Ferrari Is Doing (Mostly) Fine (For Now)

Illustration for article titled Ferrari Is Doing (Mostly) Fine (For Now)
Photo: Ferrari

Coronavirus has meant near-catastrophe for almost every major carmaker in the world (and for a lot of minor ones, too) but the supercar market has fared a little better. Take Ferrari as the the latest example. The company said Monday that despite everything it still expected to make a decent profit in 2020.

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That projection is for over $1 billion in “core profit,” according to Reuters, having taken a hit on revenue from racing, but orders haven’t dropped substantially. Like virtually every other automaker in Europe, Ferrari was also forced to close its factories in Modena and Maranello, but those plants restarted today.

“Second quarter will be very weak,” Chief Executive Louis Camilleri told analysts, as the company said it now expected adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) this year to edge down from 2019 levels to 1.05-1.20 billion euros ($1.15-$1.31 billion).

In February, Ferrari had projected an increase in 2020 EBITDA to 1.38-1.43 billion euros.

“While the Formula One hit to revenues and earnings is not an easy matter to digest, the good news is that the significant losses incurred should be short-lived and contained to 2020,” Camilleri said.

The CEO said projections relied on Ferrari’s ability to retain a “very strong” order book, adding that as of now it had not received any “abnormal or untoward” cancellations.

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Ferrari also did something almost no other carmaker did in the first quarter: It actually saw its volumes rise.

And while there doesn’t seem to be a lot of good data out there about why supercar sales are decent (Bugatti also restarted production this week), I would guess that that is in large part because the super-rich weren’t touched by the pandemic early on, as these numbers only capture through March.

That dynamic might change (might have already changed), but if you’re the kind of person that has Ferrari money you’re probably still going to have Ferrari money even after a global pandemic.

News Editor at Jalopnik. 2008 Honda Fit Sport.

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DISCUSSION

Man, you seem to be one of the least knowledgeable in how richer people live. I really don’t want to come off as a bragging ass, but there’s always people who accuse you of having hard working parents who basically sacrificed their childhood for the ability to go to top notch schools and then get pretty insane wages right from the start. Most people who live a couple miles north of my neighborhood (there’s this place of several hundred mansions where a lot of the multi millionaires in north ATL live) can easily afford a $300K car, see: Ferrari. Most of them are guys who worked hard in school, were nerds throughout college, earned big bucks in their field, and then began investing/buying businesses. Here, a lot of them were especially lucky with their investments because the area has blown up in population with tons of people moving from NY, Chicago, and Cali.

Business owners are not doing well right now. Neither are investors. I wouldn’t be surprised if some of my friends (I’m in high school) won’t be going to my school next year because they need to find some housing which they can afford post-epidemic.

They sure as hell won’t be buying Ferraris.