Ferrari Scales Back Electric Ambitions Amid Share Decline
"Yes. So, they have scaled back their electric ambitions essentially. So, they now expect only 20% of their 2030 lineup is going to be fully electric. That's half of what they previously expected. They had expected 40%. And essentially they're filling that gap with their fully uh their combustion cars. So that will now be 40%. So they're doubling their combustion offerings. Essentially showing kind of a renewed focus on engines and that has obviously defined Ferrari for decades. So they're kind of going back to their core following a lot of other car makers that have also pulled back from from electric ambitions. It's it's obviously very expensive. Uh there's been kind of a failure to get enough customers. Um, so Ferrari shares are are dropping almost 2% this morning. Um, we'll be keeping a close eye on them though throughout the morning cuz they're they they've got a couple markets day and they're planning to announce their financial targets."
In the segment on Ferrari, the speaker details a strategic shift where Ferrari is reducing its electric ambitions in favor of its traditional combustion models, now expecting only 20% of its 2030 lineup to be electric. This strategic pivot, combined with a noted share drop of almost 2% and challenges in customer acquisition, presents near-term uncertainty for the stock.
Ferrari (RACE) Investment Commentary
""Ferrari is synonymous with wealth and luxury. No other automaker can demand a premium quite like Ferrari can. The brand reputation is unmatched, even though the company faces challenges in the U.S. market and with its EV strategy. The financials look strong, with high revenue and profit growth as well as a robust balance sheet. Based on the current valuation, I expect around 10% returns over the next five years, with some caution due to premium pricing and macro cyclical risks.""
The speakers provided a detailed assessment of Ferrari (RACE), emphasizing the unparalleled brand strength, solid financial performance, and strong global presence. While they note some concerns in the U.S. market adoption and the evolving EV strategy, the overall commentary is positive with an expected 10% return over the next five years. The cautious yet optimistic tone highlights Ferrari as a resilient, premium stock suitable for long-term investors.