Bloomberg News

Ferrari 458 Lets CEO Hit Le Mans Like Steve McQueen

March 11, 2013

Gentleman Driver

For W&T Offshore CEO Tracy Krohn, a "gentleman driver," no race matters as much as the 24 Hours of Le Mans, which turns 90 this June. Photographer: Pari Dukovic/Bloomberg Pursuits

The Ferrari 458 takes the Mulsanne Straight at 180 miles per hour, a lime-green streak through the fastest section of the 24 Hours of Le Mans, which ranks alongside the Daytona 500, the Indianapolis 500 and the Monaco Grand Prix as one of auto racing’s pre-eminent jewels. About 240,000 fans ring the 8.5-mile track on this sunny day in mid-June.

Downshifting, amateur racer Tracy Krohn steers the Ferrari into the pit and pulls his 6-foot-3-inch frame from the car, his fire-retardant overalls drenched in sweat. A co-driver takes over, piloting the Ferrari back onto the track to protect Krohn Racing’s third-place position. “You feel like you’ve been in a war out there,” Krohn says later.

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Few men get the chance to be Steve McQueen for a day, Bloomberg Pursuits magazine will report in its Spring issue. Krohn -- the 58-year-old chief executive officer of Houston-based W&T Offshore Inc. (WTI), an oil and gas company that specializes in exploration and extraction in the Gulf of Mexico -- does it all the time. A decade after his first race, he competes in the amateur division of the Federation Internationale de l’Automobile World Endurance Championship (FIA WEC), an eight-event competition on circuits as far afield as Bahrain and China.

Endurance Race

A unique quality of endurance racing is that professional and amateur drivers compete on the same track at the same time, albeit in separate divisions. That means an amateur such as Krohn had better know what he’s doing, because he’ll inevitably mix it up with the world’s best drivers through tight corners at high speeds.

No race matters to Krohn as much as the 24 Hours of Le Mans, which will have its 90th running in France this June. The world’s oldest automobile endurance race tests speed and toughness over the course of an uninterrupted day, after which the team completing the most laps wins. All told, a team of three drives as many as 3,460 miles (5,570 kilometers), about the distance from Miami to Seattle, with each shift typically lasting two hours. Krohn lives to win here -- a feat that has so far eluded him, although he has stood on the podium three times, including last June, when his team finished third out of 13 amateurs and 25th out of 56 overall.

“It’s hard to have a competitive car and achieve what he’s done -- even for someone who does it every day, let alone for someone who has a day job,” says Robert Kauffman, co-founder of Fortress Investment Group LLC (FIG) and a fellow amateur driver, who retired in December, in part to devote more time to racing.

Gentleman Driver

For a “gentleman driver” like Krohn, who took up racing in his late 40s, winning Le Mans, which can make the career of even a pro driver, would seem an unrealistic fantasy. Yet, he has almost accomplished his goal, as was evident in June, when his team finished six laps, a mere 1.6 percent deficit, behind the amateur winner, Larbre Competition of France.

In July, Krohn is upstairs in his spacious Italianate manse in Houston’s exclusive River Oaks neighborhood. He’s driving on a video simulator that could pass for an arcade game. Niclas Jonsson, a veteran of IndyCar and Nascar, stands at his shoulder. The two have worked together since 2002, and Jonsson, 45, now competes alongside Krohn as a co-driver. Their selected course today is Sao Paulo’s Interlagos (where they will race in September and suffer a first-lap accident that will prevent them from finishing, by far their worst outing of the year).

“This is not an easy track,” Krohn says, his face tightening as he attempts to steer through a difficult corner.

High-Speed Hobby

There’s nothing playful about the way Krohn approaches his high-speed hobby. Make a mistake at 175 mph and you may not live to examine what went wrong. Rather than be dissuaded by danger, Krohn is drawn to the monastic focus required to manage it.

“When I get in the car, it’s my sanctuary,” he says. “I’m there because I want to be there. I don’t have to answer the phone or be in a meeting. It’s a luxury to have to do only one thing. It’s very therapeutic.”

It’s a kind of therapy that requires unorthodox preparation for situations that can be more extreme than in almost any other sport. To manage the jarring nature of driving at high speeds, Krohn engages in neck exercises while wearing a driving helmet outfitted with weights. He trains with exercise grips and rubber balls, strengthening his hands and wrists to handle the bumps of the road and avoid cramping. At a Houston track, he races high-powered go-karts that can reach 100 mph to keep his reflexes sharp and hone his passing skills.

Intense Training

Training intensifies two weeks before each race. Acclimating to the rigors of races that can run a day and a night, Krohn and Jonsson go to bed early and then wake at 3 a.m. to work out for two hours. They often train in fire-retardant racing suits to prep for the energy-sapping heat of the car, which can reach 160 degrees Fahrenheit (71 degrees Celsius). Krohn will even ride a stationary bike in a sauna.

Krohn believes that mastering such trial by fire has enhanced his ability to focus on the rigors of leading a workforce of 337 through the opportunities and pitfalls of business in the Gulf of Mexico.

“On every lap, there are a lot of things other drivers do to create situations that are unfavorable,” he says. “Business is the same way. You don’t want to get emotional and have it affect your performance. You go slower by getting emotional.”

Not that emotion can be completely excised from Krohn’s racing life. He and Jonsson make their way downstairs to the living room, and the talk turns to Le Mans.

“There are 100,000 people at practice,” Krohn says. “There’s so much history to it. And the track is just really, really fast. The sheer speeds are incredible.”

New Tires

In 2011, Krohn and Jonsson were leading Le Mans after 10 hours and 22 minutes when their engine blew -- a heartbreaking technical failure. Nonetheless, they remain determined. “We will win Le Mans,” Jonsson says flatly.

Different tires may be all it takes to secure a victory lap, they say. For this year’s Le Mans, they’ll drive on Michelin tires, which, in their opinion, provide stability and grip across a greater variance of temperatures than the Dunlop tires they have raced the past few years. That will give them the confidence to drive harder through the track’s many challenging turns, they say.

Krohn took his first driving course at a track in Atlanta in 1998. Any interest in golf, racquetball, skiing and surfing -- all sports at which he’s proficient -- waned that same day. From then on, it was only racing.

Road Atlanta

Within a few years, he had established his own team, with headquarters at the Road Atlanta track, in Braselton, Georgia, which has a more vibrant racing environment than Houston’s. He now has 10 full-time employees there, including David Brown, Krohn Racing’s manager and technical director, who served as race engineer for the late Formula One legend Ayrton Senna. The team engages in testing and adjusting Krohn’s Ferrari, stripping it down after every race and rebuilding it, a time-consuming process of data analysis and minute adjustments.

After racing a Ferrari 430 in 2011, Krohn upgraded to the new 458 for the 2012 season. Among its host of improvements, the 500-horsepower car incorporates better handling, braking and responsiveness. It has a wider body, with more-efficient aerodynamics, a more-sophisticated traction control and a midengine mount that centers the car’s weight. Like previous Krohn cars, this one is lime green, the better to be seen on the track, for both safety and publicity.

Expensive Passion

Such investments in personnel and equipment are costly, and Krohn -- whose net worth was about $900 million as of Jan. 1 from his 53.5 percent stake in W&T, stock sales and dividends, according to data compiled by Bloomberg -- won’t say how much he spends on racing. Scott Atherton, CEO of American Le Mans Series LLC, estimates it costs from $2.5 million to $10 million to fund an endurance racing team for one season, depending on the team’s commitment to winning. The cost of a race-ready Ferrari 458 alone is about $850,000, depending on specifications. Clearly, Krohn’s view from the podium hasn’t come cheap.

Few other deep-pocketed businessmen compete at this elite level of racing. Vicente Potolicchio, a Venezuelan oil and gas baron, participates in the same series as Krohn. Christian Zugel, founder of ZAIS Group LLC; Scott Tucker, a former private-equity CEO; and Kauffman have also competed in at least one race. In total, maybe 20 gentleman drivers will compete in an FIA WEC event each year.

Even a competitor such as Kauffman recognizes Krohn’s commitment. “He’s not a dilettante,” Kauffman says. “He works at it, and he gets a lot of respect for that.”

Physical Risks

Because Krohn spends so much time racing, he says he has heard people question why he hasn’t stopped in order to spend more time at his company. “But I’ve never heard it from shareholders,” he says.

A shareholder may more validly question the physical risks to W&T’s CEO. One afternoon at W&T headquarters in Houston, Krohn points to a picture hanging on his office wall of a boat loaded with Gulf roughnecks straining up the face of a giant swell.

“People ask me all the time, ‘Isn’t racing dangerous?’” Krohn says. “Hell, no.” He jabs a finger at the photo again. “This is dangerous.”

For a man who has escaped a platform rig in a storm, as Krohn has, and driven hairpin turns at breakneck speed, danger is likely a relative concept. This is especially clear later that day in Krohn’s Ferrari 430, as he takes Houston’s Allen Parkway, bound for the glittering skyscrapers of downtown. Like the slalom skier he once was, he weaves through the daytime traffic, his eyes fixed in concentration. After clocking speeds well above the posted limit, he abruptly exits toward a local road with the aplomb of an elite driver.

“I figure I can start playing golf again when I’m 80,” he says.

Unless, of course, he hasn’t won Le Mans by then.

To contact the editor responsible for this story: Ted Moncreiff at tmoncreiff@bloomberg.net


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