Ferrari SpA is an Italian luxury sport car manufacturer, based in Maranello and founded by Enzo Ferrari in 1947. The history of Ferrari is strictly linked with his founder. It is a story of of tradition and innovation. Enzo Ferrari felt an impressive draw to race since he was young. He debuted the first Ferrari race car, the legendary 125 Sport. The Scuderia Ferrari Race Team started to win more and more races. In 1988 Enzo Ferrari died and FCA (FIAT Chrysler Automobiles) stake in Ferrari was 90% while the remaining 10% was held by his son Piero Ferrari, who is still the Vice Chairman of the company. In 1992, FCA hired Luca Cordero di Montezemolo as CEO and Chairman of Ferrari. Montezemolo made important changes, increasing the line from two outdated models to nine new ones and a commitment to engineering excellence was instilled. A key aspect of Montezemolo’s quality and branding strategy over the period from 1992 to 2014 involved holding production volumes below demand in order to generate a perception of exclusivity. On 10 September 2014, the Fiat Chrysler Automobiles group announced that Luca Cordero di Montezemolo, Ferrari’s chairman for over 23 years, will retire. He was succeeded by Sergio Marchionne. In 2014, FCA Group announced its intentions to separate Ferrari SpA from FCA. The separation began in October 2015 with a restructuring that established Ferrari NV (a company incorporated in the Netherlands) as the new holding company of the Ferrari group and the subsequent sale by FCA of 10% of the shares in an IPO and concurrent listing of common shares on the New York Stock Exchange. Piero Ferrari continuing to own the 10% of shares. The fundamental purpose was to succeed in positioning the brand by bringing it closer to the valuations typically assigned to the luxury sectors rather than those of the automotive sector. By 2019, Ferrari outperformed even the most important luxury players listed in Europe, breaking away sharply from what are the numbers used by car manufacturers such as FCA, Volkswagen, BMW and Mercedes. After the untimely death of the enlightened and visionary CEO, Sergio Marchionne, in the summer of 2018, Louis Carey Camilleri, former CEO Philip Morris was named the CEO of FCA, while John Elkann, the owner of the FCA group became the President of FCA. The case discusses the (a) evolution of Ferrari, its brand DNA and its tradition to match continuously tradition with innovation (b) it analyzes how Ferrari creates a unique value in all its business areas (c) it dwells with its hybrid challenge in the face of disruption in the automobile industry be it by electric and autonomous vehicles or by introduction of SUV model (d) its strategy of demand frustration and category segregation for emerging markets.
SOM, A. (2019). Ferrari: The Hybrid Challenge? ESSEC Business School.