By on September 12, 2014

Ferrari_458_Speciale

With the departure of Luca Cordero di Montezemolo from Ferrari, Fiat Chrysler Automobiles CEO Sergio Marchionne will become the premium brand’s chair next month, with the first order of business being to increase output to satisfy more demand.

Bloomberg reports Marchionne will gradually increase annual output from 7,000 to a potential 10,000 units, proclaiming that by doing so, they would be able to match pace with the desires of Ferrari’s customer base, lest its waiting list grows too long “and people get tired.” For this year, deliveries are expected to rise 5 percent.

On the same day Marchionne becomes Ferrari’s new chair, FCA will begin trading in New York. While Ferrari is linked to the company — and is considered a defining brand for FCA — he says it won’t be a key brand over the long term.

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34 Comments on “Ferrari’s Annual Output To Increase Under Marchionne...”


  • avatar
    carr1on

    What does he mean by “it won’t be a key brand over the long term”? Seems like Ferrari is the main brand.

  • avatar
    Waterview

    Perhaps a silly question, but does Ferrari have the factory capacity to increase production by 40% or are they going to run them down the line with Chrysler minivans?

    It would seem they’d need another facility, more tooling, more people, etc. unless they’re going to use other FCA capacity (shudder).

  • avatar
    PriusV16

    It’s astonishing ho quickly Marchionne proves that he doesn’t get the Ferrari brand.

    di Montezemolo put a cap on production numbers to preserve the exclusivity of the brand, realising that Ferrari might lose a lot of its brand cachet if it produced too many cars and became ubiquitous.

    Marchionne, on the other hand, thinks like a numbers man/beancounter — profit, profit, profit; and the brand image be damned.

    This is not a good first sign of his tenure.

    • 0 avatar
      danio3834

      It’s about balance and Marchionne isn’t ignorant to brand cache. He’s talked about limiting Maserati volume, and has said that it’s important for Maserati and Alfa to retain Italian heritage buy building those cars in high cost Italy. Ferrari has a long way to go before they have to start begging people to take their cars, they could build a few thousand more cars a year to increase revenue and profit and not lose the cachet because the demand is there. If Ferrari comes out with an SUV, I’ll eat my shoe and agree with you however.

    • 0 avatar
      psarhjinian

      I’m not so sure. As we hollow out the middle class, both globally and in North America, there’s a lot more very rich people who can make the lease payments on a Ferrari.

      When Montezemolo started out, neither Dubai nor Beijing were infested with money. Now, those two cities alone could consume Ferrari’s yearly output.

    • 0 avatar
      raph

      Well di Montezemolo made the remark that Ferrari had become american.

      Elsewhere the remark went over a commenter’s head so had to explain the insult lies in the American attitude that profit trumps all and American business will mine a brand until its little more than a desiccated husk propped up and put on display for a nickle.

  • avatar
    OneAlpha

    As much as I don’t like Ferrari’s condescending attitude, I can understand their desire to maintain their exclusivity.

    They’ve built their brand on catering to people like corporate CEOs – and I don’t mean the owner of that really successful dirtbike dealership down by the airport.

    I’ve heard it said that that’s what caused Cadillac’s downfall – changing the brand strategy from catering to opinion-makers to selling to just anyone who wanted to buy one.

  • avatar
    Eiriksmal

    Wow. What is that stunning, gorgeous hunk of metal in the foreground? When did Ferraris get beautiful again?

  • avatar
    philipbarrett

    No doubt Porche’s transition from specialty sports car brand to full line automaker has the American business school educated bean counters at Maranello salivating at the prospects.

  • avatar
    CoreyDL

    That silver thing looks like it had an eye job and they forgot to stitch it back up. It’s simply not graceful or appealing.

  • avatar
    bobman

    With global production at 87 million last year, would you say an additional 3 thousand Ferraris should be called a drop in the bucket or a grain of sand in a universe of beaches.

    The number of cars produced by Ferrari was a minor point in the disagreement between the two CEOs. I think Sergio wants Ferrari to appear as more of an active participant in achieving the 2018 goals. He must see that as an excellent marketing strategy.

  • avatar
    TW5

    I can only think of one reason to dilute a brand: If investors and speculators are artificially manipulating supply and demand. Exclusive burgundy wines, for instance, have apparently become investor-grade commodities, imbibed only rarely by the wealthiest of the wealthy. If Ferrari’s order list is comprised of custom one-off garage queens for wealthy celebrities and collectors, it might be in their best interest to raise production. Ferrari came to the same realization with the F40, which was only scheduled for 499 units of production. Demand for the F40 was so great that owners could nearly sell the car for an immediate profit. Naturally, Ferrari raised the price and increased the production quantity to over 1,300 units.

    Perhaps dilution has some place at Ferrari, but it seems to occur once per generation and the trend seems to be product driven. Global QE over the last 30 years culminating in an orgy of wealthy supercar consumers does not seem to fit the bill, imo.

  • avatar
    NoGoYo

    I got an idea…

    Ferrari-up the Alfa 4C and sell it as the Dino.

    • 0 avatar
      Felis Concolor

      Historically, you’re right on target: in ’72, you could either purchase a loaded large station wagon, a well equipped Cadillac, or a Dino, each of which was priced within a couple hundred dollars of one another.

  • avatar
    stuki

    Seems less like a disagreement over whether to dilute the brand, than about how to avoid the brand being diluted in the first place.

    Marchionne seems concerned that excessive waiting lists, risks having some who could otherwise have been made committed to the brand, get a McLaren, Lambo, or high end P instead. Ferrari’s existing customers in the West are already rich. And current policy ensures they will only get more so. Yet F cannot risk sending no cars to the emerging wealthy in Moscow, Beijing or wherever, thereby giving the other pretenders to the throne a foothold. At current production, F would have to make a choice between never getting the status in the new bling markets it currently enjoys in the West due to lack of presence, or risk having snubbed Western customers pan the brand as “status toys for Russian Oligarchs.” 7K to 10K is not in and of itself enough to do much in the way of dilution, if the added production goes to hitherto unversed markets. Of course, if 7 becomes 10 becomes 15 becomes 25 becomes a “designer” brand sold at Target……..

    • 0 avatar
      VenomV12

      Ferrari will never have a problem selling their cars, well unless they dilute the market. From what I have seen most people that leave Ferrari to try McLaren or Lamborghini or something else almost always return to Ferrari. Most of the guys I know that own Ferraris either own multiple Ferraris or are on their 2nd and third ones. Hell look at Chris Harris, Ferrari treated him like a stray dog, worse than one, and he basically begged them to come back and let him drive their cars and has bought 2 or 3 Ferraris since.

      • 0 avatar
        stuki

        But Chris Harris matters much less than Ching Chong for the future of Ferrari. And unless Mr. Chong gets a Ferrari allocation sometime this decade, he will buy a competitor; and like all purchasers of expensive items that are only different in the six of one, half a dozen of the other, way, he will then start building an elaborate fortress of rationalizations for why HIS brand is in fact THE brand.

  • avatar
    RHD

    They can’t let Hyundai have an opportunity to offer a competing supercar at 10% off the standard price… it would have a Ferrari nose, Audi wheels, a Lamborgini rear with Aston Martin taillights, a Roadrunner rear wing, Chrysler 300 windows, Delorean doors, Perodua suspension (since you can’t see that part), a Kia engine and the interior from the Santa Fe, with which it would share the assembly line.

  • avatar
    superchan7

    This is a relatively small experiment compared with Porsche whose cars are much more affordable on average. When the upper class doesn’t know what to do with their money, you can’t really dilute your brand by selling more of your $300k sports cars. It’s still out of reach for normal people.

    Porsche is reaching further downward in the market with cheaper CUVs, which is what critics call diluting the brand. Anyone with half a brain can get a looooong term loan or lease deal on a base Cayenne.

  • avatar
    JMII

    If people are waiting over a year for your product then building a few more is the smart move. People with Ferrari kind of money could easily leave the brand if another option is available sooner. These people are used to being spoiled with amazing service, been told to “wait” is not in their vocabulary. This is why the used market for Ferrari’s has always been so hot. An used pranching horse is one you can drive home TODAY, if not your have the misfortune of waiting until next year… kind of like their F1 team. Diluting the brand? Please they can always just RAISE the price with a “rush” delivery charge or withhold a special color or model to create a more exclusive experience.

  • avatar
    Car-los

    Marchionne is probably considering joining the Mexican assembly fiesta and follow the example Honda, Nissan and Mazda!!!!!

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