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Common Sense Prevails in Alex Palou-CGR IndyCar Drama

Finally, after almost two months of back-and-forth with lawsuits filed by both sides, common sense has finally won in the case of Alex Palou and Chip Ganassi Racing with the announcement that Palou will drive for the team in the NTT IndyCar Series in 2023 after all.

To make a long story short, in mid-July, CGR announced that the Spaniard would be returning to the IndyCar operation, with the then defending series champion quoted in the press release. A couple of hours later, Palou sent these tweets out:

A few minutes later, McLaren announced that they had signed Palou in a since deleted press release on their website. Then, a few weeks after this mess, an even bigger but somewhat similar incident happened in the world of F1, in which Alpine announced that Oscar Piastri would drive for them in 2023 before Piastri came out in almost the exact same fashion as Palou and announced on Twitter that wouldn’t be happening either.

Piastri was linked to McLaren almost immediately after this tweet came out.

There was plenty of heat on McLaren for having been at the center of not one, but two different contract controversies, with it creating a third one after the revelation that Piastri had a signed deal to take Daniel Ricciardo’s seat with the team almost two weeks prior to Ricciardo announcing that he would still drive for the team in 2023.

The reality, however, is that the Piastri situation, it turned out, was almost entirely due to Alpine not having any deal with Piastri whatsoever in 2023, with his 2022 contract a rush-job. The team didn’t realize Piastri wasn’t under contract as a reserve driver until four days before the first race of the season. You know it’s a bad situation when Alpine had to pay all legal fees in the case due to wasting everybody’s time.

Meanwhile, while it’s unclear how Palou’s contract with CGR was structured, clearly it is much more valid for 2023 than Alpine’s proposal they wrote for Piastri on a kid’s coloring menu while waiting at Applebee’s. Otherwise, this is a completely different column, especially considering Chip Ganassi was rumored to have put an asking price of $10 million to break the contract for the young driver.

There are two major reasons as to why Palou would want to break the contract on the surface, regardless of what, if any, internal reasons there are. Ganassi seemed to trigger an automatic option in Palou’s contract, which means less money for Palou. If Palou’s original deal was for two years and then a one-year option, that contract was signed before he won the 2021 championship and thus, the terms were probably not favorable to Palou monetarily considering his success.

This may seem greedy, especially considering Palou’s age, but the reality is IndyCar racing is an exceedingly dangerous discipline of racing. Robert Wickens’ extremely promising IndyCar was cut unfairly short when a wreck left the Canadian paralyzed in 2018, for one very obvious example. An athlete should rarely be faulted for wanting more money to secure their future while they compete in a sport with no pension.

The other is that, well, McLaren has an F1 team and every young driver in IndyCar would love to get their hands on a car to test. Palou is automatically qualified for an F1 Super License for the next couple of years thanks to his IndyCar championship, so it’s just a case of finding seat time and trying to impress the right people.

Colton Herta, who doesn’t have the SL points needed to make the jump to F1 without special permission from the FIA, has already attracted not one, but two interested F1 teams. Helmut Marko of the Red Bull Junior Driver Program has outright said he has a deal to sign Herta to an AlphaTauri seat, while Alpine has scheduled the American to test their 2021 car next week. And that’s all from a really good test with McLaren over the summer.

But the agreement that Palou now has with CGR is allowing him to do those F1 tests for McLaren, beginning with this week at Spain with Pato O’Ward. So at the very least, that aspect of the deal is a big plus in Palou’s favor, especially with the F1 driver market for 2023 looking very crowded for how few seats are still open; it’s better to be looking for a 2024 seat than a 2023 seat.

Everything ended up working out for CGR at the end of this whole ordeal. They had options for the No. 10 car for next year, but none as good as Palou at this stage of the game. The team also may be down a driver and sponsor anyway heading into 2023, with Jimmie Johnson being tied to Carvana and Johnson still figuring out what exactly he wants to do next year. Entering next month potentially needing to figure out half of the team’s makeup doesn’t sound like a great situation to be in.

McLaren, meanwhile, is fine. Felix Rosenqvist will race in IndyCar now instead of being packed in a box and shipped off to Formula E, which is also fine. One advantage Zak Brown has to signing a lot of talent on the market is that when he misses out on a prospect like Palou, there are still plenty of bullets left in the chamber.

It’s an open question, however, how many resources he’s going to put into developing young talents like Herta or Palou for F1 when he is potentially locked-in for a very long time with young guns Lando Norris and Piastri driving for the team in that series.

For all involved, however, ending this now and not six months from now or even, God forbid, a year from now is a definite benefit. Nobody really gets to waste a year under this deal; even if Palou goes to third banana internally at CGR, he’ll still be able to make waves if he’s able to with McLaren tests next year. And of course, with Herta potentially out of the door, losing Palou as well would have been a bad hit for the overall health and future of the series. It’s sloppy, but at least it’s not a disaster.

About the author

Michael has watched NASCAR for 20 years and regularly covered the sport from 2013-2021. He moved on to Formula 1, IndyCar, and SRX coverage for the site, while still putting a toe in the water from time-to-time back into the NASCAR pool.

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