Mrs.Domenicali
29th June 2008, 06:22
Article from the Telegraph:
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/29/ccferr129.xml
No stopping Ferrari
Last Updated: 2:10am BST 29/06/2008
Ferrari's chairman has overseen a resurgence in the famous marque, and he is far from finished, reports Russell Hotten
Luca Cordero di Montezemolo is an appropriately regal-sounding name for a man whose company produces the king of sports cars. But the chairman of Ferrari (who also chairs Ferrari's majority shareholder, Fiat) is still charmingly enthusiastic about his cars.
Ferrari has seen a resurgence in the famous marque
While he must have been asked a million times about his favourite Ferrari, he shows little sign of boredom when asked a million-and-one times. "I love the 430. Magnifico. But I have two daughters. We can't all travel together [in a two-seater] and my wife gets fed up. So when I drive it, I have to drive alone," he said.
But the car most on his mind at the moment is Ferrari's new California, just going into production and with an expected price-tag of around £130,000, pretty reasonable against the most expensive model, the 612 Scaglietti, which has a starting price of £217,000.
Ferrari has invested heavily - at least €200m (£158m) - in new facilities, including an ultra-modern assembly line on which the 450 bhp California and all future models will be made. It takes three days to build a single Ferrari in the old, cramped factory. And, somewhat surprisingly, Montezemolo says it will also take three days to build a car in the new plant. "It's about improving the quality, and not about speeding up processes," he says. Even so, the new facility is expected to increase Ferrari's production capacity by some 2,000 cars to about 10,000 a year.
Production is, however, tightly controlled. Restricting supply stokes up demand, but it has to be finely balanced. A waiting list of 12-18 months, has now risen to 18-24 months on increased demand from the Asia Pacific region. But if the waiting list is too long, buyers can't be bothered.
Ferrari sold 6,465 cars last year, and wants to top 7,000 in 2008. The company hopes to shift up to 10,000 models in 2010, but one wonders about the impact of the credit crisis. To gauge that, you would need to know how many orders are being placed now for delivery in two years - and Ferrari is not saying. But talk to anyone at Maranello, from Montezemolo down, and they'll tell you that if you can afford to buy and run a Ferrari, you will probably survive the credit crisis.
America is the biggest market, buying 1,600 Ferraris last year. But Montezemolo expects the Asia-Pacific region, which accounted for 1,000 sales last year, to be the big growth area, matching the US market "in four to five years", he said.
A bigger worry are the new emissions regulations. For a company whose brand is built on speed, meeting EU regulations is going to be near impossible.
Ferrari has announced plans to reduce average exhaust emissions from 400 grams per kilometre (g/km) to about 280g/km by 2012. That's a long way from the EU target for Europe's carmakers of 120g/km by 2010.
Motor racing technology - Ferrari spends 18 per cent of revenues on R&D - will help the company to produce lighter, more fuel-efficient cars. But Montezemolo says Ferrari will inevitably have to negotiate an exemption from the EU target. And as for progress on this issue? "Nothing yet. We need more time," he says.
The modern-day Ferrari is very much Montezemolo's creation. Born in Bologna in 1947, the same year that the legendary Enzo Ferrari began making road cars as well as racing cars, Montezemolo became managing director in 1991. He was Enzo's personal assistant in the 1970s, but went on to jobs at Cinzano, Fiat, and running Italy's staging of the 1990 football World Cup finals.
With the support of Fiat, which had taken over the company, Montezemolo put in place a strategy that involved returning Ferrari to profit and returning it to the pinnacle of Formula One racing. The two are inextricably linked, as the road cars draw on the technology of the racing cars.
The money for F1 racing comes from Ferrari and its sponsors. "We do not get a penny from Fiat. I don't think people always realise this," Montezemolo said. "For a small company like us, the achievement, is particularly impressive." Although Ferrari is the only team to have competed in every season since F1 was created, by the 1990s its red racing cars were struggling to keep up.
Now, thanks to Michael Schumacher and his successors, Ferrari has dominated F1 in recent years. Its financial health has also been impressive. In the dog days of 1993, Ferrari made operating losses of €3.8m (£3m) on turnover of €230m. Last year, operating profits were a record €266m, on sales of €1.67bn.
The company sold in 28 markets in 1993. Today it is 52.
Merchandising also brings in the cash, though the figures are not disclosed publicly. There are Ferrari shops worldwide, with one due to open in London's Regent's Street in October. Next year, the first Ferrari theme park opens, in Abu Dhabi - the emirate whose sovereign wealth fund owns 5pc of the Italian company.
It had been expected that once Ferrari returned to sound financial health, it would be floated on the stock market. "Never," says Montezemolo. "Well, a possibility in 10, 15 years - who knows? Not now."
Ask about the reasons behind Ferrari's resurgence and Montezemolo drifts into management-speak. He says it is all about instilling enthusiasm, a word Ferrari wants to imprint in the DNA of its operations. "It creates teamwork and the right environment."
Certainly, a huge effort went into making Ferrari's factories a decent place to work for its 3,000 employees.
Its "Maranello Village" complex provides accommodation for workers who cannot afford to buy houses in the town, and there are subsidised mortgages and other benefits. It's easy to be cynical, but last year a survey for the Financial Times voted Ferrari the best place to work in Europe.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/29/ccferr129.xml
No stopping Ferrari
Last Updated: 2:10am BST 29/06/2008
Ferrari's chairman has overseen a resurgence in the famous marque, and he is far from finished, reports Russell Hotten
Luca Cordero di Montezemolo is an appropriately regal-sounding name for a man whose company produces the king of sports cars. But the chairman of Ferrari (who also chairs Ferrari's majority shareholder, Fiat) is still charmingly enthusiastic about his cars.
Ferrari has seen a resurgence in the famous marque
While he must have been asked a million times about his favourite Ferrari, he shows little sign of boredom when asked a million-and-one times. "I love the 430. Magnifico. But I have two daughters. We can't all travel together [in a two-seater] and my wife gets fed up. So when I drive it, I have to drive alone," he said.
But the car most on his mind at the moment is Ferrari's new California, just going into production and with an expected price-tag of around £130,000, pretty reasonable against the most expensive model, the 612 Scaglietti, which has a starting price of £217,000.
Ferrari has invested heavily - at least €200m (£158m) - in new facilities, including an ultra-modern assembly line on which the 450 bhp California and all future models will be made. It takes three days to build a single Ferrari in the old, cramped factory. And, somewhat surprisingly, Montezemolo says it will also take three days to build a car in the new plant. "It's about improving the quality, and not about speeding up processes," he says. Even so, the new facility is expected to increase Ferrari's production capacity by some 2,000 cars to about 10,000 a year.
Production is, however, tightly controlled. Restricting supply stokes up demand, but it has to be finely balanced. A waiting list of 12-18 months, has now risen to 18-24 months on increased demand from the Asia Pacific region. But if the waiting list is too long, buyers can't be bothered.
Ferrari sold 6,465 cars last year, and wants to top 7,000 in 2008. The company hopes to shift up to 10,000 models in 2010, but one wonders about the impact of the credit crisis. To gauge that, you would need to know how many orders are being placed now for delivery in two years - and Ferrari is not saying. But talk to anyone at Maranello, from Montezemolo down, and they'll tell you that if you can afford to buy and run a Ferrari, you will probably survive the credit crisis.
America is the biggest market, buying 1,600 Ferraris last year. But Montezemolo expects the Asia-Pacific region, which accounted for 1,000 sales last year, to be the big growth area, matching the US market "in four to five years", he said.
A bigger worry are the new emissions regulations. For a company whose brand is built on speed, meeting EU regulations is going to be near impossible.
Ferrari has announced plans to reduce average exhaust emissions from 400 grams per kilometre (g/km) to about 280g/km by 2012. That's a long way from the EU target for Europe's carmakers of 120g/km by 2010.
Motor racing technology - Ferrari spends 18 per cent of revenues on R&D - will help the company to produce lighter, more fuel-efficient cars. But Montezemolo says Ferrari will inevitably have to negotiate an exemption from the EU target. And as for progress on this issue? "Nothing yet. We need more time," he says.
The modern-day Ferrari is very much Montezemolo's creation. Born in Bologna in 1947, the same year that the legendary Enzo Ferrari began making road cars as well as racing cars, Montezemolo became managing director in 1991. He was Enzo's personal assistant in the 1970s, but went on to jobs at Cinzano, Fiat, and running Italy's staging of the 1990 football World Cup finals.
With the support of Fiat, which had taken over the company, Montezemolo put in place a strategy that involved returning Ferrari to profit and returning it to the pinnacle of Formula One racing. The two are inextricably linked, as the road cars draw on the technology of the racing cars.
The money for F1 racing comes from Ferrari and its sponsors. "We do not get a penny from Fiat. I don't think people always realise this," Montezemolo said. "For a small company like us, the achievement, is particularly impressive." Although Ferrari is the only team to have competed in every season since F1 was created, by the 1990s its red racing cars were struggling to keep up.
Now, thanks to Michael Schumacher and his successors, Ferrari has dominated F1 in recent years. Its financial health has also been impressive. In the dog days of 1993, Ferrari made operating losses of €3.8m (£3m) on turnover of €230m. Last year, operating profits were a record €266m, on sales of €1.67bn.
The company sold in 28 markets in 1993. Today it is 52.
Merchandising also brings in the cash, though the figures are not disclosed publicly. There are Ferrari shops worldwide, with one due to open in London's Regent's Street in October. Next year, the first Ferrari theme park opens, in Abu Dhabi - the emirate whose sovereign wealth fund owns 5pc of the Italian company.
It had been expected that once Ferrari returned to sound financial health, it would be floated on the stock market. "Never," says Montezemolo. "Well, a possibility in 10, 15 years - who knows? Not now."
Ask about the reasons behind Ferrari's resurgence and Montezemolo drifts into management-speak. He says it is all about instilling enthusiasm, a word Ferrari wants to imprint in the DNA of its operations. "It creates teamwork and the right environment."
Certainly, a huge effort went into making Ferrari's factories a decent place to work for its 3,000 employees.
Its "Maranello Village" complex provides accommodation for workers who cannot afford to buy houses in the town, and there are subsidised mortgages and other benefits. It's easy to be cynical, but last year a survey for the Financial Times voted Ferrari the best place to work in Europe.