Toyota is expected to lose nearly $5 billion and Nissan is out $3 billion. Meanwhile in Maranello, Italy, life goes on unchanged... at least for now. Ferrari has just released its 2008 financial results, and while the rest of the automotive world is trying to keep its head above water during the global economic downturn, Ferrari's numbers are good. Very, very good, in fact. Despite reports that sales tanked in the final months of the year, it doesn't seem to be reflected in the numbers. Volume was up 2% with 6,587 cars delivered to end customers in 2008. The US market still absorbs the biggest chunk of sales, with 26% of all deliveries, but Eastern Europe is the biggest growth market, jumping 23%.
Overall, Ferrari profits were up 27% to €339 million ($441 million) and the return on sales was up to 17.6%. Profits were no doubt heavily assisted by the new One to One personalization program on the V12 cars, allowing owners to spend exorbitant amounts on custom bits for their new steeds. Chairman Luca di Montezemolo acknowledged that, "The economic climate in 2009, still remains very uncertain as the crisis takes its toll across the globe and it is hard to say how the situation will develop from here." It seems highly unlikely that the company will be able to repeat this performance in 2009. So the question now is how big of a hit will it take?
[Source: Ferrari | Image: Giuseppe Cacace/Getty
Another record year for Ferrari
- ROS rises to 17.6%
- Investments at 18% of revenues
- Growth continues in Emerging Markets
- Complete energy self-sufficiency within 12 months
Once again in 2008 Ferrari delivered results that beat all previous Company records. The strong Return on Sales (ROS) growth seen in recent years continued, reaching 17.6% compared to 15.9% in 2007. This was an outstanding result in the car sector in general and is especially impressive given the very tough economic backdrop against which it was achieved, particularly in the second half of the year.
This important result comes courtesy of Ferrari's diverse range of products and strict cost-cutting measures. That said, investments in research and development increased, reaching 18% of revenues in 2008. Improvements and efficiencies also helped compensate for unfavourable dollar and sterling exchange rates.
In addition to the above-mentioned structural improvements, Ferrari also launched a range of major commercial initiatives in 2008, including the new One to One Personalisation Programme for its 12-cylinder models and a new client assistance programme. Ferrari also enjoyed strong growth in the Brand related activities (licensing, retail and e-commerce) with +28% overall, the e-commerce segment performing particularly well, as revenues there boomed by over 65%.
Commenting on the figures, Ferrari Chairman Luca di Montezemolo declared: "Ending 2008 with results unprecedented in the entire history of the Company is the best endorsement we could have of our strategy of exclusivity, innovation and focus on people. These results beautifully cap a truly exceptional year that saw us once again at the top in Formula 1, winning our 16th Constructors' title, our eighth in the last 10 years."
"The economic climate in 2009," continued the Ferrari Chairman, "still remains very uncertain as the crisis takes its toll across the globe and it is hard to say how the situation will develop from here. That means, of course, that Ferrari will have to lavish even more attention on every single detail and continue to innovate whilst preserving the exclusivity of our products with respect to market demands."
Ferrari ended the 2008 financial year with revenues of 1,921 million euro, an increase of 15.2% on the 1,668 million euro recorded in 2007. This rise comes mainly as a result of sales of the 430 Scuderia and the excellent performance of both the 612 Scaglietti and 599 GTB Fiorano 12-cylinder models which benefited from the launch of the One to One Personalisation Programme. The Ferrari California, however, made no contribution to the 2008 figures as the first examples are only being delivered to their owners in the next few days.
A total of 6,587 cars were delivered to end clients in 2008, an increase of 2% with respect to the 6,465 cars delivered in 2007. North America remains the Prancing Horse's largest market with 1,700 cars (26% of the world total) sold there in line with the 2007 figure, a particularly significant result given the economic downturn there. Sales to Eastern Europe continue to grow (+23%) while deliveries to the rest of Europe were in line with the results achieved last year.
Sales to the Middle East and South Africa continue to grow, with 366 cars delivered, an increase of 12% on the previous year's figure.
In the Asia-Pacific region, Ferrari delivered 1,089 cars to end clients. Japan remains the primary market in terms of sales volumes with 433 cars delivered to end clients in 2008, an increase of 15%, while we exceeded 200 cars delivered in China for the first time, an increase of 20% on 2007 to 212.
On a further positive note, Ferrari returned a trading profit of 339 million euro in 2008, an increase of 27% on previous year's figure.
The Prancing Horse's licensing activities also enjoyed strong growth with revenues up by 35% in 2008 and the figures from the 25 Ferrari Stores worldwide were very positive with overall revenues increasing by 16%. Ferrari also boosted its internet and www.ferrari.com activities in 2008. E-commerce grew by over 65% while a series of special events, including the launch of the Ferrari California and the unveiling of the new F60 single-seater, drew millions of hits from all over the world.
During 2008, Ferrari continued its investment into new car development, setting aside the equivalent of 18% of the Company's revenues for R&D. Ferrari also continued with its investments in safety in the workplace in 2008. It spent in excess of 4 million euro on structural work and specialist training, achieving major improvements in all areas of the company. Particularly significant in this process was the new "near-misses" alert system which actively involved company's employees. Defibrillators were also installed throughout the Ferrari complex.
2008 also saw the launch of an in-house energy production plan. A newly unveiled photovoltaic plant and a trigeneration plant due to be completed within the next few months, will mean that Ferrari will meet all of its own energy requirements within the
In terms of its workforce, as of December 31st 2008, Ferrari employed around 3,000 people, a little under half of whom are office staff.
Continuing its emphasis on people-focused activities, Ferrari also launched its Scuola dei Mestieri in 2008. This new programme is designed to provide training inside the plant which is not normally available outside Ferrari in specialist skills to allow our employees to enhance both their career prospects and professional development and improve their mobility within the company.
Ferrari also broadened the range of employee services in 2008. These now include special mortgage deals of up to 100% for first and second homes and renovations, banking facilities with very attractive conditions and discounts on school books for trainees and school children. There is also a preventative health plan featuring specialist visits, physicals for all employees and their children and free gym usage.