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Re: Reorg, was: SEB-Update/Backdate in STS, STX

To: "Matt Murray" <mattm@optonline.net>, <autox@autox.team.net>,
Subject: Re: Reorg, was: SEB-Update/Backdate in STS, STX
From: "Steve Hoelscher" <stevehh@hiwaay.net>
Date: Sun, 13 Jul 2003 20:18:32 -0500
Matt Murray wrote:

> FWIW, running in my teen-weenie stock classes, I have been through minor
> reorgs (BS to AS, etc.), up to and including the major reorg of a few
years
> ago. Painful and a bit traumatic, but the stock competitors survived it.
> And to be honest, I'd say Stock is due for another reorg in two or three
> years. Imbalances have occurred and need to be addressed, instead of Stock
> staying stagnate.
>


Matt, stock class re-orgs are not that big a deal.  They happen all the time
as new cars are introduced and re-classed.  Anthing resembling a major
upheaval, as happed a few years ago, is not as earth moving as it would be
in SP.  It takes a couple of years to develope a competitive SP car in most
cases.  And in the majority of SP classes, buying the car is the cheap part,
its the cost of developement that makes it expensive.  In stock a major
re-org may cause the competitive drivers to switch cars, abandoning a now
un-competitive car and buy a newly competitive model.  But such things
happen on almost a seasonal schedule anyway.  Worst case you take the
depreciation hit, sell the car and whatever parts you bought and move on.

In SP things are quite different.   Buy a car and spend two years or more in
development, spend several thousand dollars for engine overhauls, fuel
injection systems, limited slips, coil overs, clutches and flywheels, seats,
dyno time, travel for testing, etc...  You now have an investment that far
surpasses the cost of buying and preparing a stock class car.   Now that you
finally have the car competitive, have the SEB re-org SP and render your
investment in time and money almost worthless because you can only sell the
car for a fraction of the investment in it.  The construction and
development expenses are all lost.  This is a MAJOR financial loss for an SP
competitor.   Above all else Street Prepared, Prepared and Modified classes
need stability to survive because the competitors must have several years to
amortize the cost of development.  Regular re-org of these classes will
drive competitors out due to the high cost of dealing with the re-orgs.

I know of what I speak because it has happened to me TWICE now.  First, I
built my first purpose built DSP car (a 1300 X1/9) back in '89.  I spent
every penny I had to build that car.  I went to my first Nationals that year
and finished third.    But in July of that same year the SEB moved a whole
slew of "uncompetitive CSP cars" down to DSP for '90.  When I returned to
Nationals in '90 I was lapped traffic.  The cars I had run against in '89
were gone and DSP was now a very different class.  I got one season out of
my new car.  I took a year off to save the money to re-invest in the car to
try and make it competitive but that effort failed.  After two years of
trying I gave up and built a new car (my current 1500 X1/9).   I very nearly
dropped out of the sport because of this.  I had invested every cent I had
to spare in that car which was rendered useless by the stroke of a pen.
That it could happen again if I built a new car had me very worried.
Obviously I built that new car.  I then spent four years developing it which
paid off with four championships.  I was rewarded for my efforts by a major
re-org of SP which created FSP, where most all of my former DSP competitors
sought refuge and another batch of "uncompetitive CSP cars" were dropped on
top of me.   Again, I am faced with trying to competely re-think the car to
try and find more performance or abandon it at a significant loss and build
yet another new car.  At least this time I got more than a single season out
of it.  Still, a $20,000+ loss is hard to take.

So don't talk to me about major re-orgs in stock.  You have no clue.  ;-)

Steve Hoelscher
#27 DSP

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