Ferrari considers boosting its production image

Now an independent company, Ferrari has to bring some changes for the company to further grow, and one way is to push for higher volumes.

The newly independent Ferrari has always relied on the exclusivity concept, but changes have to be done if the Italian supercar maker wants bigger profits. The former Fiat Chrysler Automobile division has always kept a rigid limit on the production capacity, but Ferrari now plans to raise the bar. If the current output cap is at around 7,000 cars a year, the new target could be over 9,000 in 2019, Chairman Sergio Marchionne said at this week’s North American International Auto Show in Detroit. “We need to get there and try to determine whether the market can handle more than 9,000,” Marchionne said. “The founder of Ferrari in 1947 had a clear view that we produce one car less than the market demands, so, as long as we pay attention to that rule, we’ll be fine.”

Another way, rejected so far by Ferrari, is to explore new segments like the sport utility vehicle one. Many exclusive luxury makers have been reluctant at first with the idea. But once taking the step, there was no looking back, as profits have boosted. Ferrari is counting on more mature markets such as the US, which will probably account for 35 percent of deliveries in 2020, up from 30 percent this year, according to estimates from IHS Automotive. Sales are in line to meet a target of 7,700 cars this year, compared with about 7,200 vehicles in 2014. With higher volumes, Ferrari’s earnings would jump to 59 percent from its 2014 level to 1.1 billion euros (1.19 billion dollars) in 2019 if the automaker sells 9,000 cars a year, according to estimates from Massimo Vecchio, an analyst with Mediobanca in Milan.

Via Bloomberg