will be enforced in 2023?

I posed that question to Power on Wednesday.

“I’ve heard rumors around the paddock of exactly what’s transpiring right now,” Power said. “Yeah, it’s kind of good for the series really to have a bit of action in the paddock.

“I don’t know the details of everything that has gone on there. It’s going to be interesting to see how that whole things plays out.

“I think that’s been a distraction all year for those guys because this whole thing has been going on behind the scenes. It’s not ideal if you’re fighting for a championship within a team. Definitely not ideal.

“I have not seen this in IndyCar. This sort of thing goes on obviously all the time, various businesses. It’s just one of those things where it’s going to come down to the wording in the contract simply.

“It can make some drivers perform better and some perform worse. Yeah, some need that sort of pressure to bring the best out of them, and some don’t do well under those situations.

“Ideally, I think you want everything settled and you want pretty good vibes in the team. But it totally depends on the individual.”

As for Dixon, he remains Palou’s teammate and enjoys having him on the team at Ganassi.

“It’s hard to equate at the moment, there’s lots of talk out there, but it’s between Alex and the team and nothing I know much about at this time,” Dixon said. “I’m sure there will be lots of news this weekend, which way that is going to go.

“This doesn’t involve me so it’s easy for me to push aside. It is a team member but all of us work as a team, but when it comes to the race, we work as a single car and try to win the race. None of that will change this weekend.

“Hopefully, Ganassi can sweep the podium.”

From a racing standpoint a 1-2-3 Ganassi finish could happen considering the talent on the team. But Brown and McLaren are laying the groundwork for many podium sweeps in IndyCar in the future.

Before that happens, however, it has to be determined which contract legally binds Palou to which team in 2023.