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In a new factory in northern Italy, Ferrari chassis glide on robotized trucks while engineers in cherry-red uniforms add components like the engine block, dashboard, and steering wheel, transforming these bodies into hybrids. Soon: fully electric.
In Ferrari’s “e-building,” which cost 200 million euros and opened last month, a lot is at stake. Nearly twice the size of the Roman Colosseum, this factory aims to propel the 77-year-old sports car manufacturer, famous for the roar of its combustion engines, into the electrification era.
However, this effort comes at a delicate time for the car industry. The transition to electric vehicles, which should have quickly ushered in an era of climate-friendly transportation, has been slowed by costly investments and a global demand slowdown.
Other luxury car manufacturers have struggled to electrify. Mercedes-Benz and Lamborghini have scaled back their ambitions. Tesla reported a drop in second-quarter sales, and Ford Motor announced in April that it would shift production to more hybrids due to accumulated losses in electric vehicles. Furthermore, a growing trade war between China and the West threatens to stifle growth.
Despite the challenges, Ferrari sees an opportunity in the industry’s inevitable march toward electrification to attract a new consumer: the wealthy environmentalist. It plans to unveil its first fully electric model in the fourth quarter of next year. As part of its strategy, the automaker has enlisted LoveFrom, the agency founded by former Apple design chief Jony Ive and industrial designer Marc Newson, to refine the car’s look.
There is much mystery surrounding the as-yet-unnamed car, including its range and sound. The company has not revealed how it will look, how much it will cost, or how much it will cost. But it could be one of the most expensive electric vehicles on the market, surpassing Porsche’s $286,000 Taycan Turbo GT, according to analysts.
Ferrari’s foray into electric will be noteworthy for other reasons. Although regulators may push for electric vehicles, market skepticism persists. Winning over combustion engine enthusiasts will not be easy, even for Ferrari. And the industry desperately needs some automaker to prove that electric vehicles can generate significant profits.
“It’s worth seeing if an electric Ferrari can maintain the kind of premium you would associate with a Ferrari,” said Martino de Ambroggi, an auto analyst at Equita, an investment bank in Milan. “Often, buying a Ferrari is also seen as a kind of investment. Only after a few years will we see if that investment in an electric Ferrari holds up.”
Ferrari CEO Benedetto Vigna is doing everything possible to keep the market in suspense. In an interview last month at the new plant, he said the company would start mass production of electric vehicles in early 2026. By 2030, electric and hybrid cars will account for up to 80 percent of Ferrari’s annual production as the company seeks to meet the European Union’s stringent emissions mandates.
Meanwhile, the electric building will roll out two models: the SF90 Stradale, a plug-in hybrid, and the Purosangue with a combustion engine.
Ferrari does not need an electric vehicle to boost its profits. Under Vigna’s leadership, a former executive at chipmaker STMicroelectronics who took over nearly three years ago, the company has thrived. The stock is one of the best-performing in Europe this year, giving it a market valuation of about $75 billion, more than Ford or General Motors. Profits are rising along with prices at Ferrari, which makes some of the most expensive cars on the planet. There is a three-year waiting list for some models.
Ferrari’s success on the Formula 1 track over the years has also led to a lucrative business in corporate sponsorships and merchandising that has transformed it into a luxury brand with a sporty touch. Ferrari’s prancing horse logo can be found on high-end apparel like a 790-euro cashmere sweater.
Vigna sees the electric vehicle as part of the company’s growth strategy despite the industry slowdown. “There are some potential customers, I can see them, who will never become part of the family if there isn’t an electric car,” he said.
But challenges lie ahead. Enthusiasts gathered outside the factory gates last month wondered: Will it look, handle, and sound like the classic roaring Ferraris, or have the subtle whine of most electric vehicles?
“When you think of a Ferrari, you still have that feeling of the engine, and you also think of the roar,” de Ambroggi said. “I don’t know how Ferrari will solve that problem.”
Vigna gets this question often, especially from longtime customers, or Ferraristi. They seem to draw inspiration from the late founder, Enzo Ferrari, who once explained in simple terms how he built some of the fastest cars on the planet: “I build engines and attach wheels to them.”
Vigna’s argument for electric vehicles sounds different. “The electric engine will not be silent,” he said. “There are ways to ensure that the emotion you get from driving an electric Ferrari is the same as when you drive a hybrid or a combustion Ferrari.”
Battery life is another piece of the puzzle. Since Ferraris are often sold at a premium on the secondary market, concerns about battery degradation and its impact on the car’s long-term value may be more acute for Ferraristi.
“The transition to electric vehicles raises a lot of new questions in terms of vehicle maintenance,” said Stephen Reitman, an automotive analyst at Bernstein.
SK On, a South Korean battery maker and longtime Ferrari partner, will supply the components for the electric vehicles’ batteries, which Ferrari will assemble in the electric building, where it will also manufacture the car’s electric motors and axles.
And then there’s the issue of price. Last month, Reuters reported that the car would cost at least 500,000 euros ($540,000). Vigna dismissed the speculation, saying it was too early to talk about pricing.
Ferrari still adheres to its founder’s principle of producing a limited number of extremely expensive cars. Ferrari made fewer than 14,000 of them last year; even with the electric building, production is not expected to increase much at first.
The limited number of units may explain why fans make pilgrimages to Maranello, hoping to catch a glimpse of a Ferrari, whether on the company’s Formula 1 test track or near its red-brick factory.
Knowing that demand is high, Vigna has raised the base price of most models by more than 25 percent.
“Ferrari consistently sells less than what the market demands, leading to a backlog of orders of several years,” said Reitman, the Bernstein analyst. With a profit margin of nearly 30 percent, Ferrari’s business more closely resembles that of a luxury brand like Hermes or Rolex, analysts say.
Vigna is already thinking about how to market the new electric car. The target customer likely won’t buy the car for purely practical reasons or even to save the planet, he said, adding, “The emotional part of the brain is driving the purchase.”
Associated media – Associated media
