Ferrari Adds Cashmere for Drivers Demanding Unique Dress: Cars
Ferrari SpA has begun offering personal touches like cashmere-covered seats and gold-colored exteriors for customers who find that cars like the $410,000 620-horsepower 599 GTB aren’t quite special enough.
The “tailor made” personalization program, which started last month, aims to add 20 percent to 60 percent to the price of a car as the Fiat SpA (F) unit looks to pad profit after capping deliveries, according to the Maranello, Italy-based company.
“Being different is important for Ferrari buyers as these cars are all about status,” said Rebecca Lindland, a IHS analyst in Norwalk, Connecticut. “It’s like showing up to a gala in the same dress -- funny at first, annoying if it keeps happening.”
Ferrari is looking for new sources of profit as it limits sales to 7,000 vehicles annually to guard its elite appeal. The supercar maker anticipates reaching that mark this year after selling about 6,500 autos in 2010. The additional lift from the personalization program will help shore up Fiat, which is integrating Chrysler Group LLC, as an economic slowdown threatens a turnaround at its money-losing European business.
Fiat leans on Ferrari as a source of cash to offset falling earnings in mass-market cars. The supercar unit may record an operating profit equivalent to 16.6 percent of sales in the third quarter, compared with a 1.3 percent margin at Fiat Auto, including the profitable Brazilian operations, Mediobanca analyst Massimo Vecchio estimates. Fiat is scheduled to post results on Oct. 27. Ferrari’s operating profit rose 23 percent to 302 million euros last year.
‘100 Percent Unique’
“The exclusivity of the materials and the service level we provide call for a different price,” Nicola Boari, Ferrari’s head of product marketing, said in an interview last month. “The customer has a car that is 100 percent unique because it reflects his choices.”
Ferrari, the Italian automaker’s most profitable unit, wants to maintain the elite appeal of the “Cavallino rampante” supercars by ensuring scarcity, Chairman Luca Cordero di Montezemolo said last month. Sales will only exceed 7,000 if the waiting list extends beyond 18 months, he said. The “absolute limit” on production is 10,000 vehicles, Fiat Chief Executive Officer Sergio Marchionne told Automotive News Europe.
The strategy contrasts with Porsche SE. The Stuttgart, Germany-based maker of the iconic 911 sports car aims to add a second sport-utility vehicle as it looks to double deliveries to at least 200,000 autos by 2018.
Customization programs have become a growing business for high-end automakers, as the wealthy continue to treat themselves, even as the broader economy slows. Daimler AG (DAI)’s Maybach, which starts at $372,500, offers more than 2 million combinations of color, leather and accessories, such as an interior perfume atomizer and hand-braided seat piping.
Bayerische Motoren Werke AG (BMW)’s Rolls-Royce customizes about 90 percent of the orders for the $380,000 Phantom. It started its Bespoke program for the $246,500 Ghost this year, with personalization now approaching half of those vehicles, spokesman Andrew Ball said. The Munich-based carmaker will make the revamped 3-Series more customizable by offering three styling packages, when the sedan goes on sale in February.
“We shouldn’t be too surprised to see carmakers inventing new ways to charge more,” said Simon Empson, the managing director of U.K. auto website Broadspeed.com. “Personalization and individualism are two of the only defense mechanisms available,” said Empson, who previously owned a Ferrari Daytona, which ceased production in 1973.
The Italian sports-car brand designed three collections to help its clients personalize their vehicles. Classica recalls the historical Ferrari GT cars and offers vintage leather interiors. Scuderia, inspired by Formula One racing, includes interior accents from high-tech materials such as Kevlar or carbon fiber. Inedita highlights modern materials and colors and tracks fashion and other trends, including denim interiors.
For an extra touch, Ferrari buyers can visit a special Atelier at the Maranello headquarters, where they will be accompanied by a personal designer who will assist them in styling their car, Boari said.
By restricting production and developing programs for the wealthiest consumers, Ferrari may further insulate itself from the economy, unlike Fiat.
“Our heavy reliance on the depressed Italian market is causing a depressed market share in Europe and that won’t go away until that market recovers,” Marchionne said Oct. 19 in Turin, Italy. “There’s no sign of any substantial recovery.”
For its part, Ferrari targets “significant” results this year, boosted by cars like the new $361,000 four-seat FF. It shrugs off the threat of a slowdown.
“I’m not worried because we have quality, exclusivity, a strong brand and innovative technology,” Chairman Montezemolo said in an interview last month.
Sales of the top ultra-luxury brands, including Aston Martin, Fiat’s Maserati and Volkswagen AG’s Lamborghini and Bentley, are projected to rise 19 percent to 28,090 vehicles worldwide this year, seven times the 2.7 percent increase in overall auto deliveries, according to IHS Automotive.
“It’s important to highlight the resiliency of Ferrari’s results even in a recession scenario,” said Gabriele Parini, a Milan-based analyst with UniCredit, who recommends buying Fiat shares.
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