While we have come to expect stories of strife from General Motors, Toyota and other carmakers, recent rumors of turmoil for luxury carmaker Ferrari caught us by surprise.
Yes, the luxury car rumor-mill was winding on overdrive recently with stories that Maranello had plans to cut production, eliminate positions and idle factories in response to a decreasing demand for their product. Ferrari spokesman Matteo Sardi has been working to dispel the rumors.
It can’t be completely untrue that the company may feel some market pressure, as the exotic car market as a whole has suffered under the economic turndown. But Ferrari has the capacity to weather economic slumps, due in large part to the fact that it’s well-heeled clientele are generally not as affected by them. The company has been communicating this fact.
Also, it is important to understand how the luxury car market operates. Ferrari and other luxury brands, like Lamborghini and Bugatti, know to control production to the point where supply is not able to catch up with demand. This creates the ideal situation for the luxe carmakers, wherein their product is viewed as exclusive, an enviable accessory that buyer’s are willing to pay for-much like a flashy diamond bauble or expensive Louis Vuitton handbag.
So it seems that Ferrari figures out how many cars they will be able to sell, via custom orders, and then they build one fewer. Seems Ferrari is both smart and savvy, and innovative enough to stay in control of business during crisis.
But are the fleet of 200-plus mile per hour Ferraris fast enough to outrun the economic downturn in the long run? It seems even the wealthy are not spending and splurging to the degree they used to (and are used to).
I suppose it depends solely on the type of buyer. While some buyers are willing to wait years for the exact model and personalized amenities they ordered, others are willing to buy a used model for instant gratification. And there are always exotic rental car businesses willing to order the latest Ferrari rental model for their fleet. It seems Ferrari may just weather the economic storm in style.
Post by Imagine Lifestyles Luxury Rentals