Could Nissan Wash-Out Affect Future PGA Sponsorship Contracts?

Last week's Nissan Open proved to be a disaster, with rain throughout the weekend causing the tournament to be shortened to 36-holes. This means that the winner of the tournament, Adam Scott, does not get an official tournament win and the perks that come with it. But he, and the rest of the players, did receive the full allotment of prize money -- $4.8 million in total -- and Nissan is asking why it had to pay the full amount of prize money for a tournament that was only half-played.

The answer lies in Nissan's contract with the tournament's organizers and the PGA. The contract states that if the event makes it through at least 18-holes, then the sponsor must pay the full amount of prize money. Some sponsors carry insurance in case of shortened events, but Nissan is asking why this is even necessary. John Gill, director of sports marketing for Nissan North America, is hoping to write a clause into the company's next title sponsor contract that would have some form of a pro-rated compensation clause.

For a number of reasons, the PGA is likely to balk at such an arrangement. For one, it could make players less likely to come to tournaments that often have inclement weather. The Nissan Open, held in Los Angeles, rarely has any weather issues, but other tournaments are not so lucky. Players might choose to skip tournaments with a history of poor weather rather than risk a lower pay-out. In addition, the PGA may feel that it has the better bargaining position in seeking title sponsors. While Nissan has been a loyal sponsor of golf, the PGA may feel that it can find a number of other sponsors willing to jump in and take Nissan's place in Los Angeles. Whether this is accurate remains to be seen, but the PGA is not likely to agree to reduced pay-outs without a significant fight.

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