CHAMP CAR MEDIA CONFERENCE

September 20, 2005

Steve Johnson

STEVE JOHNSON: Thanks, Eric. It's great to be here. I'd like to make a statement, if I could. I'm very excited to be able to have my first of what will be many Champ Car media updates. I view all of you as our allies and partners, and without you, Champ Car would not be in the enviable position it is today. Our organization and series is on solid ground with a focus, business plan, focused ownership group, and a focused executive team leading the charge. I use the word "focus" because I view that as a key element of our current success and momentum as well as what will drive our future. We're focused on our fans. We're focused on our teams, our sponsors, our track partners, and most importantly delivering the ultimate entertainment value worldwide to automotive sporting and motorsports enthusiasts. It's my honor to be here on this call.

STEVE JOHNSON: Well, this is really an exciting time for me. It's probably somewhat a funny story on how I got into motorsports. I originally came out of corporate America where I went to work at General Electric. At GE, we were quickly bought by Black & Decker. I left Black & Decker to go for an opportunity to go with Fortune Brands, vice president of sales with the Master Lock Company. I left there and went to Allied Signal, which is now Honeywell. That was my first experience in the automotive area because I had the brands of Fram, Autolite, Bendix and Prestone. I was at Allied Signal, again, now Honeywell, happened to be the grand marshall at an NHRA event in Atlanta, Georgia. It was one of my first big major sporting events, motorsports events, to go to. As I stood on the starting line between I think it was Eddie hill, the Pennzoil car, and Kenny Bernstein, the Budweiser car, standing between 16,000 horsepower, I was standing next to the president of the NHRA, when the cars took off, I think they had to pick me off the track, I wasn't sure what hit me, I turned to them and said, "This is the coolest thing I've ever seen in my life. Why doesn't anybody know about this sport?" Dallas Gardner, who was the president at the time, said, "We're trying to get to that next level. Would you be willing to come over and help us?" I said, "Sure." That's how I got into motorsports. I spent four years at the National Hot Rod Association as the vice president of sales, then I went to the Sports Car Club of America, president and CEO of both SECA, Inc., and SECA Pro Racing, which is one of the other companies. I was there for five years. Now I'm on day two at president of Champ Car. It's been a fun two days, let's put it that way.

STEVE JOHNSON: Well, it's very special. The hurricane, you know, we've all lived through this now. It's a part of our lives. It's affected every one of us. To see the way the Champ Car family has come together and rallied around this great cause, you know, I'm just really looking forward to going to Las Vegas and being a part of it. This is something that's not going to end after Las Vegas. Champ Car is committed to helping. You're going to see more initiatives on our part to help out the hurricane areas and all the folks. As we're talking about it today, there's another hurricane hitting Florida. So our thoughts and prayers are with all of those people in that area, as well. Let's hope they get through that unscathed.

STEVE JOHNSON: Why did I know that question was coming (laughter)? You know, I've had that on almost everybody that's talked with me. If you remember earlier, I said "focused." What Champ Car is focused on is our business and our business model and we're not focused on what's IRL is doing, we're not focused on what NASCAR is doing. I was asked about reunification. The only unification that I'm focused on right now is making sure that everybody that's involved with Champ Car is on the same page, moving the same direction with the same goals in mind. It's not a priority of mine to reunify and to focus on the IRL.

STEVE JOHNSON: As far as Trans-Am goes, I haven't had a chance to talk to Paul Gentilozzi yet. Champ Car has Trans-Am I believe until November 1. They have to let us, I'm talking with the SECA hat on, they have to let the SECA know by November 1st if they're going to continue with the series. All indications are that they are. As a matter of fact, next week I'm going to be at some -- with some potential sponsors talking about Trans-Am. Right now I would say that it looks like Trans-Am will be back at Long Beach, but there's still some things that have to be done. I'll get some updates from Paul later on. As far as the World Challenge Series goes, you know, that's something you'd have to talk to Jim Michaelian on. He's pretty much the one setting the schedule out there for Long Beach.

STEVE JOHNSON: Well, the motivation, I've grown up with watching CART, watching open-wheel racing. To have the opportunity to jump into what I think is one of the top motorsport jobs in the world as the president of Champ Car is something that I couldn't turn down. Now, I also had the opportunity to spend a lot of time with Kevin and with Gerald Forsythe, with Paul, those guys are great salesmen. They are as committed to anything as I've ever seen. They had me so excited, I don't want to tell them now, I might have done this job for free the way they had me pumped up. Anyway, that's the motivation. This is one of the leading motorsports organizations worldwide. Yeah, we've got challenges in front of us, there are certain priorities. I'd have to say our No. 1 priorities is working with our race teams, putting healthy race teams out on the track for our fans and for our sponsors. That's the first area. Obviously marketing is a major area that we're working on, and television. Those are three high priorities as we move forward.

STEVE JOHNSON: That's a great question. Just so you know, we are in talks with several other teams, so I see that number growing, and growing rapidly. Speaking of growing, take a look at what's happened with Atlantics. I think they've sold now 36 or 37 Atlantics for next year, which is a real healthy sign for our entire sport. But we're working on, again, creating value. That's what this series is all about. It's about an entertainment value. It's not an accident that we're averaging now -- that we'll average 150,000 people per event. We'll have 2.1 million spectators at our 14 races this year. Next year with 16 races, we'll be over two and a half million spectators. Not many organizations are able to do that. Again, it's not by accident. We're following our business plan. We're adding value. By doing those things, the return on investment is going to increase significantly for the teams. I've had a lot of discussions already with the team owners. We're in some major negotiations right now with several sponsors that are not only team sponsors but series sponsors. Boy, all I can say is stay tuned because we're going to have some big announcements coming up that has a lot to do with our teams as well as series. So things are actually looking very good there.

STEVE JOHNSON: Well, again, it really comes back down to what we do. We put on probably the best entertainment value there is in racing with the festivals that we're putting on. So we're handling it at the event level. You've been to the races. When you go to Denver, it's a different fan, a different fan base. When you see 150,000, the youths are there, the kids are there. It's a diverse group you see. Those are the Champ Car fans of tomorrow. We still have the loyal Champ Car fans that are out there, as well. So we really got a couple different markets that we're going after. Will Wilson, our executive vice president of sales and marketing, has come here from the NFL. He's been on board for four months. He's really put together a strong marketing plan. We're not going to be shy about this stuff. We're going to be sharing all those things with you, as well as our strategic plan when we finalize that. You're going to see that. That will answer a lot of your questions in a more detailed fashion. The other thing we're going to do is work on improving our television package, which is very important for us. We're in TV meetings, actually I believe there's a conference call going on right now on television, things they'd like to see. Just stay tuned with that because we're not going to keep that stuff a secret. We're going to get that out so the media sees it and is on board with what we're doing.

STEVE JOHNSON: Well, I would like to say yes, but we had a major storm come through Indianapolis last night, and the hotel that I'm staying at, the satellite was lost. Not only didn't I get to watch that, I didn't get to watch anything. I sat in there in my hotel room and read. I'm going to get a copy of it this afternoon and I'm going to view it. I can tell you, I had many emails today from both Champ Car officials and sponsors, as well as Champ Car fans. I haven't heard anything negative. Everything has been very positive, telling us they'd like to see 52 episodes. Well, funding is a wonderful thing, and it's something that we're working towards, to fund more of those type of shows. From what I hear, it's been very positive.

STEVE JOHNSON: I can comment, but I probably won't give you any more information than you already have. The new car, we're probably two weeks away from announcing the '07 chassis. Without tipping our hat, we haven't selected yet who that is going to be. Whichever way we go, it's going to be a major win for the series as well as for the team owners. The car looks fantastic. When we announce that, we're going to have a separate press conference on that so you can see it and be a part of that. As far as the schedule goes, yeah, we are looking, it's no secret we're looking to add another race for '06. If Philadelphia has a secret, it's probably the worst-kept secret there ever was. But we are in discussions with Philadelphia as a market. The TV package is just not done yet. Again, as I said, they're on a call right now. We're working towards finalizing that and getting out very soon. The good news, all three of those are very positive. We look to have those done here in the real short-term.

STEVE JOHNSON: Well, I think, you know, probably all of it. With the SECA, when they got involved with drifting, Champ Car is involved with drifting now, the same organizations. You know, we're going to partner with SECA in certain areas. We already do from a race official standpoint to corner workers. Many of the members of the 60,000 SECA members are avid fans of Champ Car. We're going to continue some of our partnering efforts with the SECA. If you take a look at the festivals we put on on the weekend, it's not just racing. There's BMX competitions going, there's car shows going, there's a number of things, video games. There's a number of things to get the youth involved and educated on what open-wheel racing is and what Champ Car is because we have to do that. That's tomorrow's fans. Those are tomorrow's drivers for us. You're going to see a lot of areas towards the youth initiative as well as to our loyal fans that have been following us forever. We're not going to abandon them. They're very important for us.

STEVE JOHNSON: I don't know "change." Everything's changing that we have. One of the things I'm working on right now, and I've been working on for the past several weeks, is working on the strategic plan for the organization. You know, we're not there yet, but it will be out soon. It's not going to be anything that we keep secret locked up here in the cabinets. We're going to share it with all of you. I think you're going to see that, and that's going to drive a lot of the decisions that we make. Again, it comes back down to being focused and being unified as an organization with the same goals and objectives in mind. You're going to see a lot of things from me initially on the marketing side because, quite frankly, that's my background, is sales and marketing. I'm already jumping in on that right now. We've got some meetings lined up in Las Vegas that are pretty far down the road. If we can get these finalized, you'll see some big announcements coming out of Champ Car. A lot of that. Then communication. It's another area that I don't think anybody can do good enough in, and you're going to see us continue to improve our communications, both internally and externally. You, as the media, will definitely feel it and see it.

STEVE JOHNSON: That's a great question, but it's one that I don't have the answers for yet as being in day two. I haven't been fully debriefed on what's going on in Montreal. I do know that we're planning on being back in '06. It's a great market. If the question is, "Would we want to be there in '07?" Absolutely. It's a great market for us. I hope everything gets worked out and we'll give it our best efforts from the Champ Car side to make sure that we put our best foot forward and make that happen.

STEVE JOHNSON: Well, I do. That's a great question. Champ Car is again doing a lot of things right. It's not an accident they have 150,000 people per event. The operations side of the business with Tony Cotman and his group, I think have increased the confidence level in what Champ Car is all about. You don't hear those issues any more. Last year and in the past, when people talk Champ Car, it was operational challenges, bad calls, things like that. Whether they're right or wrong, I don't know, I wasn't here. They've done a lot of really good solid things. They've put together a great executive team that I'm very comfortable with. I was fortunate to be able to know these guys because I'm in the industry. I've known them prior to taking this job. That was another one of the reasons why I wanted to become a part of the Champ Car World Series. Anybody that's in motorsports for a long time has a large Rolodex, and we bring that with us, a lot of contacts. We need to get more mainstream, we need more sponsors, we need to be more involved in line with SECA, ALMS, with NASCAR. And I think I bring that to Champ Car. I've got good relationships with every one of the sanctioning bodies because I haven't had to compete against them in the past. NHRA really was kind of out there on their own without much competition. SECA, we flew the Swiss flag, we got along with everybody, because we didn't have to compete with them really on the pro level. We added a lot of value when we would bring World Challenge to ALMS. We raced with Champ Car, we raced with IRL. I'm proud to be able to say all those guys are my friends. So I plan on working with them. Again, to help make Champ Car more mainstream and to bring the ultimate entertainment value to the motorsports and sporting enthusiast.

STEVE JOHNSON: You know, the answer is probably yes, but they're ones that we'll get over. I haven't had a chance to review the schedule enough to see are we running side by side with the Masters and with some other major sporting events. The schedule was announced prior to my coming in. Yeah, we'd love to have a more tight, compact schedule, but the schedule is what it is for '06. I had a meeting this morning to start talking already about the '07 schedule with Joe. We're going to do our best to make sure we put the best schedule out there and make sure that it works not only for us and for our teams but for the fans and for all our track partners, as well. There's a lot of complexities when you put a schedule on. There's a lot of people that you're serving when you are do that. I know they used their best efforts. I applaud them for getting the schedule out as early as they did, because that's always a challenge. I think you hit it. I think they were probably the first or second major series to have their schedule out. Boy, what a difference a year makes.

STEVE JOHNSON: Well, I wouldn't call it neglecting them. Again, the schedule is what it is. I can't talk about why we've got the international swing at the end of the season versus the first part of the season. I don't know why. We do have a lot of fans. We are viewed in 160 countries with our broadcasts. Although it is a late event in Las Vegas, I don't think that's the time we would ideally pick to be on. Again, it's something that we'll work towards improving in the future. As I said, we're already working on the '07 schedule and looking at different alternatives to possibly juggle some things around so we don't lose a two-month period or a one-month period of the US presence.

STEVE JOHNSON: That's a great question. They do have Trans-Am that you see that races with them. Including racing or owning? I don't think we're looking to own anybody. To race with, we raced with World Challenge at Cleveland and Denver this year. I think World Challenge add a lot of value. Trans-Am obviously has been out there adding value. From fendered cars, and then in Mexico City we're going to have Grand-Am. There's been talk about possible running of ALMS -- running with ALMS in the future. I guess the answer is yes, we are looking at, again, creating the best entertainment value for the weekend. It's not just about going out and running a race. There are many parts to that, so there is a fendered piece associated with us.

ERIK MAUK: Thank you very much. That will bring an end to our Champ Car media teleconference for the day. We appreciate everyone joining in talking to Mr. Johnson today.