They say the superrich are different, and the same goes for their favorite sports-car maker. Ferrari, which launched a new strategic plan on Thursday, must keep it that way.
When the Italian company announced its last such plan in 2018, its big challenge was to create a sport-utility vehicle that stood out from the others. The result—its precursor or “perfect” model—at last will be unveiled in september, New chief executive Benedetto Vigna’s key message on Thursday was that the model, which he has never described as an SUV, would look and drive like a Ferrari sports car.
Today’s equivalent of the Purosangue is the full-electric vehicle that Ferrari has promised for 2025. Like Purosangue, it could bring the company another lane for new customers and growth. Also like the Purosangue, it clearly does not fit in with the Ferrari brand. So the company’s challenge remains largely the same: to create an EV that stands out from the others. And in 2025, Mr. Vigna’s main message will undoubtedly be that the brand’s first EV will look and run like a Ferrari sports car.
The difference is central to Ferrari’s appeal to both customers and investors. It appears that wealthy car buyers are unable to find the same products elsewhere, giving the company pricing power. It already throttles margins a lot compared to other carmakers, and the company feels like there’s still more to do. Its plan forecasts a 27% to 30% increase in operating margin in 2026, up from 23% to 24% this year.
Investors accordingly value it differently from the rest of the car industry, where competition is intense. The stock currently trades at 32 times forward earnings, in line with the best European luxury names. Other auto-maker stocks receive single-digit multipliers.
That’s why the question of properly disassembling its EV is all-important for Ferrari, and it went to lengths to convince investors that it has answers. It will not make its own battery cells, which Mr. Vigna describes as a commodity. Yet they did store much in how the cells would be packaged, and the technical synergy between traditional powertrains and their electric counterparts. Ferrari expects its “electric engine” to increase power density by 10% every two years starting in 2026, through improvements in areas such as cooling, insulation, magnets and conductive materials.
As far as the thorny question of engine noise that is so central to the brand, the company only said that its EV would produce a “unique Ferrari sound”. We’ll have to wait and hear.
Even more is riding on the success of the EV than the SUV. While Purosangue will represent no more than 20% of sales over its lifecycle, Ferrari said EVs will account for about four out of 10 models sold in 2030. Regulators are pushing the technology more aggressively, especially in Europe, where members of the European Parliament voted last week to support Ban on fossil fuel vehicles by 2035, Ferrari may be able to maintain its internal combustion engine and hybrid lines of cars by promoting sustainable fuel – the direction in which Formula 1 motor racing is headed.
It is sometimes assumed that all EVs will feel drive-like given the greater simplicity of their powertrains. Thereafter, luxury brands will have to differentiate themselves through other factors like cabin comfort, services and styling. With its sole emphasis on driving experience, Ferrari is at stake more than any other carmaker in proving conventional wisdom wrong.
write to Stephen Wilmot et stephen.wilmot@wsj.com
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