CHARLOTTE, N.C. -- Kyle Larson was fired Tuesday by Chip Ganassi Racing, completing a stunning downfall for the budding NASCAR star who uttered a racial slur during a live-streamed virtual race and then watched as nearly every one of his sponsors dropped him.
The 27-year-old Larson, in his seventh Cup season with Ganassi and considered the top free agent in NASCAR just three days ago, is now out of a job in what could ultimately be an eight-figure blunder.
"After much consideration, Chip Ganassi Racing has determined that it will end its relationship with driver Kyle Larson," Ganassi said. "As we said before, the comments that Kyle made were both offensive and unacceptable especially given the values of our organization. As we continued to evaluate the situation with all the relevant parties, it became obvious that this was the only appropriate course of action to take."
Larson was competing in an iRacing event Sunday night when he appeared to lose communication with his spotter on his headset. During a check of his microphone, Larson said, "You can't hear me?" That was followed by the N-word.
He issued an apology Monday, saying there was "no excuse" for his comment, and he apologized in a video posted on his social media accounts.
"I made a mistake, said the word that should never, ever be said," Larson said. "There is no excuse for that. I wasn't raised that way. It is just an awful thing to say. I feel very sorry for my family, my friends, my partners, the NASCAR community and especially the African American community.
"I understand the damage is probably unrepairable and I own up to that. But I just want to let you all know how sorry I am and I hope everyone is staying safe during these crazy times."
Larson was suspended without pay by Ganassi early Monday, then suspended indefinitely by NASCAR. Larson was ordered to complete a sensitivity training.
There were ramifications from Larson's sponsors. McDonald's, Credit One Bank and Fiserv, a financial services technology company that runs the Clover platform that had sponsored Larson, terminated their sponsorship deals, and Chevrolet terminated its personal services relationship with him.
Larson reached out personally to many sponsors and friends to apologize. Brent Powell, president of Plan B Sales and Marketing, was the only sponsor to remain behind Larson. He said the driver called him personally to "express his regret about what transpired."
Without funding on the No. 42 Chevrolet as long as Larson was in the car, the situation became untenable for Ganassi, who made the "emotional call" to dismiss Larson.
"I told Kyle he can come back from this; he can even come back from this with our team," Ganassi told The Associated Press. "But there really wasn't any choice."
Larson, in his seventh full season racing at NASCAR's top Cup level, was in the final year of his contract with Ganassi Racing. He was clearly set for the biggest year of his career and expected to make a decision between loyalty to Ganassi or a move to close friend and fellow sprint car racer Tony Stewart's NASCAR team. He also might have been a long-shot candidate to replace seven-time NASCAR champion Jimmie Johnson at Hendrick Motorsports.
The NASCAR season was suspended after four races because of the coronavirus pandemic.
NASCAR quickly pivoted to create an iRacing league of virtual racing that has engaged viewers and set records for esports television viewership. One of the draws of the platform is that drivers can link into one another on a livestream, where they banter, argue, make jokes and discuss the racing. Fans can listen through the gaming app Twitch.
Larson used the slur during the Sunday night race against drivers from various series. The event was not part of NASCAR's official series.
Drivers in the chat immediately reacted to Larson's use of the slur, with one instantly alerting him, "Kyle, you're talking to everyone, bud." Others were in disbelief.
Larson, 27, has six career Cup wins and finished a career-best sixth in the standings last season.
He is half-Japanese -- his grandparents spent time in an internment camp in California during World War II -- and he climbed from short-track racing into NASCAR through its "Drive for Diversity" program. He is the only driver of Japanese descent to win a major NASCAR race.
His famed sprint car career could also be in jeopardy: Kyle Larson Racing fields a Chevrolet in the World of Outlaws Series that is sponsored in part by Lucas Oil, a company that said it was indefinitely ending its partnership with Larson.
In a statement Tuesday, the World of Outlaws said it doesn't condone Larson's language, adding that he'll be required to complete a sensitivity training course within 30 days. If Larson does so, he'll remain eligible to compete in all World of Outlaws sanctioned events. The statement added that Kyle Larson Racing faces no sanctions and remains eligible to compete in all of its events.
In January, Larson finally won the prestigious Chili Bowl after 13 attempts. He was criticized by NASCAR fans after the Chili Bowl win for calling it the biggest of his career -- just weeks before the season-opening Daytona 500, where he is 0-for-7.
Larson later apologized for downplaying the significance of his NASCAR wins. His victories in Cup have come at California; Dover, Delaware; Michigan (three victories); and Richmond, Virginia. He won NASCAR's non-points All-Star race last season.
The Associated Press contributed to this report.