Are California's commanding a premium??

[DM18]

Originally Posted by bdelp

Without question, the 458 is going to be a test if things are like "Ferrari of old" where the dealers could ask for high markups, waiting lists were long, and therefore resale values were high ---OR the used car market will dash that idea and cut into 458 sales and pricing.

458 has a big headwind - since the 430 and 599 resale markets are soft to say the least, many regular buyers will question paying a huge difference for the 458 even though they badly want one. I am seeing more and more of the old faithful feeling "locked-in" to a car they would normally trade because the loss is eroding the feel good factor of a new car.

[Riskinator]

Originally Posted by DM18

458 has a big headwind - since the 430 and 599 resale markets are soft to say the least, many regular buyers will question paying a huge difference for the 458 even though they badly want one. I am seeing more and more of the old faithful feeling "locked-in" to a car they would normally trade because the loss is eroding the feel good factor of a new car.

I agre with you. I get the same feeling from people I talk with.... people are now more cautious.

So... that said... what do you think depreciation rates will be like for the F430, the California, etc.?

[DM18]

Originally Posted by Riskinator

what do you think depreciation rates will be like for the F430, the California, etc.?

No idea. I live in Hong Kong which is a completely different market from the US. We have a 100% first registration tax and most buyers prefer new cars. It is only in the most bouyant markets that young used cars can go for close to cost. Premiums are virtually unheard of for any cars.

My uneducated guess is that the California will depreciate at about the rate of a Porsche Turbo or MB SL63 AMG. 430 will be stronger as the 458 will be a lot more expensive and many people will feel that the difference is a stretch. Nevertheless the 430 will depreciate but the big hit has probably already occurred with the financial tsunami and a killer new model coming fairly close to each other

[bitzman]

There's a quote you hear from Ferrari when asked how many they will make of a limited edition, to whit: "One less than the market demands." I think their solution to countering falling demand in any particular market, say, UK or US, is to, eahc year, open new territories in the most unlikely places like Russia and China. That way, if , say the US. is having a recession, they know there's dozens of new millionaires in Russia and they have only to cultivate these nouveau riche markets. It's really amazing how, in Communist China, they have come in over the transom so to speak and developed clientele there. Same with Rolls Royce and Bentley.
So the art of marketing Ferraris will be in making a small number of cars but constantly endeavoring to find new markets so that if demand slacks off in a traditional area they can make it up in another. There are several countries for instance, that are on the "waiting list" to have authorized dealerships like the Phillipines.
One country that mystifies me is Korea. They have some wealthy people there but I have never heard of a Korean car collector or rare Ferrari in Korea. It could be they have no old car magazines and have no knowledge of the collector car market.

[Trax]

Originally Posted by bitzman

One country that mystifies me is Korea. They have some wealthy people there but I have never heard of a Korean car collector or rare Ferrari in Korea. It could be they have no old car magazines and have no knowledge of the collector car market.

there are lots in Korea

here is a video with an Enzo & F50 http://videos.streetfire.net/video/S...uth_203466.htm

[jjmalez]

Originally Posted by TrojanHorse

+1000%

Allow me to ramble a bit please....

I actually believe that Ferrari may be in more trouble than is generally known.

Of course, they have a deep-pocketed parent--Fiat, but all international auto companies have had a terrible, almost biblical couple years and Fiat is no exception. And if your parent is broke and hungry, like with a lion pride, the cubs get the scraps.

To be honest, as much as he's being vilified, Wiediking at Porsche made a play to keep the company "independent" by trying to leverage a couple of fantastic sales years and shrewd play in options trading into the opposite situation from Ferrari/Fiat--the small, exclusive producer saves itself through controlling a big global producer--VW, thereby laying off production costs and taking the pressure off to continue to have to develop more and more models that are simply too expensive for the market to digest. He also wanted to selectively build production through expanding the brand to completely different markets, ie, Panamara, like he did with Cayenne. (My opinion, the Cayenne hit a rising mkt, thus worked, while the Panamara is foolish try that won't last)

In effect, he made a play like the Hunt's did for the silver market--trying to corner it on the way up and with VW under his control, assure Porsche's independence. Unfortunately when the economy tanked--for him/Porsche--a bit too soon, and then the gov't/workers anger at the "play" delayed the deal, he was left hanging in the square like Musolini. Just as did the Hunt's, he learned lesson #1--don't ever let yourself get "shot" in the back (re: the enemy he made in Dr. Piech) and #2--the best way to make a small fortune is start with a big one.

Game over, Porsche, an independent, world class producer with years of huge profits under its belt, is nothing but the 10th sub of VW. No matter what anyone says, it'll never be the same and Ferry and the Dr are spinning in their graves.

A couple years ago I remember reading that Ferrari had contributed approx $2B to Fiat's bottom line--fantastic for such a small, specialty producer. This year, I wouldn't be surprised if they are no better than break even.

They've spent heavily over past couple years to increase production, on mkting, obviously on design and new model development. No matter how much they off load the costs of F-1 to Shell et al, the team has had a total piss off campaign and costs haven't yet been controlled, so it has to mean they're eating expenses--another unneeded burden on their cash flow and thus parent, Fiat.

All their operating, production and mkting costs have to be laid off somewhere, hence the push to the Cali (and more and more of variant after variant), but trying to "increase" production and models in this market is similiar to trying to pull a plane out of a 5 spin spiral--a lost cause. A few more dollars may come in during year 1 but with a mark like Ferrari, and its perceived super class exclusiveness, all that will happen is killing the goose for the golden egg.

As you, I'd suggest the $200k+ market may be YEARS from returning to the level of 2007. And if Ferrari were able to convince Fiat of this, they'd instead CUT production and models--making fewer not more.

I'd like to see them produce only to order on ALL models and no matter the number orders, hold the 458 to a max of 1,000 units in years 1/2; I'd like to see them build a new GTO 599 run of 250 units as their "excitement/marketing model" and run out the 599 GTB like they did the 430--say 250 max in 2010 (only to order); and, I'd like them to cut the Cali production numbers--since they're already in too deep to cancel it--to no more than 1,500 units. Total production would then be approximately 3,000 world wide of all models in 2010.

They should also sit down with all participants and force a revamp F1 so its financially solvent and beneficial to the companies involved--get rid of Bernie when Max goes and make it work for the players involved, not Bernie's pocketbook--if BMW and Honda can't afford it, and Renault and Toyota are thinking about leaving, its way past the point of sanity.

This would get the company back to what it is--an exclusive producer of exotic, globally desired specialty cars.

They'll "lose" a bit of money in 2010 because of what they've spent in last few years to build capacity--but they'd ensure their mark's value, its reputation and the value of their vehicles and company for the long term. And that's what parent Fiat, Ferrari's workers and Italy actually needs.

Guess my 2 cents is worth about that--but, short of a miracle turn around in the global market, the game they're now playing: increase production, models/variants and milk a weak market by exploiting their brand for the last dollar on the table is about as smart as attacking Russia in the winter. It simply never works.

Very Interesting.

Thank you for the post.

Joe