70 years young: Ferrari still finding top gear

Today, the eponymous founder’s cars have gone far beyond the borders of its base in the small northern Italian town near Modena. They roam the roads of the world’s most influential cities as every man’s dream possession; synonymous with speed, wealth and prestige.

The prancing horse is considered one of the most powerful and expensive cars to own, with its open-top LaFerrari Aperta boasting a maximum speed of over 350 kilometres per hour and an undisclosed price tag.

It is in Dubai where we spot the limited edition Aperta – one of just 210 produced – showcased in the brand’s showroom on Sheikh Zayed Road in celebration of the 70th anniversary, and one of five new cars inspired by 70 of Ferrari’s best heritage cars, released to mark the occasion.

We are told it is the only time we will see the Aperta showcased in Dubai. But judging by UAE sales figures, it would not be a surprise to spot it on the UAE’s roads. Ferrari sales in the country constitute 40 percent of overall Middle East sales, according to the company’s Far and Middle East CEO Dieter Knechtel.

“The UAE is by far the strongest market for us in the Middle East. Traditionally, it’s always been like this,” he says when we meet at the showroom to discuss Ferrari’s anniversary plans for this region.

The $21.44bn firm saw “enormous response” from UAE buyers for Ferrari’s first ever rear-wheel steering, four-wheel drive vehicle, the GTC4Lusso, released in the region last year, with Knechtel claiming the model is currently oversold.

According to the CEO, the GCC is a strong market for the brand’s 12 cylinder models, compared to other regions around the world, with Saudi Arabia standing as the second largest market for the model and for Ferrari in the region.

In fact, the company opened its largest ever showroom in Riyadh just this month.

“It’s a good sign that our partner is confident in the future of Ferrari in Saudi Arabia. Despite the difficulties in the region, business sentiment is looking very positive in the next five years,” says Knechtel of the launch.

Tough times, fast cars

More generally, Ferrari is bucking the trend of a weaker global economy – world growth last year only just scraped over three percent – with Ferrari’s V12 sales rising 36 percent in the second quarter of 2017 compared to the same period last year. The rise was largely led by the GTC4 Lusso, which retails for a base price of around $350,000 and LaFerrari Aperta, according to the firm’s annual report.

Knechtel thinks the brand’s current product range, including the (relatively) entry-level California has also managed to attract younger customers than the traditional Ferrari buyers, who are believed to be in their forties.

“I believe we have managed to attract younger clients with our GT models, especially the California, which was a big success globally,” he says. “In the Middle East, we have also started to make a difference with the California T [priced around $232,000], because it’s a model we haven’t seen before. It’s a product offer we haven’t seen before in this region, which eventually allowed us to attract younger buyers in their thirties as well as young families with models such as the GTC4 Lusso.

“It attracted people who would like to use the car on an everyday driving basis. We have seen that already for the FF, which has a target market at least ten years younger than that of the previous model, Ferrari 612,” he adds.

Figures back Knechtel’s claims of a good year for Ferrari, with the firm’s overall net revenues having increased by 13.5 percent in the second quarter of 2017 to $1.1bn, compared to the same period last year. Shipments also went up 5.3 percent, totalling 2,332 units. Furthermore, the brand’s 812 Superfast is yet to arrive on the market, but has already garnered a waiting list beyond 2018, the CEO claims.

Knechtel says Ferrari has no plans to develop a hybrid car for the purpose of saving fuel.

However, the carmaker’s Middle East sales saw a decrease in the number of cars sold in the first half of 2017 compared to the first half of 2016. The CEO says times are “not as easy as they used to be” in the Middle East, and Ferrari cited tough market conditions as the reason behind the drop. But the firm is hopeful that its new products will push sales in the region as well as abroad.

These models include the newly launched Portofino, replacing the California T as the brand’s new entry-level car, priced somewhere above $200,000, and featuring a V8 engine with a top speed of 320kmh. It is said to be 80kg lighter than its predecessor, following through Ferrari’s weight-saving policy.

“With the new models that we launched, such as the Portofino, we are able to reach out to new customers,” says Knechtel.

“I assume the first car will be in the region by the beginning of Q2 next year. We have a lot of plans with this car because it has been refining a lot of the things that some clients for the California appreciate so much. The car has become very sporty and masculine. I think that attracts a lot of people in the region.”

Knechtel describes the new model’s performance as a “dramatic upgrade” compared to the previous version, adding that “there is a lot of hope and expectations” riding on its success.

He runs through a list of other new models that will widen Ferrari’s scope for new customers. The 812 Superfast, priced around $315,000, has the most powerful naturally aspirated production car engine ever made, with a top speed of over 355 kmh, and is due this October, with demonstration cars here already.

“We always promise there is at least one new model per year to be launched in the market; recently we ran on an average of two. So you can expect a lot of good things to happen with Ferrari in the future.”

Red not green

What the eponymous Italian brand will not be reverting to, under any circumstance, is fully electric or autonomous cars, Knechtel insists. “I think [they] are even less fitting with the brand [than SUVs]. To be honest with you, I don’t see any client who would like to have a self-driving, autonomous Ferrari. Electrification is very important for us, but there will not be any 100 percent electric car coming from Ferrari.”

He says the company is instead looking at full electrification with hybrid technology.

“That is something we are working on right now. There is a lot of research going into it. You will see hybrid cars from Ferrari across all ranges in the future, I assume. In a couple of years we will probably launch the first one out of the normal range with a hybrid engine.

“But what is important to mention here is we want to apply the Ferrari approach when using hybrid technology.

“When you look at the V8 that we launched for the 488 Spider, it has the best turbo engine in the market because we managed to produce it with no turbo lag. It is forbidden for Ferrari to have turbo lag. When we talk about the hybrid engine, the same thing applies. We would like to have our own hybrid approach.”

Ferrari is no trend-follower, he says, adding that the company would not develop a hybrid solely for the purpose of saving fuel. “It’s good to save fuel, but for us it’s more important to boost performance. We want to be the highest performing car. We have always promised to be so and we want to keep our promise,” he says.

F1 shop window

Will Ferrari be the best performing car at the upcoming Abu Dhabi Grand Prix? Knechtel thinks so. “We don’t know the future of Formula One, but right now I can say that we still have high expectations about this season. We have managed to catch up a lot from the past. Now we are competing at the top again. This year, we have yet to see what happens. We still have six races to go,” he says.

But the challenge for Ferrari in terms of Formula One does not solely come down to winning. According to Knechtel, the races appear to have lost some of their competitive appeal.

“With Formula One, unfortunately, some of the traditional teams are not so strong, which results in the effect that it’s basically a match between Mercedes and us. So I hope that the other teams compete at the top again to make it a bit more interesting,” he says.

He is not the only one to think so. Last year, ex-Formula One boss Flavio Briatore told Arabian Business he found the races “too boring” and more of an exercise for engineers. “There’s no glamour,” he said.

“When you see the engineers on TV explaining an amazing clutch, nobody cares. People care about the driver, the star. Now, to be quick, you need the bank to finance you. And everything is critical. If you touch the white line, you are punished. If you don’t have the right engine, you are punished. It’s a punishing business.

He added: “People don’t find it interesting. It’s missing the gladiator factor. The drivers need to fight. You need to have a rivalry between drivers: between Senna and Prost, between Mansell and Schumacher. This is what people want to see. I miss the old Formula One.”

Knechtel does not necessarily agree that the races are boring, but concedes change is needed. “I know a lot of people who are very passionate about Formula One, but so many people have walked away from [the races] because there’s an overflow of information. It’s also easy to watch it on TV nowadays. Before, people used to go all the way to watch the races. Now, I think the responsibility would be to further work on bringing Formula One a little bit closer to the people instead of the other way around.

He mentions other ideas to revive excitement in the sport, including races in attractive cities,” he says. “There was a show in London recently. So it could be there, or maybe New York or Miami. This could take the appeal a bit further, apart from the cars.”

As we wrap up our conversation, Knechtel approaches the red Aperta displayed in celebration of Ferrari’s 70th anniversary. “It’s beautiful, isn’t it?” he asks. While it can be argued that Formula One has become less attractive, it is unlikely Ferrari will lose its timeless appeal anytime soon.