Everyone is needed, but no one is indispensable… These are the words of Fiat Chrysler CEO Sergio Marchionne, describing, now former, Ferrari President Luca di Montezemolo.
Luca Cordero di Montezemolo has annouced that he is stepping down as chairman of Ferrari after 23 years at the company
Montezemolo turned Ferrari around after the death of Enzo Ferrari when it was questionable if the company would survive. Ferrari now generates 10x the revenue it did just 30 years ago. In an age where companies believe more is more, Ferrari stuck by and was successful at the less is more model through limited production (7000 units last year) and brand loyalty that is unsurpassed. Montezemolo also turned around Ferrari's racing heritage and brought together the team of Schumacher Brawn and Todt that gave Ferrari five consecutive F1 drivers titles and 6 constructors titles.
He resented temptation to follow the lead of so many other automakers to dilute the brand with entry level models, SUVs, or hatch-backs. Ferrari has always been about one thing…passion.
At this week's Ferrari Board meeting Montezemolo was expected to announce the largest ever profit for the company.
Axis of Oversteer Blog makes this argument:
Marchionne has brought in "american style" management and the new group will go public in New York October of this year. FIAT still has not built a decent car of note except the 500 so the prestige of Ferrari is key for success on the stock market along with Maserati and Alfa Romeo. Some say Marchionne wants an American to head the prancing horse, some say he will step in himself. For sure the plan is to expand production.
The struggles of Ferrari in the pinnacle of motorsport, Formula 1 would seem to leave anyone at risk with the dismal performance of the Scuderia. This past weekend in front of the home crowd in Monza Ferrari only managed to score a single point. Though the struggles for a brand built on racing are series the Montezemolo exit appears to be more along the lines of a cultural shift within the company.
Some reporting reveals that Montezemolo may have miscalculated the connection between motorsports and sales. He implied last week that Ferrari' success was not necessarily tied to F1,
Mr. Montezemolo said on Wednesday that recent poor results on the racetrack haven't affected Ferrari's bottom line. "They aren't connected," he said in response to a question at the news conference, noting that Ferrari's biggest market is the U.S. where Formula One is a niche sport
For a brand that has always been so focused on motorsport this comment along demonstrates that perhaps it was time to step down.
The Wall Street Journal Reports:
Sergio Marchionne, chief executive of Fiat SpA, which owns 90% of Ferrari, will take over from Mr. Montezemolo, 67, whose departure is effective Oct. 13—the same day that Fiat Chrysler Automobiles, a new company created out of a corporate reorganization, is slated to make its debut on the New York Stock Exchange.
Ferrari has long been the jewel in Fiat's crown and Mr. Marchionne has so far resisted calls for him to sell a stake in the luxury brand to raise cash that could be used to realizeFiat's ambitious €48 billion ($62 billion) five-year plan, presented in May.
Mr. Marchionne, speaking at a news conference at Ferrari's museum in Maranello on Wednesday, excluded an initial public offering for Ferrari in the near term, though he said that the final decision stood with Fiat's board.
While it is not yet clear what Mr. Marchionne plans to change at Ferrari, there is unlikely to be a significant shift in strategy—specifically the company's decision to cap production at about 7,000 vehicles a year to maintain exclusivity, according to analysts.
Mr. Marchionne, who in May said Ferrari production could be boosted to 10,000 cars a year without hurting the brand, left open the possibility of that increase being eased in over time.
"An important cycle at the company has ended and another one is opening that I hope will be even more important than the last one," Mr. Montezemolo said at the news conference, where he made jokes, was occasionally teary eyed and thanked many people—including the former Ferrari driver Michael Schumacher who returned home yesterday after more than eight months in hospital following a skiing accident.
Mr. Montezemolo said that his wife looked forward to him being less stressed on Saturdays and Sundays, when the Formula One races take place, and that he is happy that he will now have the time to pick up his young son from school.