Help needed to buy a new Ferrari

Hi, Marcos,

I am a newer owner, and my 2012 California is my first Ferrari. From the description you gave, I probably know cars more due to my work doing futures forecasting and trends identification (cars, fashion and economics are leading indicators, all of which are heavy into design and cultural movement, so I follow them). I had always been saving for an Aston martin, but when it came to the actual purchase, the test drives of both AM and F Cars easily changed my mind. There are a number of sincere, ongoing debates about Ferraris, such as: 8 versus 12 cylinders (e.g. older models with 12 cylinders plus the new F12 versus the 458 and California); stick versus paddle shifts (Ferrari and most others are moving to paddle shifts, which is a lot of fun, but away from the traditional performance driving experience), aesthetics, modifying your cars, etc. It should come down to what you really like, how you see yourself using the car, and then what fits your list of desired and necessary options.

I prefer to drive mine, and plan to use it for weekend trips at distance. I also love convertibles. I bought a California that happened to be sitting on a dealer floor (Ferrari dealer) optioned as I wanted. That is a rare circumstance in most cases, although if you use the DuPont Registry, you can scan what is out there and where. If you buy used, you need to have a PPI (pre-purchase inspection) done unless the car is under warranty (and even then, it's a good idea). Ferraris cost what they cost, and there is scant room for negotiation. You do not need to buy a used one to order a new one, but their preferred customers seem to be able to move faster through the waiting process than someone off the street.

There is no way to logically justify the purchase, so don't worry about it making sense to anyone but yourself and your family (e.g., don't get one instead of sending kids to college, etc.). Ferraris (and other exotics) are really different than other cars; someone told me it is like dating a supermodel- looks fabulous and tremendous fun, but the maintenance and carrying costs are pretty steep. Insurance, repairs, and other things can add up. That means you want to have disposable cash to pay for ongoing costs (like buying a house).

I love my California, even though some folks metaphorically throw rocks at it and make fun of the rear deck height, that it only has 8 cylindres, etc. For the rest of the world, all they know is that it is a Ferrari, and the response I get from normal people has been great. The 458 is a magnificent car, and looks every bit like a Ferrari should. You can't go wrong with it, but want to be deliberate about what you may want in it (seat options, power options, etc.). The 458 is also less versatile (for me) to drive to vacations (harder feel, twitchier re steering, etc.).

The average person ordering a new F Car spends about $38K US on options. I have the upgraded driver's zone with Carbon steering wheel, power seats, red calipers (to go with my red car) and upgraded wheels (20" spokes). It also had a factory clear bra, which is also a personal preference, but which I love. I have a list of other things, but most others also order theirs with similar things. Check DuPont's cars for sale to get an idea of what usually comes on them.

Once I got mine, I had it color-corrected (in depth detail and sealant) which worked well. I also have started to do all of my own washing and cleaning (which I actually enjoy). Resale and residual are not big concerns, although I have given my wife instruction re what to do if I pass away and she needs to dispo it hahaha. The only way I might sell it is if they start making a F12 spider (as said, I love convertibles, and the California is one of the few convertibles ever made that look as good with the top up and top down).

Hope this helps; lurk on the various threads on this board and don't be afraid to go into a Ferrari dealer to ask questions. Ask questions here also, but look for your answers first in the threads or on their search function; most of the normal new guy things have been asked a number of times (some by me, as you'd see on the California thread). Take your time, and don't settle for anything less than what you finally choose to get.

Best Regards, Bob H

 

Much respect Marcos!!!

I have been saving for 8 years, but you have been working much harder than me, as I only have about a third of what you have in my fund. As I get ever closer, I am steering away from newer cars. If you are like me, we will only have one shot at this, and I cannot see all the hard work wasted through depreciation.

A 458 will start depreciating $15k per year soon, in my case I like to keep good cars for a number of years.

So I'm looking at cars that have already depreciated 50%.

But whatever you get, you will have deserved it.

 

I don't think there's a great deal of truth to the idea that Ferrari will only sell to certain people, nor that you must first purchase a used Ferrari.

I recommend attending several car shows featuring Ferraris. Most owners, at least around here, are friendly and eager to tell you about their cars, particularly if you approach them at a show.

This site will have a section dedicated to the area where you live, and it shouldn't be difficult to find some information about car shows or Cars-and-Coffee events.

The Ferrari Clubs don't require that you actually own a Ferrari to join. This is another way that you could attend some events, see some cars, and get to know the people who own them.

Once you've made up your mind, I would suggest telephoning a dealer and simply telling him everything you've told us here, although by then you might have a better idea of which model is right for you. Considering the amount of money you have saved up, I think it is highly doubtful that any dealer will just tell you to get lost. Many people have to take out a loan to buy their first Ferrari, but with the amount you have saved up, you probably won't have to borrow.

It is true that some of Ferrari's "supercars" (the 288GTO, F40, F50, Enzo, and now the La Ferrari) were/are only available to "select clientele." But you probably won't be wanting a $1m+ car as your first Ferrari, anyway. If a dealer is rude to you, just call up another one.

I would never recommend spending all the money you have to buy a Ferrari. They do require maintenance, and not everything will be covered by warranty. Spend about 2/3 of what you have, possibly a bit more.

Don't dismiss the idea of buying a used Ferrari if the model you really like is no longer made. With the money you have, you could purchase a tight 360, 430, or 550 fairly easily. All great cars, and still often available from dealers as gently used cars - often with a warranty.

Then, once you do get your Ferrari, work to develop some mechanical ability. It won't take long to learn some basic troubleshooting and repair skills. It's well worth it to learn, both in terms of saving some significant money on fairly simple repairs and the increased enjoyment one gets from ownership when one has the knowledge that s/he can do a bit of the work himself.

Please let us know what you eventually decide to get, and post photos once it's yours.

 

Marcos - congratulations, it sounds like you've put some real work into getting to this point...

1. I know for a fact that you can certainly buy a new Ferrari without first purchasing used. I have a friend who recently ordered a 458 and has been waiting patiently since last year for it to arrive. He makes PLENTY of money (7 figures annually), so there was no saving for him. He rented one for a weekend from an exotic rental outfit just to make sure it was what he wanted. After making the decision, he went and ordered it... nothing too dramatic. But, having said that, I've heard some of the same lure - perhaps it's a dealer by dealer thing, but I'd imagine if your money is green, they'd be smart to take it.

2. From a financial perspective, I'm not sure what the rest of your situation is like, but I'm not sure I'd spend $300k on a new Ferrari without serious consideration with respect to your other life goals. If you've been saving this long, that's probably something you've done more than one time, I'd think. My personal take on it, though, is that these things will depreciate big-time, and unless you have very serious cash to blow, I'd always look used. You can get a used 458, as well, with at least SOME of the depreciation hit taken, and I'd suspect it would be very similar to new.

As an example, if you're 65 years old with $2.5M in the bank for retirement, a paid-off house, and kids are through college, spending $300k on a Ferrari (in a separate fund) that you'll have until you die might be a nice treat. But if you're 45 years old with only $150k saved for retirement, a mortgage still looming, and two kids yet to send to college, I don't think there's any way to justify spending $300k on a car. So, I guess I'm just saying that it should all come down to the bigger picture of your finances and goals. Spending $300k on a car is a BIG luxury, after all. It really should be in context to your situation.

I'm personally shopping for my first F-car now. I'm going to start used and contain my expenditure to something in the $50k - $70k range, which is a small fraction of my annual salary. While I'll still take the purchase seriously, and the car will be loved and cared-for, owning it won't stress me out - relative to the bigger picture, it's affordable, totaling it would be sad but not a financial disaster, etc.

So, I don't mean to be a downer (and I certainly don't want to sound judgmental - I know nothing of your situation), but if you feel you're purchasing out of your league (not the target client), I'd think hard before dropping this type of cash... not because of any social class garbage - money doesn't make anyone better or worse than the next guy! - but more so because I wouldn't want to see you spend more than you can really afford, putting things like long-term financial strategies for retirement, health care, your home, college, etc, at risk. Having the cash to buy something, after all, doesn't necessarily mean it's an affordable (or wise) purchase in the bigger scheme of things.

My recommendation:

- Make sure all of the following are prioritized BEFORE the Ferrari:
-- Retirement
-- Healthcare
-- Housing
-- Education (yourself and kids)

- If your retirement savings are on-track (e.g. saving at a rate that lets you retire comfortably by 65 max), your mortgage is under control (will be paid off by retirement), you have a healthy plan for kids' college (529 plans), etc, then you probably have priorities in order. If not, I'd reconsider.

- If all of the above is in order, I'd still say to spend no more than $100k of what you saved. You're going to learn stuff owning your first Ferrari - I'm not sure I'd want to learn any tough lessons on a car that took you 7 or 8 years of saving and working 80 hour weeks. I'd spend no more than what you could comfortably replace within 24 - 36 months of MODERATE saving (not sacrificing other priorities). I think you can spend less than $100k and get a GREAT relatively modern car as your first Ferrari. The rest of the money can be invested.

Just my 2 cents!

 

Good advice Eric...