Ferrari makes some of the fastest cars on the road, but the luxury Italian automaker is taking the slow lane into an electric future as it tries to offset the pitfalls of technology against today’s powerful fossil fuel engines.
At an Investor Day this month, officials promised a new era in 2025 with the first fully electric Ferrari.
But for now, the noise remains the heart of what the combustion engine does. Unlike some rivals, Ferrari hasn’t provided a roadmap for going all-electric. The Volkswagen Bentley brand and Volvo are both targeting 2030.
According to a source familiar with Ferrari’s business plans, a new production line focused on electric vehicles (EVs) is expected to increase annual production at its plant in Maranello, Italy by more than 35 percent, from more than 15,000 cars by 2025 to 11,155 in 2021. That should help — or 65 cars per day versus 46 currently — providing higher profit margins in the process.
Ferrari declined to comment.
The carmaker has told investors that it is targeting a core profit (EBITDA) margin of 38-40 per cent in 2026, 35.9 per cent in 2021.
Its line-up could also grow from today’s 12 to at least 17 models by 2026. But most new models will, at least initially, have a combustion engine – including its first SUV, the Purosangu, which is powered by its trademark giant 12-cylinder engine – though some may be hybrids.
There are currently four plug-in hybrids in Ferrari’s line-up.
A zero-emissions future poses the same challenges for Ferrari as it does for rivals – EV batteries weighing hundreds of kilograms affect aerodynamics and handling, and largely the continued power and power of the combustion engine. Can’t match the roar of the throat.
To address those costly challenges, Ferrari is researching solid state batteries, which could theoretically improve battery power, as well as hydrogen fuel cells and synthetic fuels, both of which face an uncertain future. Is.
EU countries this week agreed to an effective ban on new fossil-fuel car sales, but will assess in 2026 whether hybrid vehicles and synthetic, or CO2-neutral, fuels can comply with that target.
“In every case where you have a technology transition, by definition you have a situation that’s a little vague, there’s some fog,” said Ferrari CEO Benedetto Vigna, a technology industry veteran who took over in September. told Reuters.
Jefferies analyst Philippe Houchois describes Ferrari’s outlook as “measured,” but says it may not be as popular with investors as some automakers charge for an electric future.
“They can keep their profit center with the combustion engine running longer and amortize their investment there,” he said. “But that’s not necessarily what the market wants to hear because the mindset is that let’s run in EVs and never look back.”
An electric marriage?
Every 22 minutes a finished engine and chassis come together on the V8 assembly line in Maranello, which Ferrari calls a “marriage”.
For an undisclosed amount, the engine with the V12 model includes a plate with the name of its maker written on it.
Ferrari executives highlight the sentiment that some drivers feel when they buy one of their cars, which starts at over 200,000 euros (about Rs 1,65,000 crore).
“I saw customers coming to pick up their cars and some of them are crying,” Vigna told Reuters.
That’s why it’s important for Ferrari to generate the same passionate response as its EVs.
Combining powerful engines with the quick acceleration of an electric motor, hybrid sports cars have been successful.
But fully electric sports cars currently have a weight problem because of the large battery needed to provide enough power. For example, Croat hypercar maker Rimac’s Navara weighs 2,200 kg, more than fossil-fueled sports cars and heavier than Ford Transit and Mercedes Sprinter vans.
This heavy weight “in turn affects performance, driving dynamics and feel”, said Dario Duce, managing director of consultancy firm AlixPartners.
Ferrari isn’t the only one facing these challenges, and some ultra-luxury rivals are racing to go electric.
For example, Lamborghini isn’t planning a fully electric car until the end of the decade.
But, according to AlixPartners Deuce, Ferrari should weigh its options more carefully than Lamborghini, which has a deep-pocketed owner in the world’s No. 2 carmaker, Volkswagen (VW).
“For Ferrari, which unlike Lamborghini doesn’t have access to a development platform like VW, the issue of investment is certainly relevant as well,” said Deuce.
Hydrogen to the rescue?
Among its options, Ferrari is researching hydrogen fuel cells, a futuristic zero-emissions solution by carmakers in Japan and the likes of BMW in Europe that can match the sustained power of combustion engines.
British startup Viritech is already building a hydrogen hypercar, with input from Italian auto design house Pininfarina, a limited-edition vehicle weighing 1,000 kilograms it aims to use to sell the technology to car makers.
CEO Timothy Lyons says that Viritech has seen a “massive increase in interest” from traditional carmakers in the concept over the past 18 months.
But hydrogen fuel cell cars require infrastructure to produce “green” hydrogen using renewable energy and fuel stations, which is unlikely to happen until the 2030s.
Vigna said Ferrari is working on battery components with four partners in Europe and Asia to research the next generation of high-energy density solid state batteries, which are lighter than today’s cells.
Carmakers such as Ford and BMW have invested in solid state batteries, but the technology is still a few years away from use in cars.
“Solid state batteries are changing a little bit like the hydrogen story, in that it is the fuel of the future,” said Jefferies Houchois.
He warned that Ferrari’s slow pace of change could be seen as dragging its feet or “socially wrong”.
“But from a business standpoint, they have a good business and it doesn’t need to go away quickly,” he said.
“They’re avoiding excessive commitments that they can reach a certain point by a certain date at a certain price because they don’t know.”