Donald Trump's tariffs create "uneasiness" for IndyCar teams

The cost of operating an IndyCar team has grown exponentially since the hybrid power units were introduced midway through last year. With teams already struggling in terms of finances, US President Donald Trump recently revealed the new import tariffs which are set to make things even more complicated for the teams.

With the new financial year underway, Trump released the updated tariffs for imports from different countries. One of the updates was a 10% baseline tariff on all imported items. With the open wheel racing team acquiring the majority of the parts from foreign suppliers given the spec series nature of the series, the increased tariffs are bound to come out of the owners' pockets.

AUTO: AUG 19 IndyCar - Bommarito Automotive Group 500 - Source: Getty

Meyer Shank Racing's Co-owner Mike Shank detailed the same as he looked at the effect on all the motorsport series including IndyCar and IMSA WeatherTech Sportscar championship. He said (via Racer):

“In general, we’ve had a huge drop in the Dow and all of our companies that are doing things with us are listed companies.The uneasiness is not helpful right now; tariffs, obviously, are part of that uneasiness. My personal belief is we’ll get through this and we’ll move on, but it is not awesome, right?”

“And yeah, we have to have planning for what if A, B, or C happens in regards to cash flow and how we’re going to get through this.Everybody’s going to be dealing with the same thing,” he added.

The tariffs will be implemented on parts like the chassis and aerodynamics packages, which are designed and produced by the Italian manufacturer Dallara. The wheels are imported from the German company BBS while the MGU unit comes from Dutch manufacturer Empel. And all this is just scraping the surface of the parts that are imported to put together an IndyCar.

As per the new tariff policy, there will be a 20% surcharge on imported parts like Chassis and wheels. With the new tariffs, the staggering cost is only bound to get heavier on the owners' pockets.

---

Mike Shank on IndyCar's rising costs: Sustainably, we cannot keep doing that

The current generation IndyCar with the hybrid motor entry costs a team anywhere nearly $10 million to fund a full season entry. The same was in the range of $6-8 million before the introduction of the hybrid technology.

SiriusXM's Brick By Brick Broadcasts From 2022 Indy 500 Carb Day At Indianapolis Motor Speedway - Source: Getty

Mike Shank came out after the 2024 IndyCar season and detailed part of the reason for the rising costs that teams are facing. He said:

"The increase for ‘24 was ridiculous. It was beyond 40 percent. Sustainably, we cannot keep doing that. And IndyCar knows that. Prior to that, we were up 10, 12 percent prior to the big hybrid spend."

The open-wheel series planned on introducing ways to reduce the budget by implementing wheels made out of aluminum alloys rather than magnesium alloys, but the same has been pushed back to 2027, as the series plans on introducing a new chassis.