Ferrari Mailing List: Re: Yes, People Buy Ferraris in a Recession [Today's WSJ]

[Erik Nielsen (judge4re]

Damn it!

Now Obama is going to think that us shitbox driving Mondial and GT4
owners really are rich...

On 3/31/09, Larry B <larrybard [at] hotmail.com> wrote:
>
> Yes, People Buy Ferraris in a Recession
>
> By JOSEPH B. WHITE
>
>
> This is a tough time for the very wealthy. Stocks are seesawing. The credit
> markets are as liquid as a frozen daiquiri. Rage against big Wall Street
> bonuses has lately taken up much space on Washington's political menu, right
> alongside proposals to collect more taxes on the top 1% of the American
> income pyramid.
>
> Despite all this, the makers of ultra-luxury cars -- vehicles priced above
> $100,000 -- still believe in the American dream. Sure, they have hunkered
> down and cut production, and some have scaled back certain marketing
> activities, such as displaying cars at big auto shows. But they aren't
> giving up on the U.S. market, and, indeed, some see reasons to be optimistic
> that a recovery in demand could come sooner than some expect.
>
> "Even within the last few weeks, we have seen the optimism of spring," says
> Marti Eulberg, president of Maserati SpA's North American sales arm. "We are
> starting to see that in the showrooms." Maserati won't have a display at the
> New York Auto Show next week. But it will invite potential buyers to see its
> newest model, the Quattroporte GranTurismo S, at its Park Avenue showroom.
>
> Bentley, one of the super-luxury brands owned by Volkswagen AG, plans to
> roll out four new models by the end of this year: A GTC Speed, the Azure T,
> a flex-fuel model called the Continental SuperSports and a "Final Series"
> version of its big, top-of-the-line sedan, the Arnage. The SuperSports,
> designed to run on either gasoline or biofuels, will be on view at the New
> York Auto Show.
>
> The flex-fuel Bentley is a nod to the possibility that in the future, an
> important slice of individuals with the means to buy super-luxury cars will
> want those cars to be green. Tesla Motors Ltd., which sells a $100,000
> electric roadster and last week unveiled a prototype for a $50,000-plus
> electric sedan, and Fisker Automotive, which is soliciting deposits for its
> hybrid-electric Karma sports car, are pushing hard to break the segment's
> old formula: that super-sized prices needed to be justified by super-sized
> horsepower.
>
> Bentley just opened a new dealership in Austin, Texas, and Christophe
> George, Bentley's chief operating officer in North America, was out in Napa
> Valley last week launching the GTC Speed, a 600-horsepower, 12-cylinder
> convertible.
>
> Mr. George isn't giddy about the current market. Bentley sales last year
> were down 24% world-wide, and off 32% in the U.S. He says it's too early to
> make a forecast for this year. But long term, he says, "the potential for
> sales is there."
>
> "Millions of people have more than $30 million in net worth" world-wide, Mr.
> George says. What's lacking now isn't the means to buy a Bentley Continental
> GT, which goes for about $200,000 new, he says. "What we are currently
> lacking is confidence in the marketplace."
>
> At Ferrari SpA, North American chief Maurizio Parlato says the company is
> taking a "conservative approach" to the current year, and emphasizing
> Ferrari's value as an investment-grade product. "Our cars keep their value,"
> he says. "You put money in the market, and you have no money."
>
> Ferrari is launching a new model, the California, in June. A limited-edition
> model called the Scuderia Spider 16M is already sold out, Mr. Parlato says.
> Ferrari plans to build only 499 of the 510hp Scuderia convertibles. If you
> Google the car, you'll see it has attracted more than one million searches.
> Mr. Parlato says Ferrari is flying some of the cars to eager buyers.
>
> The super-luxury car market doesn't operate by the same rules as the mass
> market, of course. All together, brands such as Maserati, Ferrari,
> Lamborghini and Bentley sell in a year what Ford Motor Co. or Toyota Motor
> Corp. dealers sell during one or two bad days. Mass-market brands talk about
> building relationships with customers. The senior executives of ultra-luxury
> brands know the names of many customers.
>
> Ms. Eulberg looks at the paperwork for Maserati deals so she can get a
> detailed understanding of who her customers are and how they are paying for
> their cars. At Maserati's sales volumes, she can do that.
>
> Worried or not, makers of ultra-expensive cars are starting to pay more
> attention to bread-and-butter issues, such as marketing pre-owned vehicles
> that need to be resold.
>
> At Bentley, Mr. George says his organization has begun offering warranties
> and other programs to help its dealers sell second-hand Bentleys. "This
> pre-owned market is quite new to us," he says. The Continental GT -- which
> drove Bentley's U.S. sales from a mere 412 in 2003 to a peak of 3,990 in
> 2007 -- was launched in 2004, so there are still relatively few second-hand
> ones hitting the market.
>
> For Ferrari, one benefit of the downturn has been to shrink the waiting
> lists that Mr. Parlato and his staff once had to manage. "Now we have people
> who want to own a Ferrari," he says, not people who want to snag one and
> flip it for profit to someone behind them on the list.
>
> Mr. Parlato says he's not too worried about the attacks on Wall Street
> bonuses and the troubles in the financial industry. "Our customer base is
> not mainly those people," he says. "Those people are quick buyers" who favor
> other brands that don't require a waiting list.
>
> "Our people," Mr. Parlato says, "have serious money."
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