<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549



                                    FORM 10-Q


(Mark One)

(X)      Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 for the quarterly period ended September 30, 2002.

( )      Transition report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 for the transition period ______ to ______.

                           Commission File No. 1-13925

                      CHAMPIONSHIP AUTO RACING TEAMS, INC.
                      ------------------------------------
             (Exact name of registrant as specified in its charter)

          Delaware                                     38-3389456
          --------                                     ----------
(State or other jurisdiction of             (IRS Employer Identification No.)
Incorporation or organization)

            5350 Lakeview Parkway Drive South, Indianapolis, IN 46268
            ---------------------------------------------------------
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (317) 715-4100
                                 --------------
              (Registrant's telephone number, including area code)

           755 West Big Beaver Road, Suite 800, Troy, Michigan 48084
--------------------------------------------------------------------------------
  (Former name, address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X]  No [ ]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

    COMMON STOCK $0.01 PAR VALUE                14,718,134 SHARES
    ----------------------------                -----------------
      (class of common stock)           (outstanding at November 1, 2002)



                         This report contains 33 pages.




                                       1
<PAGE>



                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
PART I  - FINANCIAL INFORMATION                                                                              PAGE

<S>                                                                                                           <C>

         ITEM 1.     CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

                         Consolidated Balance Sheets as of September 30, 2002 and
                         December 31, 2001                                                                     3

                         Consolidated Statements of Operations for the Three and Nine Months
                         Ended September 30, 2002 and 2001                                                     4

                         Consolidated Statement of Stockholders' Equity for the Nine Months
                         Ended September 30, 2002                                                              5

                         Consolidated Statements of Cash Flows for the Nine Months Ended
                         September 30, 2002 and 2001                                                           6

                         Notes to Consolidated Financial Statements                                            7


         ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                     FINANCIAL CONDITION AND RESULTS OF OPERATIONS                                            12


         ITEM 3.     QUANTITATIVE AND QUALITATIVE DISCLOSURES                                                 22
                     ABOUT MARKET RISKS


PART II - OTHER INFORMATION

         ITEM 1.     LEGAL PROCEEDINGS                                                                        23

         ITEM 4.     CONTROLS AND PROCEDURES                                                                  23

         ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K                                                         23

         SIGNATURES                                                                                           24

         CERTIFICATIONS                                                                                       25

         EXHIBITS                                                                                             27


</TABLE>



                                       2
<PAGE>
                      CHAMPIONSHIP AUTO RACING TEAMS, INC.
                           CONSOLIDATED BALANCE SHEETS
                 AS OF SEPTEMBER 30, 2002 AND DECEMBER 31, 2001
                             (DOLLARS IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                         SEPTEMBER 30, 2002  DECEMBER 31, 2001
                                                                                         ------------------  -----------------
<S>                                                                                            <C>               <C>
ASSETS
CURRENT ASSETS:
   Cash and cash equivalents                                                                   $ 15,174          $ 27,765
   Short-term investments                                                                        87,776            87,621
   Accounts receivable (net of allowance for doubtful accounts
      of $1,524 and $7,338 at September 30, 2002 and December 31, 2001, respectively)             9,192             5,195
   Current portion of notes receivable (net of allowance for doubtful notes
      of $124 and $123, at September 30, 2002 and December 31, 2001, respectively)                   --                --
   Inventory                                                                                         95                70
   Prepaid expenses                                                                               1,473             2,805
   Deferred income taxes                                                                         10,359             2,856
                                                                                               --------          --------
      Total current assets                                                                      124,069           126,312
NOTES RECEIVABLE (net of allowance for doubtful notes of $96 and $96, at
      September 30, 2002 and December 31, 2001, respectively)                                        --                --
PROPERTY AND EQUIPMENT- Net                                                                       5,716             4,832
NON-CURRENT DEFFERED INCOME TAXES                                                                   457                --
GOODWILL                                                                                             --             1,470
OTHER ASSETS                                                                                        356               327
                                                                                               --------          --------
TOTAL ASSETS                                                                                   $130,598          $132,941
                                                                                               ========          ========

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
   Accounts payable                                                                            $  5,034          $  3,009
   Accrued liabilities:
      Race expenses and point awards                                                              2,171                --
      Television expenses                                                                         2,514                --
      Royalties                                                                                     119               222
      Payroll                                                                                     2,728             4,298
      Taxes                                                                                         929               110
      Other                                                                                       4,617             5,558
   Deferred revenue                                                                               8,141             1,511
                                                                                               --------          --------
      Total current liabilities                                                                  26,253            14,708

DEFERRED INCOME TAXES                                                                                --               297
STOCKHOLDERS' EQUITY:
   Preferred stock, $.01 par value; 5,000,000 shares
      authorized, none issued and outstanding at September 30, 2002
      and December 31, 2001                                                                          --                --
   Common stock $.01 par value, 50,000,000 shares authorized, 14,718,134
      and 14,718,134 shares issued and outstanding at September 30, 2002
      and December 31, 2001, respectively                                                           147               147
   Additional paid-in capital                                                                    87,765            87,765
   Retained earnings                                                                             15,498            29,028
   Accumulated other comprehensive income                                                           935               996
                                                                                               --------          --------
         Total stockholders' equity                                                             104,345           117,936
                                                                                               --------          --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                     $130,598          $132,941
                                                                                               ========          ========
</TABLE>

See accompanying notes to consolidated financial statements.


                                       3
<PAGE>


                      CHAMPIONSHIP AUTO RACING TEAMS, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
         FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
                                   (UNAUDITED)
                    (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)

<TABLE>
<CAPTION>
                                                                                   THREE MONTHS                  NINE MONTHS
                                                                                ENDED SEPTEMBER 30,           ENDED SEPTEMBER 30,
                                                                                2002           2001           2002           2001
                                                                              --------       --------       --------       --------
<S>                                                                           <C>            <C>            <C>            <C>
REVENUES:
    Sanction fees                                                             $ 12,555       $ 21,744       $ 27,082       $ 37,633
    Sponsorship revenue                                                          2,934          3,703          8,039         10,110
    Television revenue                                                           1,967          2,365          4,230          4,204
    Race promotion revenue                                                          --             --          1,417             --
    Engine leases, rebuilds and wheel sales                                         --            325             --            908
    Other revenue                                                                1,081          1,422          2,665          2,928
                                                                              --------       --------       --------       --------
         Total revenues                                                         18,537         29,559         43,433         55,783

EXPENSES:
    Race distributions                                                           8,427          8,399         15,778         13,760
    Race expenses                                                                4,110          3,227          8,432          7,799
    Race promotion expense                                                       5,452             --          8,935             --
    Cost of engine rebuilds and wheel sales                                         --            128             --            343
    Television expense                                                           4,892             --          9,604             --
    Administrative and indirect expenses (includes severance
       expense of $0 and $0 for the three and nine months ended
       September 30, 2002, respectively, and $257 and $1,453 for
       the three and nine months ended September 30, 2001, respectively)         8,966          9,803         20,762         22,766
    Litigation expense                                                              --          3,547             --          3,547
    Relocation expense                                                              --             --          1,305             --
    Asset impairment and strategic charges                                          --          8,548             --          8,548
    Depreciation and amortization                                                  357            346          1,045          1,151
                                                                              --------       --------       --------       --------
         Total expenses                                                         32,204         33,998         65,861         57,914

OPERATING INCOME (LOSS)                                                        (13,667)        (4,439)       (22,428)        (2,131)
    Realized gain on sale of investments                                             2             --              2             --
    Interest income (net)                                                          882          1,761          3,083          5,700
                                                                              --------       --------       --------       --------
INCOME (LOSS) BEFORE INCOME TAXES                                              (12,783)        (2,678)       (19,343)         3,569
    Income tax expense (benefit)                                                (4,473)          (968)        (6,769)         1,249
                                                                              --------       --------       --------       --------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE                   $ (8,310)      $ (1,710)      $(12,574)      $  2,320
CUMULATIVE EFFECT OF ACCOUNTING CHANGE (NET OF TAX)                           $     --       $     --       $   (956)      $     --
                                                                              --------       --------       --------       --------
NET INCOME (LOSS)                                                             $ (8,310)      $ (1,710)      $(13,530)      $  2,320
                                                                              ========       ========       ========       ========
EARNINGS (LOSS) PER SHARE BEFORE CUMULATIVE EFFECT OF
ACCOUNTING CHANGE:
             BASIC                                                            $  (0.56)      $  (0.11)      $  (0.85)      $   0.15
                                                                              ========       ========       ========       ========
             DILUTED                                                          $  (0.56)      $  (0.11)      $  (0.85)          0.15
                                                                              ========       ========       ========       ========
NET EARNINGS (LOSS) PER SHARE:

              BASIC                                                           $  (0.56)      $  (0.11)      $  (0.92)      $   0.15
                                                                              ========       ========       ========       ========
              DILUTED                                                         $  (0.56)      $  (0.11)      $  (0.92)      $   0.15
                                                                              ========       ========       ========       ========
WEIGHTED AVERAGE SHARES OUTSTANDING:
              BASIC                                                             14,718         15,141         14,718         15,482
                                                                              ========       ========       ========       ========
              DILUTED                                                           14,718         15,149         14,718         15,485
                                                                              ========       ========       ========       ========
</TABLE>

See accompanying notes to consolidated financial statements


                                       4
<PAGE>



                      CHAMPIONSHIP AUTO RACING TEAMS, INC.
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                  FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002
                                   (UNAUDITED)
                                 (IN THOUSANDS)



<TABLE>
<CAPTION>
                                               COMMON STOCK       ADDITIONAL           ACCUMULATED OTHER
                                           -------------------     PAID-IN     RETAINED  COMPREHENSIVE  STOCKHOLDERS' COMPREHENSIVE
                                           SHARES       AMOUNT     CAPITAL     EARNINGS  INCOME (LOSS)     EQUITY           LOSS
                                           ------       ------     -------     --------  -------------     ------           ----

<S>                                         <C>        <C>         <C>         <C>           <C>          <C>           <C>
BALANCES, DECEMBER 31, 2001                 14,718       $147      $87,765      $29,028      $996         $117,936
   Net loss                                     --         --           --      (13,530)       --          (13,530)     $ (13,530)
   Accumulated other comprehensive income       --         --           --          --        (61)             (61)           (61)
                                                                                                                       ------------
   Comprehensive loss                                                                                                     $(13,591)
                                                                                                                       ============
                                          ---------    -------   ----------    --------     ------       ----------
BALANCES, SEPTEMBER 30, 2002                14,718        $147      $87,765     $15,498       $935         $104,345
                                          =========    =======   ==========    ========     ======       ==========
</TABLE>

See accompanying notes to consolidated financial statements.



















                                       5
<PAGE>

                      CHAMPIONSHIP AUTO RACING TEAMS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
                                   (UNAUDITED)
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                               2002            2001
                                                                            ---------       ---------
<S>                                                                         <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net income (loss)                                                      $ (13,530)      $   2,320
     Adjustments to reconcile net income (loss) to
            net cash provided by (used in) operating activities:
     Cumulative effect of accounting change (net of tax)                          956              --
     Depreciation and amortization                                              1,045           1,151
     Impairment of goodwill                                                        --           5,628
     Net loss from sale of property and equipment                                  17           1,973
     Deferred income taxes                                                     (7,743)         (4,049)
     Changes in assets and liabilities that provided (used) cash:
           Accounts receivable                                                 (3,997)            249
           Inventory                                                              (25)             15
           Prepaid expenses                                                     1,332            (145)
           Other assets                                                           (29)             (2)
           Accounts payable                                                     2,025             902
           Accrued liabilities                                                  2,890          15,398
           Deferred revenue                                                     6,630           7,464
           Deposits                                                                --            (778)
                                                                            ---------       ---------
                   Net cash provided by (used in) operating activities        (10,429)         30,126

CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchase of investments                                                 (120,252)        (56,553)
     Proceeds from sale of investments                                        120,036          60,410
     Notes receivable                                                              --           2,463
     Acquisition of property and equipment                                     (1,971)           (616)
     Proceeds from sale of property and equipment                                  25              86
     Acquisition of trademark                                                      --              (1)
                                                                            ---------       ---------
                Net cash provided by (used in) investing activities            (2,162)          5,789

CASH FLOWS FROM FINANCING ACTIVITIES:
      Issuance of common stock                                                     --             109
      Repurchase of common stock                                                   --         (15,485)
                                                                            ---------       ---------
                Net cash used in financing activities                              --         (15,376)
                                                                            ---------       ---------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                          (12,591)         20,539
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                               27,765          19,504
                                                                            ---------       ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                                  $  15,174       $  40,043
                                                                            =========       =========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
     Cash paid during the period for:
          Income taxes                                                      $       1       $     287
                                                                            =========       =========
          Interest                                                          $      --       $       6
                                                                            =========       =========
</TABLE>

See accompanying notes to consolidated financial statements.






                                       6
<PAGE>





                      CHAMPIONSHIP AUTO RACING TEAMS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         BASIS OF PRESENTATION. The accompanying unaudited consolidated
financial statements have been prepared by management and, in the opinion of
management, contain all adjustments, consisting of normal recurring adjustments,
necessary to present fairly the financial position of Championship Auto Racing
Teams, Inc. and subsidiaries (the "Company") as of September 30, 2002 and the
results of its operations and its cash flows for the three months and nine
months ended September 30, 2002 and 2001.

         The unaudited consolidated financial statements should be read in
conjunction with the consolidated financial statements included in the Company's
Form 10-K filed with the Securities and Exchange Commission.

         Because of the seasonal concentration of racing events, the results of
operations for the three months and nine months ended September 30, 2002 and
2001 are not indicative of the results to be expected for the year.

         PRINCIPLES OF CONSOLIDATION. The consolidated financial statements of
the Company include the financial statements of Championship Auto Racing Teams,
Inc. and its wholly-owned subsidiaries - CART, Inc., American Racing Series,
Inc., Pro-Motion Agency, Ltd. and CART Licensed Products, Inc. At the end of the
2001 season, the Company discontinued the operations of American Racing Series,
Inc. All significant intercompany balances have been eliminated in
consolidation.

          BASIC AND DILUTED EARNINGS (LOSS) PER SHARE. Diluted per share amounts
assume the exercise of shares contingently issuable under certain stock option
plans when dilutive. Shares (in thousands) excluded from the dilutive per share
calculations relating to these securities were approximately 1,079 and 771 for
the three month periods ended September 30, 2002 and 2001, respectively, and
1,079 and 691 for the nine month periods ended September 30, 2002 and 2001,
respectively.

            ACCOUNTING PRONOUNCEMENTS. In August 2001, the Financial Accounting
Standards Board ("FASB") issued Statement of Financial Accounting Standards
("SFAS") No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets." This Statement supersedes SFAS No. 121, "Accounting for the Impairment
of Long-Lived Assets to be Disposed Of." This statement retains the impairment
loss recognition and measurement requirements of SFAS No. 121. In addition, it
requires that one accounting model be used for long-lived assets to be disposed
of by sale, and broadens the presentation of discontinued operations to include
more disposal transactions. The Company adopted this statement on January 1,
2002, and there was no impact on the financial statements upon adoption.

         In June 2001, the FASB issued SFAS No. 141, "Accounting for Business
Combinations." The statement changes the accounting for business combinations
by, among other things, prohibiting the prospective use of pooling-of-interests
accounting. The Company adopted this statement on January 1, 2002 and there was
no impact on the financial statements upon adoption.

         On April 30, 2002, the FASB issued SFAS No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." The statement is intended to update, clarify and simplify existing
accounting pronouncements. Management does not believe this statement will have
a material effect on its consolidated financial statements.

         On July 30, 2002, the FASB issued SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities". The statement addresses financial
accounting and reporting for costs associated with exit or disposal activities
and nullifies Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability
Recognition for Certain Employee Termination Benefits and Other Costs to Exit an
Activity (including Certain Costs Incurred in a Restructuring)." SFAS 146 is
effective for exit or disposal activities that are initiated after December 31,
2002. Management does not believe this statement will have a material effect on
its consolidated financial statements.


                                       7
<PAGE>

         RECLASSIFICATIONS. Certain reclassifications have been made to the 2001
unaudited consolidated financial statements in order for them to conform to the
2002 presentation.

         USE OF ESTIMATES. The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.

2.  GOODWILL AND INTANGIBLE ASSETS

         In June 2001, the FASB issued SFAS No. 142, "Goodwill and Intangible
Assets." The statement requires companies to stop amortizing goodwill and
certain intangible assets with indefinite useful lives. Instead, goodwill and
intangible assets with indefinite useful lives will be tested for impairment
upon adoption of the statement and annually thereafter. The Company will perform
its annual impairment review for intangible assets during the fourth quarter of
each year, commencing with the fourth quarter of 2002. As a result of adoption,
the Company no longer records amortization expense related to goodwill or
intangible assets with indefinite useful lives.

         The Company adopted SFAS No. 142, effective January 1, 2002, which
resulted in a one-time, non-cash charge of $1.5 million, or $956,000 net of tax
benefit of $514,000, to write-off the value of its goodwill. The goodwill was
recorded under the purchase method of accounting for the purchases of Pro-Motion
Agency, Inc. and CART Licensed Products, LP, on April 10, 1998 and January 1,
1999, respectively. Such charge is non-recurring in nature and is reflected as a
cumulative effect of an accounting change in the accompanying consolidated
statements of operations. Previous to the adoption of SFAS No. 142, the Company
had accounted for its goodwill and intangible assets in accordance with the
accounting standards existing at the time, and the Company's analyses did not
result in recognition of any impairment loss prior to the adoption of SFAS No.
142.

         Under SFAS No. 142, goodwill impairment is deemed to exist if the
carrying value of a reporting unit exceeds its estimated fair value. The
Company's reporting units are generally consistent with the operating segments
underlying the segments identified in Note 5 - Segment Reporting. In calculating
the impairment charge, the fair values of the reporting units were estimated
using a discounted cash flow methodology.

         A reconciliation of net income (loss) and earnings per share, adjusted
to exclude amortization expense, net of tax, for the period prior to adoption
and the cumulative effect of accounting change recognized in the current period,
is as follows:

<TABLE>
<CAPTION>
                                                                      Three Months Ended                  Nine Months Ended
                                                               September 30,     September 30,     September 30,      September 30,
                                                                   2002              2001              2002                 2001
                                                                ----------        ----------        ----------         ----------
<S>                                                             <C>               <C>               <C>                <C>
Net income (loss)                                               $   (8,310)       $   (1,710)       $  (13,530)        $    2,320

Add back: Goodwill amortization, net of tax                              -                 7                 -                 20

Add back: Trademark amortization, net of tax                             -                 4                 -                 13

Cumulative effect of accounting change, net of tax                       -                 -               956                  -
                                                                ----------        ----------        ----------         ----------
Adjusted net income                                             $   (8,310)       $   (1,699)       $  (12,574)        $    2,353
                                                                ----------        ----------        ----------         ----------

Basic:
      Net income (loss) per share                               $    (0.56)       $    (0.11)       $    (0.92)        $     0.15

      Amortization net of tax                                            -                 -                 -                  -

      Cumulative effect of accounting change, net of tax                 -                 -              0.07                  -
                                                                ----------        ----------        ----------         ----------
      Adjusted income (loss) per share                          $    (0.56)       $    (0.11)       $    (0.85)        $     0.15
                                                                ----------        ----------        ----------         ----------

Diluted:
      Net income (loss) per share                               $    (0.56)       $    (0.11)       $    (0.92)        $     0.15

      Amortization net of tax                                            -                 -                 -                  -

      Cumulative effect of accounting change, net of tax                 -                 -              0.07                  -
                                                                ----------        ----------        ----------         ----------
      Adjusted income (loss) per share                          $    (0.56)       $    (0.11)       $    (0.85)        $     0.15
                                                                ----------        ----------        ----------         ----------
</TABLE>


                                       8
<PAGE>

3. SHORT-TERM INVESTMENTS

         The following is a summary of the estimated fair value of
available-for-sale short-term investments by balance sheet classification:

<TABLE>
<CAPTION>
                                                                    GROSS UNREALIZED
                                                                  ---------------------
(IN THOUSANDS)                        COST       FAIR VALUE         GAIN          LOSS
                                    -------      ----------       -------        ------
<S>                                 <C>            <C>             <C>            <C>
SEPTEMBER 30, 2002
------------------
Letters of credit                   $ 4,692        $ 4,692         $   --         $  --
Corporate bonds                       6,086          6,094              8            --
U.S. agencies securities             76,063         76,990            927            --
                                    -------        -------        -------        ------
Total short-term investments        $86,841        $87,776        $   935           $--
                                    =======        =======        =======        ======

DECEMBER 31, 2001
-----------------
Letters of credit                   $ 8,167        $ 8,167          $  --        $   --
Corporate bonds                         507            511              4            --
U.S. agencies securities             77,951         78,943            992            --
                                    -------        -------        -------        ------
Total short-term investments        $86,625        $87,621        $   996          $ --
                                    =======        =======        =======        ======
</TABLE>

         Proceeds from sales of investments for the nine months ended September
30, 2002 were approximately $120.0 million. Proceeds from sales of investments
were approximately $60.4 million for the nine months ended September 30, 2001.

         Contractual maturities range from less than one year to two years. The
weighted average maturity of the portfolio does not exceed one year.

4.  PROPERTY AND EQUIPMENT

         Property and equipment consists of the following at September 30, 2002
and December 31, 2001:


<TABLE>
<CAPTION>
                                                       (IN THOUSANDS)
                                              SEPTEMBER 30,       DECEMBER 31,                  USEFUL LIFE
                                                  2002                2001                       (IN YEARS)
                                            ----------------    ---------------     --------------------------------
<S>                                                <C>                <C>           <C>
         Engines                                   $    --            $ 2,456       Disposed
         Equipment                                   6,262              4,890       5-20
         Furniture and fixtures                        412                413       10
         Vehicles                                    4,065              3,553       5-7
         Other                                         183                215       5 (except leasehold improvements)
                                            ----------------    ---------------

         Total                                      10,922             11,527

         Less accumulated depreciation              (5,206)            (6,695)
                                            ----------------    ---------------

         Property and equipment (net)              $ 5,716            $ 4,832
                                            ================    ===============
</TABLE>

5.  SEGMENT REPORTING

         The Company has one reportable segment, racing operations.

         This reportable segment encompasses all the business operations of
organizing, marketing and staging all of our open-wheel racing events.

         The accounting policies of the segments are the same as those described
in the summary of significant accounting policies. The Company's long-lived
assets are substantially used in the racing operations segment in the United
States. The Company evaluates performance based on income before income taxes.


                                       9
<PAGE>

<TABLE>
<CAPTION>
                                                                THREE MONTHS ENDED SEPTEMBER 30,
                                                                --------------------------------
($ in thousands)                                  RACING OPERATIONS         OTHER*                 TOTAL
----------------                                  -----------------         ------                 -----

<S>                                                    <C>                   <C>           <C>
2002
Revenues                                               $ 18,495              $ 42               $ 18,537
Interest income (net)                                       879                 3                    882
Depreciation and amortization                               338                19                    357
Segment loss before income taxes                        (12,771)              (12)               (12,783)


2001
Revenues                                               $ 29,468              $ 91               $ 29,559
Interest income (net)                                     1,756                 5                  1,761
Depreciation and amortization                               322                24                    346
Segment income before income taxes                       (2,616)              (62)                (2,678)

<CAPTION>

                                                               NINE MONTHS ENDED SEPTEMBER 30,
                                                               -------------------------------
($ in thousands)                                 RACING OPERATIONS           OTHER*                 TOTAL
----------------                                 -----------------           ------                 -----

<S>                                                    <C>                  <C>                <C>
2002
Revenues                                               $ 43,311             $ 122                $ 43,433
Interest income (net)                                     3,073                10                   3,083
Depreciation and amortization                               989                56                   1,045
Segment loss before income taxes                        (19,307)              (36)                (19,343)

2001
Revenues                                               $ 55,511             $ 272                $ 55,783
Interest income (net)                                     5,685                15                   5,700
Depreciation and amortization                             1,078                73                   1,151
Segment income before income taxes                        3,587               (18)                  3,569

</TABLE>

*Segment is below the quantitative thresholds for determining reportable
segments and commenced operations on January 1, 1997. This segment is related to
the Company's licensing royalties.

Reconciliations to consolidated financial statement totals are as follows:


<TABLE>
<CAPTION>
              ($ in thousands)                          SEPTEMBER 30,         DECEMBER 31,
              ----------------                               2002               2001
                                                         -------------       ------------
<S>                                                         <C>               <C>
             Total assets for reportable segment            $ 133,774         $  131,901
             Other assets                                         280              1,040
                                                         -------------       ------------

             Total consolidated assets                      $ 134,054         $  132,941
                                                         =============       ============
</TABLE>


         As a result of the Company's adoption of SFAS No. 142, the Racing
Operations segment recorded a non-cash charge of $632,000, or $411,000 net of
tax benefit of $221,000, and the Other segment recorded a non-cash charge of
$838,000, or $545,000 net of tax benefit of $293,000, as a cumulative effect of
accounting change for the write-off of goodwill effective in the first quarter
of 2002.


6.  COMMITMENTS AND CONTINGENCIES

         LITIGATION. On September 8, 2000, a complaint for damages was filed
against the Company in the Superior Court of the State of California, County of
Monterey. This lawsuit was filed by the heirs of Gonzolo Rodriguez, a race car
driver who died on September 11, 1999 while driving his race car at the Laguna
Seca Raceway in a practice session for the CART race event. The suit seeks
damages in an unspecified amount for negligence and wrongful death. On November
5, 2001, a release signed by Mr. Rodriguez was upheld by the Court and the
causes of action for negligence were dismissed based on the defendants' motion
for summary judgment. The remaining count in the lawsuit is for willful and/or
reckless conduct and the case is currently in the discovery phase. The Company
intends to vigorously defend itself in this lawsuit and does not believe that it
is liable for the incident. The Company requires


                                       10
<PAGE>

each promoter to indemnify us against any liability for personal injuries
sustained at such promoter's racing event. In addition, the Company requires
each promoter to carry liability insurance, naming us as a named insured. The
Company also maintains liability insurance to cover racing incidents. Management
does not believe that the outcome of this lawsuit will have a material adverse
affect on our financial position or future results of operations.

         On October 30, 2000, a complaint for damages was filed against the
Company in the Superior Court of the State of California, County of San
Bernardino. This lawsuit was filed by the estate of Greg Moore, a race car
driver who died on October 31, 1999 while driving his race car at the California
Speedway during the CART race event. The suit sought actual and punitive damages
from the Company in an unspecified amount for breach of duty, wanton and
reckless misconduct, breach of implied contract, battery, wrongful death and
negligent infliction of emotional distress. On a motion for Summary Judgment,
the complaint was dismissed on all counts on October 16, 2002.

         On November 8, 2001, two former team owners, DellaPenna Motorsports and
Precision Preparation, Inc., filed suit against the Company in the Circuit Court
for the County of Wayne, State of Michigan, each alleging damages in excess of
$1.0 million for breach of contract, promissory estoppel, misrepresentation, and
tortious interference with contract and business expectancy. The Company intends
to vigorously defend itself in this lawsuit and does not believe the lawsuit has
merit. The suit is currently in the discovery phase. Management does not believe
that the outcome of this lawsuit will have a material adverse affect on the
Company's financial position or future results of operations.

         On March 26, 2002, the Company filed a complaint against Joseph F.
Heitzler, a former director and former chairman, chief executive officer and
president of the Company in U.S. District Court, Eastern District of Michigan,
Southern Division. The complaint alleges that Mr. Heitzler breached his
employment contract, breached his fiduciary duties and intentionally or
recklessly omitted to disclose information to the Company in order to induce the
continuation of Mr. Heitzler's employment agreement. The suit seeks damages of
an unspecified amount. This lawsuit has been removed to California. On March 28,
2002, Mr. Heitzler filed a complaint against the Company in the Superior Court
of the State of California, County of Los Angeles. The suit seeks compensatory,
exemplary and punitive damages in excess of $2.0 million for breach of contract,
fraud, negligent misrepresentation, breach of covenant of good faith and fair
dealing and declaratory relief. An amended complaint adding a count for tortious
breach of contract in violation of public policy was filed on April 9, 2002. The
Company intends to vigorously defend itself in this lawsuit. Management does not
believe that the outcome of these lawsuits will have a material adverse affect
on the Company's financial position or future results of operations.

         On July 9, 2002 a Demand for Arbitration was filed against the Company
with the American Arbitration Association in Indianapolis, Indiana by Engine
Developments Ltd. The Demand alleges that the Company breached an agreement to
purchase engines and seeks unspecified damages. The claim is currently in the
discovery stage. Management does not believe that an agreement was ever entered
into and intends to vigorously defend itself. Management does not believe that
the outcome of this Demand for Arbitration will have a material adverse affect
on the Company's financial position or future results of operations.

         The Company is involved in other litigation not specifically identified
above and does not believe the outcome of any of this litigation will have a
material adverse affect on its financial position or future results of
operation.



                                       11
<PAGE>


ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
        CONDITION AND RESULTS OF OPERATIONS



OVERVIEW

         Beginning in 2002, we are transitioning our company from a sanctioning
body to a marketing services company. Historically, we have derived our revenues
from three primary sources: sanction fees paid by track promoters, corporate
sponsorship fees and television revenues. Starting this year, we are introducing
new revenue sources to our business model.

         At certain tracks, we are promoting our own events, and at others, we
are partnering with experienced promoters. We are using the talent and
experience of our key personnel to set the standard for promotion of CART
sanctioned events, and we will participate in the potential net income from such
successful events rather than receiving fixed sanction fees as we have done in
the past. For the events where we are sharing revenues, we will receive lower
up-front sanction fees, but our agreements provide for us to receive a majority
of any profits until the original sanction fee is received, with profit sharing
thereafter. We are also taking on the risk of potential losses with these
revenue sharing events.

         We have also entered into new television agreements for 2002 with Speed
Channel, Fox and CBS. These arrangements significantly increase the number of
high quality CART programming hours that are available to our fans domestically.
We had seven races broadcast on CBS and one race on FOX, with the balance airing
on Speed Channel. We are buying the air-time and paying for production for the
CBS and FOX races and receive the advertising time which we, along with our
agents, are responsible for selling. This new domestic television arrangement is
different than our past television arrangement where we received a rights fee.

         The significant changes to our business model affect the comparability
of our financial results.

         The following discussion and analysis of the financial condition and
results of operations should be read in conjunction with the unaudited
consolidated financial statements of the Company, including the respective notes
thereto which are included in this Form 10-Q.

CRITICAL ACCOUNTING POLICIES

Revenue Recognition

         One of our most critical accounting policies is revenue recognition. We
recognize our revenues as they are earned, but the determination of when they
are earned depends on the source of the revenue. Our assumptions for each
revenue source are outlined below.

         SANCTION FEE REVENUE. Generally, sanction fees are paid in advance of
the race and are recorded as deferred revenue. Revenue from sanction fees is not
recognized until the event is completed. Beginning in 2002, we have entered into
agreements with certain promoters where all or a portion of the contracted
sanction fee has been reduced in exchange for a percentage of the profits from
the event. The sanction fee received and our share of any profits from these
events will be recognized as sanction fee revenue when the event is completed.

         SPONSORSHIP REVENUE. Generally, sponsorship agreements call for
quarterly payments, and each payment is recorded as deferred revenue when paid.
Revenue is recorded ratably over the life of the sponsorship agreement.

         ENGINE LEASE, REBUILDS AND WHEEL SALES. Engine lease revenue, relating
to our discontinued Indy Lights series, was recognized ratably over the period
covered by the agreement. Engine rebuilds and wheel sales were recognized when
the product was delivered to the customer. This revenue ceased at the end of the
2001 Indy Lights season.


                                       12
<PAGE>

         TELEVISION REVENUE. Beginning in 2002, we sell the advertising for the
eight shows that were aired on the CBS and Fox networks. Advertising revenue
will be recognized, based on ads sold, for these events when the event is
completed and the advertising is aired. In addition, we receive international
rights fees for complete coverage shows and highlight shows for all of our races
broadcast internationally. Television revenue as it relates to rights fees is
recognized ratably over the race schedule.

         RACE PROMOTION REVENUE. Payments for commercial rights associated with
a self-promoted event that are received prior to the event will be recorded as
deferred revenue. Revenue will be recorded when the event is completed. Expenses
related to these events will be recorded in race promotion expenses.

         OTHER REVENUES. Other revenues include membership and entry fees,
contingency awards money, commissions on part sales and royalty income.
Membership and entry fees and contingency award money are recognized ratably
over the race schedule. Commissions from part sales are recognized when the item
is delivered to the customer. Royalty income is recognized as the related
product sales occur or on a monthly basis based on a minimum guarantee.

Impairment

         We adopted FASB Statement of Financial Accounting Standards (SFAS) No.
142, "Goodwill and Intangible Assets," effective January 1, 2002. The statement
requires companies to stop amortizing goodwill and certain intangible assets
with an indefinite useful life. The statement also requires that we test our
goodwill and intangible assets for impairment upon adoption of the statement and
periodically thereafter. Our goodwill was associated with our acquisitions of
Pro-Motion Agency, Inc. and CART Licensed Products, LP, on April 10, 1998 and
January 1, 1999, respectively. Upon adoption of the statement, we recorded a
one-time, non-cash charge of $1.5 million, or $956,000 net of tax benefit of
$514,000, to write-off the value of the goodwill. The write-off of goodwill
results from the use of discounted cash flows in assessment of fair value for
each reporting unit as required by SFAS No. 142. Under SFAS No. 142, goodwill
impairment is deemed to exist if the net book value of a reporting unit exceeds
its estimated fair value.

         During 2001, we determined that the goodwill and certain long-lived
assets associated with American Racing Series, Inc. (ARS) were impaired due to
our strategic decision to discontinue the operations of ARS at the conclusion of
the 2001 season. As a result, we recorded an impairment charge for the goodwill
and long-lived assets.


Litigation

         We are involved in litigation as a part of our normal course of
business. Our litigation proceedings are included in our most recent Form 10-K,
Item 3: Legal Proceedings and updated, as needed, in Part II-Other Information,
Item 1: Legal Proceedings in this and subsequent Forms 10-Q. Management intends
to vigorously defend against any litigation. When a complaint is filed by or
against the Company that represents a material claim, we disclose the proceeding
in our financial statements. When a claim against us is probable and estimable,
we record the expense. When we are the party filing the claim, we do not record
income until the claim for damages is received.


RESULTS OF OPERATIONS

Three Months Ended September 30, 2002 Compared to Three Months Ended September
30, 2001

         REVENUES. Total revenues for the quarter ended September 30, 2002 were
$18.5 million, compared to $29.6 million during the same period in the prior
year. This decrease was due to a decrease in sanction fees; sponsorship revenue;
television revenue; engine leases; rebuilds and wheel sales; and other revenue
as described below.

         Sanction fees for the quarter ended September 30, 2002 were $12.6
million, a decrease of $9.2 million, or 42%, from the same period in the prior
year. This decrease was primarily the result of amended


                                       13
<PAGE>

agreements with promoters pursuant to which sanction fees were reduced in
exchange for a percentage of the profits from the events as discussed above. The
decrease was also attributable to running eight races in the third quarter of
2002 compared to nine races in the same period in the prior year.

         Sponsorship revenue for the quarter ended September 30, 2002 was $2.9
million, a decrease of $769,000, or 21%, from the same period in the prior year.
This decrease was primarily attributable to the loss of sponsorship income from
the Indy Lights series which we discontinued at the end of the 2001 race season,
as well as a reduction in sponsorship fees from one of our sponsors, pursuant to
a renegotiation clause in the applicable sponsorship contract.

         Television revenue for the quarter ended September 30, 2002 was $2.0
million, a decrease of $398,000, or 17%, from the same period in the prior year.
The decrease was due to a change in our television agreements from the previous
year. In 2001, we received a guaranteed rights fee for both our domestic and
international television rights. In 2002, we purchase the air-time, and we
receive the advertising revenue for our races broadcast on network television.
In the third quarter of 2002, we had three races broadcast on network
television. The corresponding expenses are reported below in television
expenses. Included in television revenue are the rights fees we receive for the
international broadcasts of all of our races.

         There were no engine leases, rebuilds and wheel sales for the three
months ended September 30, 2002, a decrease of $325,000 from the same period in
the prior year. This decrease was due to the discontinuance of the Indy Lights
Championship.

         Other revenue for the quarter ended September 30, 2002 was $1.1
million, which was a decrease of $341,000, or 24%, from the same period in the
prior year. Other revenue includes membership and entry fees, contingency awards
money, royalty income, commission on parts sales and other miscellaneous
revenue. The decrease was primarily due to decreased entry and membership fees
in CART due to fewer entrants and holding one less race, a decrease in royalties
and merchandise sales from licensed merchandise and the loss of revenues as a
result of the discontinuance of the Indy Lights Championship. The decrease was
partially offset by increased revenue from our Toyota Atlantics series due to an
increase in entry fees and from increased commissions on chassis sales when
compared with the previous year.

         EXPENSES. Total expenses for the quarter ended September 30, 2002 were
$32.2 million, a decrease of $1.8 million, or 5%, from the same period in the
prior year. This decrease was due to a decrease in cost of engine rebuilds and
wheel sales, administrative and indirect expenses, litigation expense and asset
impairment and strategic charges. The decrease was partially offset by an
increase in race distributions, race expenses, television expenses, race
promotion expense and depreciation and amortization as described below.

         Race distributions for the quarter ended September 30, 2002 were $8.4
million, an increase of $28,000 from the same period in the prior year. The
increase was due to a $10,000 per race participation payment that we make to all
of our teams, beginning in March 2002. In addition, we have provided $850,000 in
assistance to certain teams in order to ensure their necessary participation in
our series. The increase was also due to an increase in the purse and year-end
points fund for the Toyota Atlantics Series. The increase was partially offset
by travel payments made to teams in 2001 for European travel that were not made
in 2002 and a decrease in CART and Indy Lights purse payments due to holding one
less CART race in 2002 and discontinuing the Indy Lights Championship at the
conclusion of the 2001 race season; we held four Indy Lights races in the
quarter ended September 30, 2001.

         Race expenses for the quarter ended September 30, 2002 were $4.1
million, an increase of $883,000, or 27%, from the same period in the prior
year. The increase was primarily due to freight expenses related to the race in
Rockingham, England. In 2001, the freight expenses related to transporting the
cars and equipment to Europe were paid by the promoters. In an amendment to the
original agreement for the Rockingham race, CART agreed to pay these freight
charges. The increase is also due to increased salaries, fees and travel
expenses in regards to the competition and safety departments. The increase was
partially offset by the discontinuance of the Indy Lights Championship.

         Race promotion expenses for the three months ended September 30, 2002,
were $5.5 million. There were no race promotion expenses for the same period in
the prior year. We entered into an


                                       14
<PAGE>

agreement with Raceworks, LLC to act as the co-promoter of the Miami event. We
funded substantially all of the costs associated with the race in Miami and
incurred $5.5 million of race promotion expenses. The race which took place on
October 6, 2002 has been included in our results for the period ended September
30, 2002. We have included expenses estimated to be in excess of anticipated
revenues from the race. Since the race did not occur until after September 30,
2002, the actual results of the Miami event could differ from these estimates
and will be reported in the fourth quarter.

         There was no cost of engine rebuilds and wheel sales for the three
months ended September 30, 2002, a decrease of $128,000 from the same period in
the prior year. This decrease is due to the discontinuance of the Indy Lights
Championship which was effective with the conclusion of the 2001 race season.

         Television expense was $4.9 million with no corresponding expense in
the prior period. The increase was due to a change in our television agreements
from the previous year. In 2001, we received a guaranteed rights fee for both
our domestic and international television rights with no corresponding expense.
In 2002, we buy the air-time and pay for production expenses for our network
races. In the third quarter of 2002, we had three races broadcast on network
television. In addition, we incur incremental expenses to provide an
international feed for all of our races.

         Administrative and indirect expenses for the quarter ended September
30, 2002 were $9.0 million, a decrease of $837,000, or 9%, from the same period
in the prior year. This decrease was primarily attributable to a decrease in
charitable contributions, professional fees for strategic planning, TV
consulting and employee recruitment and the discontinuance of the Indy Lights
Championship, partially offset by an increase in bad debt expense, legal fees,
public relations and the advance program. Our new advance program team visits
selected race venues prior to the event weekend and invites local media and
corporate guests to participate in activities at the track in order to generate
excitement in the market prior to the event.

         Depreciation and amortization for the quarter ended September 30, 2002
was $357,000, compared to depreciation and amortization of $346,000 for the same
period in the prior year. We ceased amortizing goodwill as of January 1, 2002 in
compliance with the Financial Accounting Standards Board issuance of Statement
of Financial Accounting Standards No. 142, "Goodwill and Other Intangible
Assets."

         OPERATING LOSS. Operating loss for the quarter ended September 30, 2002
was $13.7 million, compared to operating loss of $4.4 million in the
corresponding period in the prior year due to the factors described above.

         INTEREST INCOME-NET. Interest income-net for the quarter ended
September 30, 2002 was $882,000 a decrease of $879,000, or 50%, from the same
period in the prior year. This is primarily due to a decrease in interest rates
and in cash and short-term investments.

         LOSS BEFORE INCOME TAXES. Loss before income taxes for the quarter
ended September 30, 2002 was $12.8 million, compared to loss before income taxes
of $2.7 million for the same period in the prior year due to the factors
described above.

         INCOME TAX BENEFIT. Income tax benefit for the quarter ended September
30, 2002 was $4.5 million, compared to an income tax benefit of $968,000 for the
corresponding period in the prior year. The effective tax rates were 35.0% and
36.1% for the three months ended September 30, 2002 and 2001, respectively.

         NET LOSS. Net loss for the second quarter ended September 30, 2002 was
$8.3 million compared to net loss of $1.7 million for the same period in the
prior year due to the factors described above.

Nine Months Ended September 30, 2002 Compared to Nine Months Ended September 30,
2001

         REVENUES. Total revenues for the nine months ended September 30, 2002
were $43.4 million, a decrease of $12.4 million, or 22%, from the same period in
the prior year. This decrease was due to lower sanction fees; sponsorship
revenue; engine leases; rebuilds and wheel sales; and other revenue, partially
offset by an increase in television and race promotion revenue as described
below.

         Sanction fees for the nine months ended September 30, 2002 were $27.1
million, a decrease of $10.6 million, or 28%, from the same period in the prior
year. This decrease was primarily the result of


                                       15
<PAGE>

amended agreements with promoters pursuant to which sanction fees were reduced
in exchange for a percentage of the profits from the events as discussed above.
The decrease was also attributable to running fourteen races that paid sanction
fees in 2002, compared to sixteen races in the same period of the prior year;
one of the races in 2002 was a self-promoted event, and the revenues from that
event are reported in race promotion revenue.

         Sponsorship revenue for the nine months ended September 30, 2002 was
$8.0 million, a decrease of $2.1 million, or 21%, from the same period in the
prior year. This decrease was primarily attributable to the loss of sponsorship
income from the Indy Lights series as well as a reduction in sponsorship fees
from one of our sponsors, pursuant to a renegotiation clause in the applicable
sponsorship contract.

         Television revenue for the nine months ended September 30, 2002 was
$4.2 million, an increase of $26,000 from the same period in the prior year. Our
television agreements have changed from the previous year. In 2001, we received
a guaranteed rights fee for both our domestic and international television
rights. In 2002, we purchase the air-time, and we receive the advertising
revenue for our races broadcast on network television. In the nine months ended
September 30, 2002, we had three races broadcast on network television. The
corresponding expenses are reported below in television expenses. Included in
television revenue are the rights fees we receive for the international
broadcasts of all of our races.

         Race promotion revenue for the nine months ended September 30, 2002 was
$1.4 million. There was no race promotion revenue for the same period in the
prior year. Race promotion revenue for the nine months ended September 30, 2002
relates to our self-promoted race, the CART Grand Prix of Chicago, and includes
revenues from sponsorships, ticket sales, hospitality sales, and all other
revenue generated by the event.

         There were no engine leases, rebuilds and wheel sales for the nine
months ended September 30, 2002, a decrease of $908,000 from the same period in
the prior year. This decrease was due to the discontinuance of the Indy Lights
Championship.

         Other revenue for the nine months ended September 30, 2002 was $2.7
million, a decrease of $263,000, or 9%, from the same period in the prior year.
Other revenue includes membership and entry fees, contingency awards money,
royalty income, commission on parts sales and other miscellaneous revenue. The
decrease was primarily due to decreased revenue from CART's membership fees due
to fewer entrants, a decrease in royalty and merchandise sales and the loss of
revenues as a result of the discontinuance of the Indy Lights Championship. The
decrease was partially offset by increased revenues from the Toyota Atlantics
series due to increased entry fees and commissions on chassis sales and having
two additional races in the nine months ended September 30, 2002 when compared
to the same period in 2001.

         EXPENSES. Total expenses for the nine months ended September 30, 2002
were $65.9 million, an increase of $8.0 million, or 14%, from the same period in
the prior year. This increase was due to an increase in race distributions, race
expenses, race promotion, television expense and relocation expense, partially
offset by a decrease in cost of engine rebuilds and wheel sales, administrative
and indirect expenses, litigation expenses, asset impairment and strategic
charges and depreciation and amortization as described below.

         Race distributions for the nine months ended September 30, 2002 were
$15.8 million, an increase of $2.0 million, or 15%, from the same period in the
prior year. The increase was primarily due to a $10,000 per race participation
payment that we make to all of our teams. In addition, we have provided $1.3
million in assistance to certain teams in order to ensure their necessary
participation in our series. The increase was also due to an increase in the
purse and year-end points fund for the Toyota Atlantics Series. Toyota Atlantics
held twelve races in the nine months ended September 30, 2002 compared to ten
races being held in the same period in the prior year. The increase was
partially offset by travel payments made to teams in 2001 for European travel
that were not made in 2002 and a decrease in CART and Indy Lights purse payments
due to holding one less CART race in 2002 and discontinuing the Indy Lights
Championship at the conclusion of the 2001 race season; we held nine Indy Lights
races in the nine months ended September 30, 2001.

         Race expenses for the nine months ended September 30, 2002 were $8.4
million, an increase of $633,000, or 8%, from the same period in the prior year.
This increase is primarily due to freight expenses


                                       16
<PAGE>

related to the race in Rockingham, England. In 2001, the freight expenses
related to transporting the cars and equipment to Europe were paid by the
promoters. In an amendment to the original agreement for the Rockingham race,
CART agreed to pay these freight charges. The increase is also due to increased
salaries, fees and travel expenses in regards to the competition and safety
departments. The increase was partially offset by the discontinuance of the Indy
Lights Championship.

         Race promotion expenses for the nine months ended September 30, 2002,
were $8.9 million. There were no race promotion expenses for the same period in
the prior year. Race promotion expenses for the nine month period included $3.5
million of expenses incurred in connection with our self-promoted race, the CART
Grand Prix of Chicago, and include all expenses associated with promoting that
race. We entered into an agreement with Raceworks, LLC to act as the co-promoter
of the Miami event. We funded substantially all of the costs associated with the
race in Miami and incurred $5.5 million of race promotion expenses. The race
which took place on October 6, 2002 has been included in our results for the
period ended September 30, 2002. We have included expenses estimated to be in
excess of anticipated revenues from the race. Since the race did not occur until
after September 30, 2002, the actual results of the Miami event could differ
from these estimates and will be reported in the fourth quarter.

         There was no cost of engine rebuilds and wheel sales for the nine
months ended September 30, 2002, a decrease of $343,000 from the same period in
the prior year. This decrease is due to the discontinuance of the Indy Lights
Championship.

         Television expense for the nine months ended September 30, 2002 was
$9.6 million with no corresponding expense in the prior period. The increase was
due to a change in our television agreements from the previous year. In 2001, we
received a guaranteed rights fee for both our domestic and international
television rights with no corresponding expense. In 2002, we buy the air-time
and pay for production expenses for our network races. For the nine months ended
September 30, 2002, we had seven races broadcast on network television. In
addition, we incur incremental expenses to provide an international feed for all
of our races.

         Administrative and indirect expenses for the nine months ended
September 30, 2002 were $20.8 million, a decrease of $2.0 million, or 9%, from
the same period in the prior year. This decrease was primarily attributable to a
decrease in charitable contributions, professional fees for strategic planning,
TV consulting and employee recruitment and the discontinuance of the Indy Lights
Championship, partially offset by an increase in bad debt expense, legal fees,
public relations and the advance program. Our new advance program team visits
selected race venues prior to the event weekend and invites local media and
corporate guests to participate in activities at the track in order to generate
excitement in the market prior to the event.

         Relocation expenses for the nine months ended September 30, 2002 were
$1.3 million with no corresponding expense in the same period in the prior year.
This expense relates to our headquarters moving from Troy, Michigan to
Indianapolis, Indiana.

         Depreciation and amortization for the nine months ended September 30,
2002 were $1.0 million, compared to depreciation and amortization of $1.2
million for the same period in the prior year. We ceased amortizing goodwill as
of January 1, 2002 in compliance with the Financial Accounting Standards Board
issuance of Statement of Financial Accounting Standards No. 142, "Goodwill and
Other Intangible Assets."

         OPERATING LOSS. Operating loss for the nine months ended September 30,
2002 was $22.4 million, compared to operating loss of $2.1 million for the same
period in the prior year due to the factors described above.

         INTEREST INCOME-NET. Interest income-net for the nine months ended
September 30, 2002 was $3.1 million, a decrease of $2.6 million or 46%, for the
same period in the prior year. This is primarily due to a decrease in interest
rates and in cash and short-term investments.

         LOSS BEFORE INCOME TAXES. Loss before income taxes for the nine months
ended September 30, 2002 was $19.3 million, compared to income before income
taxes of $3.6 million for the same period in the prior year due to the factors
described above.


                                       17
<PAGE>

         INCOME TAX BENEFIT. Income tax benefit for the nine months ended
September 30, 2002 was $6.8 million, compared to an income tax expense of $1.2
million for the same period in the prior year. The effective tax rate was 35.0%
for the nine months ended September 30, 2002 and 2001.

         LOSS BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE. Loss before
cumulative effect of accounting change for the nine months ended September 30,
2002 was $12.6 million compared to net income before cumulative effect of
accounting change of $2.3 million for the same period in the prior year.

         CUMULATIVE EFFECT OF ACCOUNTING CHANGE. Cumulative effect of accounting
change for the nine months ended September 30, 2002 was $1.5 million, or
$956,000 net of tax benefit of $514,000. There was no corresponding amount in
the same period in the prior year. The amount relates to our implementation of
Statement of Financial Account Standard No. 142 pursuant to which we wrote off
our impaired goodwill.

         NET LOSS. Net loss for the nine months ended September 30, 2002 was
$13.5 million compared to net income of $2.3 million for the same period in the
prior year due to the factors described above.


SEASONALITY AND QUARTERLY RESULTS

         A substantial portion of our total revenues and expenses during the
race season is expected to remain seasonal, based on our race schedule. Our
quarterly results vary based on the number of races held during the quarter. In
addition, the mix between the type of races (street course, superspeedway,
etc.), the sanction fees attributed to those races and whether the races are
aired on network television or Speed Channel will affect quarterly results.
During the third quarter ended September 30, 2002, we held eight races: Toronto,
Canada, Cleveland, Ohio, Vancouver, Canada, Lexington, Ohio, Elkhart Lake,
Wisconsin, Montreal, Canada, Denver, Colorado and Rockingham, England.

LIQUIDITY AND CAPITAL RESOURCES

         We have relied on our cash flow from operations to finance working
capital, investments and capital expenditures during the past year. We
anticipate that in 2003, we will use proceeds from our initial public offering
to fund certain of the expenditures that are planned for the year 2003 and
discussed below. We believe that existing cash, cash flow from operations and
available bank borrowings will be sufficient for capital expenditures and other
cash needs.

         We have a $1.5 million revolving line of credit with a commercial bank.
As of September 30, 2002, there was no outstanding balance under the line of
credit. The line of credit contains no significant covenants or restrictions.
Advances on the line of credit are payable on demand and bear interest at the
bank's prime rate. The line is secured by our deposits with the bank.

         Our cash balance on September 30, 2002 was $15.2 million, a net
decrease of $12.6 million from December 31, 2001. This decrease was primarily
the result of net cash used in operating activities of $5.0 million and in
investing activities of $7.6 million.

         We anticipate capital expenditures of approximately $2.0 million to
$3.0 million during the next twelve months. In October 2002, the Company paid
$4.0 million for the purchase of engines for use in our series in 2003 and 2004.

         In April 2002 we entered into a lease for our new corporate
headquarters in Indianapolis, Indiana. The lease commenced on May 1, 2002 and
expires Oct 31, 2010. The total amount due through the life of the lease is $2.6
million.

         We have implemented a stock repurchase program that was authorized by
our Board of Directors in April 2001. The program allows us to repurchase up to
2,500,000 shares of our outstanding stock, of which 1,054,000 shares have been
repurchased for an aggregate of $15.5 million through December 31, 2001. We did
not repurchase any shares in the nine months ended September 30, 2002.
Repurchases under the program will be made at the discretion of management based
upon market, business, legal, accounting and other factors. Accordingly, there
is not a guarantee as to the timing or number of shares to be repurchased.

                                       18
<PAGE>

         Beginning in 2002, we self-promoted the race in Chicago and funded the
race in Miami. In addition, we entered into one new and modified four existing
agreements with promoters to include revenue sharing arrangements with promoters
at their events. The financial success of each of the events, for which we
promote or share in revenues, is dependent on the sale of tickets, sponsorship,
hospitality, signage and other commercial rights associated with the events. Our
increased focus on these activities means that our revenues related to our
sanction fee and race promotion income will be subject to a number of factors,
including consumer and corporate spending and the overall economic conditions
affecting advertising and promotion in the motorsports and entertainment
business.

         The event in Chicago in 2002 resulted in a loss of approximately $2.1
million. The race which took place in Miami on October 6, 2002 has been included
in our results for the period ended September 30, 2002. Since we funded
substantially all of the expenses associated with the race in Miami, we have
included such expenses anticipated to be in excess of revenues expected to be
received from the race. This information is based in part upon estimates and
assumptions since the event occurred after September 30, 2002. Actual results
could differ from those estimates and will be reported in the fourth quarter. We
have also guaranteed a $2 million loan from the Miami Sports Entertainment
Authority to Raceworks, LLC, our Miami race co-promoter. The loan is a five (5)
year agreement, payable in $200,000 installments per year, beginning in October
2002, with a balloon payment in the final year. The initial installment will be
reported in the fourth quarter.

         With the four tracks where we modified our sanctioning fees to share in
the net revenue for the events, we received net sanctioning fees of $4.6
million, which represented a 35% reduction in sanctioning fees compared to 2001
fees for the same events. We anticipate that in 2003 we will again self-promote
the race in Chicago and in Miami. We also anticipate that we will have revenue
sharing arrangements with six promoters in 2003. As a result, the sanctioning
fees that we anticipate receiving in 2003, will be dependent in a substantial
part upon the success of the marketing of each event and, therefore, we cannot
predict our sanctioning fee revenues.

         In 2002, our new television contracts, which run through 2004, require
us to purchase airtime and produce the shows at our expense for the races we
broadcast on CBS and Fox. We retain advertising revenues for these races. Our
fixed costs for 2002 are estimated to be approximately $8.6 million, of which
$7.5 million was incurred through September 30, 2002. These television expenses
were offset by our sales of television advertising in the amount of $1.7 million
through September 30, 2002. We are unable to predict the sales of our television
advertising for the remainder of the year 2002 or for 2003. The amount of
advertising will be based upon a number of economic factors over which we have
no control. The overall state of the economy, the popularity of our sport and
other factors make it more uncertain as to the ultimate profitability or loss
related to our television package.

         In October 2002 we provided a letter of credit in the amount of $1.7
million in regards to the production of conversion kits for race car chassis for
the 2003 season. The letter of credit guarantees that at least 20 of the kits
will be purchased by our race teams. As the kits are purchased the letter of
credit will be reduced accordingly. If 20 kits are not purchased by our teams we
will purchase the remaining kits and continue to sell the kits to teams as they
are needed.

         In August 2002, the Company announced an entry support program to
retain and attract teams for the 2003 season and beyond. This program will
provide up to $850,000 in cash payments to teams for each car entered in the
2003 Championship, up to a maximum of twenty (20) cars. These payments are in
addition to prize money and other non-monetary benefits that accrue to teams
participating in the Championship Series. In return for receipt of these funds,
each team will allocate to CART advertising space on its race cars and other
equipment, which CART will use in packaging advertising that it will market to
potential sponsors. The advertising packages offered to sponsors would include
not only advertising on racecars, but also television, at-track advertising and
additional media opportunities. We are unable to predict how successful our
efforts will be in marketing these packages.

         The Company announced in October 2002, a commitment to invest up to an
additional $30 million to ensure that there is adequate participation by race
teams in the 2003 season. Although the allocation of these funds has not been
finalized, we anticipate that substantially all of the funds will be used to
fund a portion of several teams' overall budget for 2003. We believe that it is
necessary to provide this additional funding to ensure that there are eighteen
(18) to twenty (20) competitive racecars in the field


                                       19
<PAGE>

for the 2003 season. Without this additional funding, it is unlikely that there
will be eighteen (18) teams, which would result in defaults under certain of the
Company's agreements with promoters and television. This could result in the
Company not being able to commence or complete the 2003 race season.

         In light of current events and the overall state of the economy, we are
uncertain whether we or our teams will be able to maintain the same levels of
sponsorship income that we have reported in the past or secure additional
sponsorship. In addition, we are unable to determine what effect these factors
will have on our new television package and our ability to sell television
advertising for our races. We are also unable to assess what impact a decrease
in the disposable income of our fans will have on our promoters and, ultimately,
our races.

         As we have previously reported, we are party to several lawsuits. We
cannot predict the outcome of the litigation, and at this time, management is
unable to estimate the impact that ultimate resolution of these matters may have
on the Company's financial position or future results of operations.

RELATED PARTIES

         We have entered into, and we will continue to enter into, transactions
with entities that are affiliated with our directors and/or 5% stockholders who
are owners of our race teams. Race teams that participate in the CART
Championship receive purse distributions on a per race basis and from the year
end point fund, which amounts have been paid based solely upon their performance
in specific races. All of these payments are made to our race teams regardless
of the affiliation with our directors or significant stockholders. During 2002,
we also paid a participation payment to our race teams, including those
affiliated with directors (or directors who have resigned during the year)
and/or 5% stockholders. The following table provides information with respect to
payments made during the nine months ended September 30, 2002 by us to race
teams that are affiliated with directors and/or significant stockholders of
CART:

<TABLE>
<CAPTION>
RACE TEAM/AFFILIATED PERSON                                       PURSE DISTRIBUTIONS           PARTICIPATION PAYMENTS
---------------------------                                       -------------------           ----------------------

<S>                                                                    <C>                            <C>
Newman/Haas Racing/Carl A. Haas                                        $ 1,282,500                    $ 300,000
Team Green/Barry E. Green                                                1,021,750                      300,000
Chip Ganassi Racing Teams, Inc./Chip Ganassi                             1,201,750                      420,000
Forsythe Racing, Inc./Gerald R. Forsythe                                   859,000                      300,000
Patrick Racing, Inc./U.E. Patrick                                          246,500                      150,000
Derrick Walker Racing, Inc./Derrick Walker                                 258,250                      150,000
</TABLE>

         Carl A. Haas, a director of the Company and a race team owner, is a
principal owner of Carl Haas Racing Teams, Ltd. and Texaco Houston Grand Prix
L.L.C. ("HGP"), each of which have entered into Promoter Agreements with respect
to CART Championship races at the Wisconsin State Park Speedway in West Allis,
Wisconsin and at a temporary road course in Houston, Texas. In the second
quarter of 2002 the Promoter Agreement for the West Allis race was renewed for
the 2002 event with the promoter having the option to extend for the 2003 and
2004 years. The sanction fees payable to CART under this agreement is similar to
those paid by independent race promoters. Pursuant to the Promoter Agreement,
entities affiliated with Mr. Haas have paid sanction fees to CART of $1.7
million. If the option for the Milwaukee race is exercised, sanction fees paid
for 2003 and 2004 will be $1.7 million for each year. In addition, we have
incurred a total of $100,000 in sales costs and $59,000 in marketing expenses in
relation to our race at Wisconsin State Park Speedway during 2002. The promoter
agreement in regards to the Houston, Texas event provided for races to be held
starting in 1998 through 2003. The Houston, Texas race will not be held in 2002
or 2003 due to construction on the temporary circuit in downtown Houston.
Therefore, the promoter agreement has been terminated by mutual agreement. Carl
Haas Racing Teams, Ltd will pay a $500,000 termination fee to CART and CART has
received an option to acquire certain assets of HGP, used in operating the
Houston event, for $750,000; this option must be exercised by December 15, 2002.

         Gerald R. Forsythe, a race team owner and 24.9% stockholder, is a
principal owner of the entities which entered into Promoter Agreements with
respect to CART Championship races in Monterrey, Mexico and Mexico City, Mexico.
Pursuant to the terms thereof, a CART Championship race will be held in
Monterrey through 2005 and Mexico City through 2006. These entities affiliated
with Mr. Forsythe


                                       20
<PAGE>

have paid or will pay sanction fees to CART in the aggregate amount of $6.7
million for 2002, $6.8 million for 2003, $6.9 million for 2004, $7.0 million for
2005 and $4.0 million for 2006.

         In addition, we have paid or anticipate that we will pay a total of
$200,000 in sales costs and $190,000 in marketing expenses to these entities
during 2002.

         In order to change the date of the Mexico City race as requested by Mr.
Forsythe's affiliated entity, we have agreed to pay another promoter $250,000.
Mr. Forsythe's affiliated entity will reimburse us for $125,000 of that expense.

         Mr. Forsythe is also a principal owner of the entity that holds our
Mexican television rights through 2004. In return for these rights, we will
receive a minimum guarantee of $300,000, $325,000 and $350,000 for each of the
three years ending 2002, 2003 and 2004, respectively. In addition, we will
receive 70% of the net profits until we reach $500,000, $550,000 and $600,000
for each of the three years ending 2002, 2003 and 2004, respectively.

            Gerald R. Forsythe is also a principal owner of an entity which
entered into a Promoter Agreement with respect to CART Championship races in
Rockingham, England. The agreement provided for a race to be held beginning in
2001 through 2006. Following the cancellation of the race scheduled to be run in
Germany, officials at Rockingham expressed concern regarding the viability of
running a single event in Europe. In order to assure that the Rockingham event
could move forward in 2002, we negotiated an amendment to the Promoter Agreement
which reduced the sanction fee to $2.8 million and we assumed certain costs,
including freight and transportation, in the amount of $900,000. In addition,
the terms of the future years of the agreement, 2003-2006, are subject to
renegotiation or may be terminated if an agreement cannot be reached. In
addition, we have paid or anticipate that we will pay a total of $150,000 in
sales costs and $51,000 in marketing expenses to this entity during 2002.

         Floyd R. Ganassi Jr., a former director of the Company and a race team
owner, is a principal owner of Chicago Motor Speedway, LLC and has entered into
a Promoter Agreement with respect to a CART Championship race at Chicago Motor
Speedway in Cicero (Chicago), Illinois. Pursuant to the terms thereof, a
Championship race was to be held through 2003. The Chicago Motor Speedway, LLC
was to pay sanction fees to CART of $2.0 million for 2002 and $2.1 million for
2003. In 2002, the Chicago Motor Speedway, LLC announced the suspension of all
race events at Chicago Motor Speedway. We then entered into an agreement with
the Chicago Motor Speedway, LLC where we rented the track for $850,000 in 2002
and promoted the race ourselves.

         Mr. Ganassi is also principal owner of Target Chip Ganassi Racing,
Inc., which has entered into an agreement by which Target Chip Ganassi Racing
Inc. will run a third car for the remainder of the 2002 season. Pursuant to the
terms thereof, we will pay Target Chip Ganassi Racing, Inc. $1.7 million for
running the third car, and we will receive the right to sell certain sponsorship
space on that car. Through September 30, 2002, we have paid $1.2 million of this
amount.

         In addition to the payments described above, CART receives revenues
from its race teams, including those affiliated with CART directors and/or 5%
stockholders, for entry fees, equipment leases and other payments based solely
on participation in CART events and CART's self-promoted event. During the nine
months ended September 30, 2002, race teams affiliated with CART directors
and/or 5% stockholders made such payments to CART as follows:

          Team Green/Barry E. Green                         $ 187,360
          Forsythe Racing, Inc./Gerald R. Forsythe            106,636
          Chip Ganassi Racing Teams, Inc./Chip Ganassi         94,805
          Newman/Haas Racing/Carl A. Haas                     142,368
          Patrick Racing, Inc./U.E. Patrick                    71,500
          Derrick Walker Racing, Inc./Derrick Walker           50,050

         We believe that all of the transactions which we have entered into with
our directors or significant shareholders are comparable to the terms that we
have in the past or could in the future enter into with third parties with
respect to each of these transactions. In order to avoid conflicts of interest,
any of our directors who are affiliated with an entity that is entering into a
transaction with us will not vote on any matter related


                                       21
<PAGE>

to such transaction, and may, in certain circumstances, refrain from
participating in any discussions related to such transaction.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

         With the exception of historical information contained in this Form
10-Q, certain matters discussed are forward-looking statements. These
forward-looking statements involve risks that could cause the actual results and
plans for the future to differ from these forward-looking statements. The
following factors, and other factors not mentioned, could cause the
forward-looking statements to differ from actual results and plans:

         -   competition in the sports and entertainment industry
         -   participation by race teams
         -   continued industry sponsorship
         -   regulation of tobacco and alcohol advertising and sponsorship
         -   competition by the IRL
         -   liability for personal injuries
         -   success of television contracts
         -   renewal of sanction agreements
         -   participation by suppliers
         -   success of self-promoted races and events where we share revenue
             with the promoters
         -   current uncertain economic environment and weak advertising market
         -   impact of engine specifications


ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

         INTEREST RATE RISK. Our investment policy was designed to maximize
safety and liquidity while maximizing yield within those constraints. At
September 30, 2002, our investments consisted of corporate bonds, U.S. Agency
issues, letters of credit, and money market funds. The weighted average maturity
of our portfolio is 314 days. Because of the relatively short-term nature of our
investments, our market risk due to interest rate changes is immaterial.










                                       22
<PAGE>



                      CHAMPIONSHIP AUTO RACING TEAMS, INC.

                           PART II - OTHER INFORMATION


Item 1.           Legal Proceedings

                  On October 30, 2000, a complaint for damages was filed against
                  the Company in the Superior Court of the State of California,
                  County of San Bernardino. This lawsuit was filed by the estate
                  of Greg Moore, a race car driver who died on October 31, 1999
                  while driving his race car at the California Speedway during
                  the CART race event. The suit sought actual and punitive
                  damages from the Company in an unspecified amount for breach
                  of duty, wanton and reckless misconduct, breach of implied
                  contract, battery, wrongful death and negligent infliction of
                  emotional distress. On a motion for Summary Judgment, the
                  complaint was dismissed on all counts on October 16, 2002

Item 4.           Controls and Procedures

                  (a) Within the 90 days prior to the date of filing of this
                  report, we carried out an evaluation, under the supervision
                  and with the participation of the Company's management,
                  including the Company's Chief Executive Officer and Chief
                  Financial Officer, of the effectiveness of the design and
                  operation of our disclosure controls and procedures pursuant
                  to Exchange Act Rule 13a-14. Based upon that evaluation, the
                  Company's Chief Executive Officer and Chief Financial Officer
                  concluded that our disclosure controls and procedures are
                  effective in timely alerting them to material information
                  relating to the Company (including its consolidated
                  subsidiaries) required to be included in our periodic SEC
                  filings.

                  (b) There have been no significant changes in our internal
                  controls or in other factors that could significantly affect
                  internal controls subsequent to the date we carried out this
                  evaluation.


Item 6.           Exhibits and Reports on Form 8-K.

                  (a) Exhibits.

                           10.27    Amendment to the Sanction Agreement by and
                                    between the Company and Rockingham Motor
                                    Speedway dated as of August 16, 2002.

                           99.1     Section 906 certification by Christopher R.
                                    Pook, Chief Executive Officer

                           99.2     Section 906 certification by Thomas L.
                                    Carter, Chief Financial Officer


                  (b) Reports on Form 8-K.

                           We were not required to file a form 8-K during the
                      three months ended September 30, 2002.

                  .




                                       23
<PAGE>



                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                  CHAMPIONSHIP AUTO RACING TEAMS, INC.


   Date:   November 14, 2002      By:     /s/  Thomas L. Carter
           ------------------             --------------------------------------

                                         Thomas L. Carter
                                         Chief Financial Officer




                                       24
<PAGE>


         CERTIFICATIONS
         --------------

         I, Christopher R. Pook, Chief Executive Officer, certify that:

         1. I have reviewed this quarterly report on Form 10-Q of Championship
Auto Racing Teams, Inc.;

         2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

         3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.

         4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

                  a) designed such disclosure controls and procedures to ensure
         that material information relating to the registrant, including its
         consolidated subsidiaries, is made known to us by others within those
         entities, particularly during the period in which this quarterly report
         is being prepared;

                  b) evaluated the effectiveness of the registrant's disclosure
         controls and procedures as of a date within 90 days prior to the filing
         date of this quarterly report (the "Evaluation Date"); and

                  c) presented in this quarterly report our conclusions about
         the effectiveness of the disclosure controls and procedures based on
         our evaluation as of the Evaluation Date;

         5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):

                  a) all significant deficiencies in the design or operation of
         internal controls which could adversely affect the registrant's ability
         to record, process, summarize and report financial data and have
         identified for the registrant's auditors any material weaknesses in
         internal controls; and

                  b) any fraud, whether or not material, that involves
         management or other employees who have a significant role in the
         registrant's internal controls; and

         6. The registrant's other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 14, 2002



/s/ Christopher R. Pook
-----------------------
Christopher R. Pook
Chief Executive Officer



                                       25
<PAGE>


         CERTIFICATIONS
         --------------

         I, Thomas L. Carter, Chief Financial Officer, certify that:

         1. I have reviewed this quarterly report on Form 10-Q of Championship
Auto Racing Teams, Inc.;

         2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

         3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.

         4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

                  a) designed such disclosure controls and procedures to ensure
         that material information relating to the registrant, including its
         consolidated subsidiaries, is made known to us by others within those
         entities, particularly during the period in which this quarterly report
         is being prepared;

                  b) evaluated the effectiveness of the registrant's disclosure
         controls and procedures as of a date within 90 days prior to the filing
         date of this quarterly report (the "Evaluation Date"); and

                  c) presented in this quarterly report our conclusions about
         the effectiveness of the disclosure controls and procedures based on
         our evaluation as of the Evaluation Date;

         5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):

                  a) all significant deficiencies in the design or operation of
         internal controls which could adversely affect the registrant's ability
         to record, process, summarize and report financial data and have
         identified for the registrant's auditors any material weaknesses in
         internal controls; and

                  b) any fraud, whether or not material, that involves
         management or other employees who have a significant role in the
         registrant's internal controls; and

         6. The registrant's other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: November 14, 2002



/s/ Thomas L. Carter
--------------------
Thomas L. Carter
Chief Financial Officer



                                       26