Ferrari (RACE) – Get Ferrari NV Report likes to do things its own way and at its own pace.
The Italian manufacturer of luxury sport vehicles has chosen to advance in stages in the race for electric cars, despite the EV craze and CO2 restrictions.
Where rivals Lamborghini (VLKAF) , Bentley and Aston Martin announce or tout their new electric supercars, Ferrari has adopted the strategy of small steps.
The Italian group has still not unveiled an electric vehicle; so far, it has preferred to develop and integrate hybrid cars. Ferrari currently sells three hybrid models – SF90 Stradale, Spider and 296 GTB.
“We already started to hybridize our model a few years ago. We have already three model on the road that are pretty much successful,” Chief Executive Benedetto Vigna said on Feb. 2 during the fourth-quarter earnings call. Vigna has been at the helm of Ferrari since Sept. 1.
But the Maranello, Italy, company has decided to follow in the footsteps of competitors and respond to investors and the financial community at large, who expect every automotive group today to have an EV plan. That’s especially since public authorities and regulators are pushing for clean cars.
Keep Pace with Time
Ferrari will therefore comply with the exercise on June 16 at a capital markets day, said its CEO.
‘There is a clear trend, and we will work on for sure an electric vehicle and you will see the strategy line up here in June 16,” Vigna told analysts during the earnings call. “Electrification is one technology like the digitalization that we will harness always in our unique Ferrari way.”
He stressed: “I believe that the electrification is a way – is a technology, the way that can help our brand to keep it the pace with the time. That’s what I believe.”
However, and perhaps to avoid disappointing expectations, Vigna warned that Ferrari’s priority was to listen to its customers above all else.
In other words, Ferrari is not going to go head long into electric vehicles even if the manufacturer will devote an envelope of 800 million euros ($915 million) to investments this year.
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“What I want to say is that there are customers – different customers that prefer different kind of propulsion scheme. So, we are aware of obviously what’s happening. We have planned for that. But we are also aware of the different feelings and different emotions the customer want to get with different propulsion scheme,” Vigna elaborated.
Purists liken Ferrari to a brand with powerful engines, and they believe that abandoning them would be heresy. The idea of a Ferrari without a roaring and emblematic V8 or V12 engine makes some aficionados cough.
But the iconic Italian brand seems to have no choice, as the future of automotive mobility points toward electric cars. Ferrari wants to be able to attract this new clientele.
“You have direct access and good discussion and relationship with your customers. So, what are they telling you? Because on the [Ferrari] Daytona, it seems like they’re saying, hey, we probably don’t want this right now. But the reality is some people might. So, what are your customers telling you right now?” Bank of America Securities analyst John Murphy pressed Vigna on Feb. 2.
Vigna answered him without detour.
“I think that if you want to get my feedback from the customer is that we have customer with different feeling, different needs, different perception, and even the same customer for different moment can have – can prefer the V12, the aspirated one, or the V6 hybrid. So, there is a mix of different customer with different feeling and different need, different emotion,” he said.
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The executive reiterated: “I think that the technology is useful as far as it addresses the customer needs. We have to delight the customer. We have to – this is important for us. So, if we are moving piston or we are moving other things, that’s what we want to do.”
In April 2021, John Elkann, the current chairman and at the time CEO, said that Ferrari’s first all-electric model, an SUV, would arrive in 2025. “You can be sure this will be everything you dream the engineers and designers at Maranello can imagine for such a landmark in our history.”
Two months earlier, the same Elkann told analysts at the fourth-quarter earnings conference that “2030 will still be a year where we will have hybrid cars. So, within this decade we won’t be seeing a Ferrari fully electric. What we will see within this decade is an electric Ferrari,” Elkann told analysts during the 2020 fourth-quarter earnings call.
The high-end brand also seems to respond to European legislation, which wants to ban combustion engines from 2035.
The great rival Porsche is already a step ahead in terms of electrification, with its Taycan model, on sale since 2020, and future 100% electric Macan.
Like other multinationals looking at opportunities for growth in the metaverse, Ferrari is also looking closely at this new world and the technologies that are building it, its CEO says:
“It’s important that we look and we see how the new technologies can help our brand. For sure, the digital technologies, the Web 3.0 technologies that are using the blockchain and the NFT is an area that can be interesting for us. It deserves some attention,” Vigna said.
“There are many – as you know, there is a lot of movement on the market about this. Some companies even changed name, and I think this is an area where we have to put our attention.”
While the concept is still obscure, web3 is a decentralized internet built on the blockchain — unlike the current version, it has the potential to have “shares” that are owned by users in the form of cryptocurrency tokens.
Promoters say that it would be owned “by the people” and less dependent on corporate backing from the likes of companies like Meta (FB) – Get Meta Platforms Inc. Class A Report, formerly Facebook, and YouTube (GOOGL) – Get Alphabet Inc. Class A Report. But, as Block’s (SQ) – Get Square, Inc. Class A Report Jack Dorsey, ex-CEO of Twitter (TWTR) – Get Twitter, Inc. Report, has pointed out, it can instead be subject to the whims of wealthy entrepreneurs who have a lot more money to buy shares than the average person does.
This new iteration of the internet is already embraced by celebrities and athletes through NFTs, nonfungible tokens.
And Ferrari took note.
“It’s an important dimension that we as Ferrari, we have to evaluate to consider for the future,” Vigna said.