“Finally it’s over” - Palou dispute ends with Ganassi-McLaren settlement
- Archie O’Reilly
- 2 hours ago
- 4 min read
Four-time IndyCar champion Álex Palou is finally free of the contractual dispute which has marred him for three-and-a-half years after a settlement was reached between his Chip Ganassi Racing (CGR) team and McLaren Racing.
It was announced last month that McLaren had been awarded $12 million in damages over a breach of contract after Palou failed to honour an agreement to race with its Arrow McLaren IndyCar team in 2024. No appeal has been made after the court’s judgement and a saga which commenced in July of 2022 has come to a close.
“It’s the first time I can finally say that it’s over,” Palou told the media in St. Petersburg on Friday, ahead of the season-opening weekend. “I can finally focus on what’s important, which is just to race, win races. Very happy about that. Very happy that everything that had to be said has been said. We can finally move forward and focus on this season.”
Disputes commenced when Palou was initially announced to be joining Arrow McLaren for 2023, despite having a contract with CGR for that season. He ultimately honoured his deal with CGR while serving as McLaren’s Formula One reserve driver in 2023, having made a test debut for the team in Barcelona the previous autumn.
But after winning his second IndyCar title in 2023, Palou enacted a U-turn to remain with CGR, realising his goal of a full-time F1 would not be fulfilled from his reserve role, as McLaren signed Oscar Piastri to line up alongside Lando Norris, beginning in 2024.
McLaren took legal action for Palou’s breach of his Arrow McLaren contract. Court proceedings concluded in the United Kingdom this off-season, after Palou had won his third successive IndyCar championship since opting to remain with CGR.
“Over the past few months, I’ve had time to reflect on what has been an incredibly challenging period and I want to address it directly,” Palou said in a statement. “First, I want to acknowledge both [McLaren Racing CEO] Zak Brown and [CGR team owner] Chip Ganassi. Both were put in a difficult position and I regret being in the middle of that.
“Also, in January, a UK judge ruled in McLaren Racing’s favor regarding my IndyCar contractual breach. I respect that decision. I also recognise that the way events unfolded in the summer of 2023 could have been handled differently.”
In his statement, released on Friday, Palou indicated he may not have been advised in the most appropriate way in the lead-up to reneging on his McLaren contract.
“While little of this is publicly known,” Palou’s statement continued, “I found myself pulled in various directions and had the wrong people around me back then, who I believe did not have my best interests at heart. I believe back then that I was provided with the wrong advice or no advice at all.
“In hindsight, had I reached out to Zak directly, perhaps things may have played out differently. McLaren and Zak supported me in many ways, they fulfilled every obligation, went above and beyond and delivered on everything they said in their contracts. I was never misled by McLaren and I very much respect their organisation.”
Ganassi, whose CGR team has now won a record-tying 17 IndyCar championships, believes Palou has been dealt a valuable education throughout the process.
“I cannot condone what happened and I’m glad that the matter is over,” Ganassi said in a team statement. “With the benefit of hindsight, I hope Álex has learned it’s important to keep good people around him, which he now does, so the events of 2023 are never repeated.
“I want to thank Zak and McLaren Racing for now giving us a chance to leave this matter behind us and fully focus on the exciting IndyCar season ahead.”
While the F1-related portion of the lawsuit - relating to McLaren’s commitment to Palou’s testing programme - was dismissed after the court’s judgement, Brown is content after the settlement was reached for the IndyCar portion of proceedings.
On track, his F1 team achieved their second successive Constructors’ Championship title in 2025, as Norris secured the team’s first Drivers’ Championship title since 2008. Meanwhile, Pato O’Ward’s runner-up finish in the standings, alongside Christian Lundgaard’s fifth place, marked the IndyCar outfit’s best season since returning to the sport in 2020.
“I’m very pleased that we have reached a final settlement with Chip Ganassi Racing after a UK judge ruled in our favour in January,” Brown said in McLaren’s own statement on Friday, IndyCar’s opening practice day for 2026. “I want to thank the team working directly on the case for so many months and everyone who supported us throughout the process.
“Pleased we can now return to battling things out on track and focus on what’s set to be an exciting IndyCar season.”
Palou concluded his statement expressing his gratitude to those around him during the process, during which he still became only the fourth driver to win three consecutive IndyCar titles.
“I also want to thank Chip, my teammates and everyone at Chip Ganassi Racing for their dedication and support throughout this process,” he said. “I’ve learned a great deal from this experience. I’m delighted this matter has now settled and I wish to thank all of those involved in reaching an amicable conclusion.
“My focus now is fully on moving ahead where two great organisations that I respect deeply will compete solely on the racetrack.”
Off the back of his eight-win season in 2025, achieved despite the lawsuit still looming, Palou is now vying to become only the second driver to four-peat in the championship in 2026. He also has an Indianapolis 500 crown to defend in May.
When asked on Friday whether the settlement between CGR and McLaren allows him to extend his illustrious stint with CGR any further, his response was firm and delivered with a smile: “Oh, absolutely.”
Above all, at the conclusion of the fiasco, he will not forget the lessons he has been taught.
“I don’t recommend that to anybody,” he told the media. “It’s not a very exciting experience for your life. Learned a lot. I’m glad it’s now over and that it’s in the past. Honestly, I’ve gone through a lot in the last two-and-a-half or three seasons. Ready to get started now in 2026.”
