Ferrari Is Witnessing The Worst Day In Its History!.. What Is The Story?

The company’s stock fell by 16% to $77 billion, its worst trading performance ever.

This sharp decline came after the Italian luxury company announced its new five-year plan and the details of the Ferrari Electrica electric model, which raised Wall Street’s reservations and investors’ concern.

Ferrari faces great doubts about its ability to maintain the identity of the brand known for its loud engines and elegant designs, especially with the failure to reveal an official image of the new electric car, whose price exceeds 300 thousand dollars.

Insiders say that the electric car is similar in design to the four-wheel drive “Borosang” car, more than it resembles the brand’s traditional sports cars.

In an effort to maintain the “excitement” that characterizes Ferrari cars, CEO Benedetto Vigna promised a new technology that picks up vibrations from the drive system and amplifies them in the cabin to simulate the traditional driving experience.

The electric car is scheduled to reach the market in late 2026, with the official unveiling of its design next spring.

The car will rely on a new propulsion system and chassis, and will be made of 75% recycled aluminum, including the production of key components such as batteries and software internally, as part of Ferrari’s efforts to reduce emissions and control costs.

The company’s new five-year plan includes a noticeable change in strategy, as Ferrari reduced its expectations for fully electric production to only 20% of total production by 2030, while allocating 40% to traditional engines and 40% to hybrid cars. This represents a significant decline from 2022 expectations, which indicated that 40% of production would be completely electric.

The company also announced its goal to launch four new models annually on average, with a focus on diversifying the models and reducing the production numbers of each.

In terms of financial performance, Ferrari expects to achieve revenues of $8.2 billion this year and $10.4 billion by 2030, which are numbers that exceed previous expectations but are still much lower than the long-term expectations that it had previously announced.

These plans were not welcomed by analysts, as analyst Harald Hendricks described them as “disappointing” and “extremely cautious,” while others saw that the launch of Ferrari’s first electric car lacks the ingenuity usual in its traditional products.

It is noteworthy that Ferrari has been working on electrification technologies for 15 years, starting with Formula 1 technologies that were used in the limited-production La Ferrari hybrid car in 2013.

The CEO believes that this new model will attract new buyers to the brand, in an attempt to keep pace with the requirements of the future without completely abandoning the company’s rich heritage.

Source: Daily Mail