Ferrari’s (NYSE:RACE) ‘Icona’ Project Focused Boosting Profit Margins

Ferrari’s (NYSE:RACE) ‘Icona’ Project Focused Boosting Profit Margins

Ferrari’s (NYSE:RACE) ‘Icona’ Project Focused Boosting Profit Margins


Ferrari (NYSE:RACE) is set to unveil a Special Edition Supercar that will form an integral part of CEO Louis Camilleri’s highly-anticipated 5-year strategy plan.

The “Icona” project, hinted to customers last month in an invitation, will broaden Ferrari’s offering of Limited Edition Super and HyperSuper cars, a lineup that include multi-million dollar models, that are focused on boosting profit margins.

A spokesman for Ferrari declined to comment ahead of a capital markets day scheduled to get underway Tuesday at Ferrari’s HQ in Maranello, Italy.

Details of the new Supercar are not yet available.

Some expect Ferrari to premiere a model within a new range aimed at a larger demographic by focusing on characteristics other than extreme performance, we wait to see.

CEO Camilleri’s strategy for the iconic Italian carmaker will be closely watched by investors, especially whether he will stick with a goal of 2X’ing profit to $2.3-B by Y 2022, a plan put forward by his predecessor, Sergio Marchionne.

CEO Camilleri was picked for the job by John Elkann, the leader of The Agnelli Family that controls Ferrari and Fiat Chrysler Automobiles NV (NYSE:FCAU), during a dramatic July weekend as Mr. Marchionne’s health took a turn for the worse and he died unexpectedly.

Special Edition models earn higher margins, and could help CEO Camilleri to boost profit without losing the exclusivity of the brand.

Ferrari customers typically have to wait more than a year to get delivery of a new car.

Limited editions, like the $2.1-M LaFerrari Aperta convertible, are often highly-sought and go to the company’s most loyal customers.

Sergio Marchionne boosted Ferrari’s value by spinning it off from Fiat Chrysler and then 2X’ing profit in only years by raising production and introducing 1-off models.

The former Ferrari boss, who died on 25 July was preparing to expand the manufacturer beyond sport cars and introduce hybrid electric vehicles, including its 1st ever FUV. The FUV is not expected to be shown at Tuesday’s planned strategy presentation.

Ferrari is banking on CEO Camilleri getting up to speed quickly, as he has been a long time board member and colleague of Mr. Marchionne in the development of the Icona project.

Recall that Mr. Marchionne said in February that Ferrari planned to 2X its profit to $2.3-B within 5 years.

Mr. Elkann picked Mr. Camilleri as CEO while he took on Mr. Marchionne’s role as Chairman of Ferrari.

Symbol Last Trade Date Change Open High Low Volume
NYSE:RACE 133.27 17 September 2018 1.13 133.28 133.5 131.77 266,933
HeffX-LTN Analysis for RACE: Overall Short Intermediate Long
Neutral (0.08) Neutral (0.18) Bullish (0.35) Bearish (-0.31)

Stay tuned…

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