My neighbor is a huge car guy and owns everything but Ferraris because “they make you buy all the shitty Ferraris before they’ll let you buy the good ones” :p
One should remember that Ferrari was effectively on the verge of bankruptcy for most of Enzo's tenure as leader. Eventually he was forced to sell to FIAT, and spent his last few years pretending that he was free to make the choices that FIAT's owner Agnelli wanted him to make. Ferrari eventually turned a corner once Enzo died.
Enzo Ferrari always wanted to make a better Alfa Romeo, and he did. Branding was a side effect that other people exploited later.
As for stock price, it's not reflective of their core strategy, it's reflective of an explosion in demand that is apparently starting to soften.
I’m surprised that the current AI boom isn’t called out in the comments or the article. From my POV technology investing is the poster child for the issue discussed. The internet bubble, online ads, crypto, and AI all fall short of the promise of RoI.
Car companies fund racing to sell consumer cars.
Ferrari sells consumer cars to fund racing.
Enzo is rolling in his grave!
"I don't sell cars; I sell engines. The cars I throw in for free since something has to hold the engines in." --Enzo Ferrari
A couple years before Enzo died, there was a TV tire commercial which asked "Why do Ferraris come with Firestone tires? Because Mr. Ferrari wants it that way." and then showed a picture of Enzo smiling.
(I don't recall if it was Firestone or Goodyear.)
I'm currently listinging to Founders Podcast - The Obsession of Enzo Ferrari[1]
Though some of the points may be correct under current management, I think this quote would have Enzo turning in his grave "We are not – we are not – a car company. We are a luxury company that is also doing cars."
This playbook where you put your brand on a bunch of random things to sell, while the prime focus gets watered down only works for a short period of time.
Aston tried the same thing, going so far as putting their badge on child strollers.
The car industry is going through such upheaval that much of this may not matter in the next 20 years, but I fear they are going to destroy a great brand through a lack of focus.
[1]https://open.spotify.com/episode/2O6toYAw3RjjTQ4SEzKIru?si=1...
TFA explains the true driving force behind Enshittification.
It takes a very strong will to say no to growth and investment, because you know it will make what you do change from excellence in to shit. Sometimes your customer base morphs (see Facebook) and you survive. Sometimes your only market was the high end discerning customer, and now that you’re shit, you’re dead.
<FUNNY> Well their job currently is certainly not being a winning F1 team ;) </FUNNY>
>why don’t more companies follow Ferrari’s lead
Ford did try before. For example, the 2006 Ford GT. In comparison, the similarly-priced Ferrari F430 of the era was the mass market automobile with about 5x as many made.
So I wonder how much one should draw from these rationalizations of prestige marketing. At the end of the day Ferrari still uses its larger super-car production capacity to keep even Ford only an occasional entrant into the low-end of market.
I mean, by the numbers in the article, Toyota has produced about $100B of net profit over the 5-year period, while Ferrari has produced $6B.
I guess I'd rather own Toyota.
>“We are not – we are not – a car company. We are a luxury company that is also doing cars.”
Replace Ferrari with Rolex and it's basically the same article. Veblen is such a good business model and place to work, if you can hack it that is.
Imagine you're a sales guy at Honda dealership, well you have to work hard to convince the middle aged dad why buy a CRV instead of a Toyota RAV4.
However, if you work at a Bugatti dealership, you don't need to convince the oil-rich Sheikh why he should buy the 2 million dollar car, he already wanted to buy it before he even stepped in. So not only is your job easier than the guy in the Honda dealership, it's also much better paid. The very definition of inequality. The same is true for other businesses. It's much easier and profitable selling Azure /Office 365 subscriptions to businesses, that some SW solution from a mom & pop shop.
Enzo is literally projectile vomiting in his grave right now.
This is not the Ferrari he created. This is the corpo-monster called "brand". Yuck.
My understanding was that Ferrari was in the business of selling a very specific badge, a very specific engine purr, a very specific shade of red and a certain relative level of dynamic performance - the absolute value of this last one changes with time. All this on 4 wheels.
Are you telling me that selling branding rights to Acer laptops and to cheap cologne is (an important) part of their core business?