Ferrari CEO Benedetto Vigna Talks Earnings & Ferrari's First All-Electric Car

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Ferrari unveiling a sleeve of news strategies and financial targets in its capital markets day last week. Now the more cautious than expected outlook it sparked the stock's biggest inter day drop in ninety years, which overshadowed the launch of the luxury automaker's first ever electric vehicle. Pleased to say that we're joined live in studio now by Ferrari CEO Benedetto Vinya. Great to see you in person.

Like Wise, good afternoon, So let's.

Talk a little bit more about what exactly you said last week. It was the guidance for revenue growth and profit if you map it out to twenty thirty. I believe that that only targets about five percent annual growth. So is that Ferrari being cautious prudently here or do you actually see something troubling ahead when it comes to the luxury market.

I think that the plan we shared last week is equen Mbishu says the last one. I think that the three years ago committed to delivers and we delivered it. On our promises, we are committing and we will deliver on our promises.

So the confidence over there.

We want to address this market, this strategic view with the same greeted determination as we as we did before.

So now setting the barlow to then stretch.

I don't think.

I don't think, I mean one gentleman in the capital market. They asked me if the plan was equally ambitious or not, and I believe this plan is ambitious.

Equally ambitious.

Michael Dean from Bloomberg Intelligence was there. He said he had a fantastic time, so well done, thank you, But he did say he expected more in terms of free cash flow. You have eight billion euros penciled in over five years. He's looking for nine sharehold returns. You have roughly seven billion euros between split between dividends and buybacks. He said he was disappointed by that as well. Why do you think investors or analysts the street is expecting more from you?

Maybe they are expecting they believe that we don't care too much about cashaday. I think for us, as Catcity is important, it is embedded in our business model. We want to make sure that this cashaday is always kept over there. I like to say that this is not one hundred meter sprint this is a marathon, and we have to make sure that we do not alienate our client, because if the client is appy, the investor is app that other way around may not work.

I think he's expecting more in terms of margins. He I talk to him all the time, and he says, like the margins on something like the Icona or the F eighty are just jaw dropping. He's looking for more like forty three, forty four, forty five percent. And you did forecast more than forty percent.

We said two figs more than forty yea and more than thirty idiot, right, yeah, and I think we did. We did those visibility for six years. I don't know many companies are giving visibility for so long nowadays.

Are you going to be selling more of these iconas?

These are the special incredibly high ice tag vehicles. I heard, for example, that you can order one with a gated shifter, which got me very excited. Next time I came up at four million dollars, I'll put it in my order. But are you going to sell more of those in the mix along with the F eighty.

I think that we have all is to make sure that the Icona, it is super care Limited. There was a clear message, from a clear chart from our CFO that was telling that a number of Iicona supercars will not go more than five percent, and we want to stick to it. I think that to have our client happy, he has to feel that you own something that not only not too many people can have it. And I

This is important.

I do want to go back a little bit too last week and the Capital Markets Day, because it was a two parter, right, you unveiled your financial targets, but you also were showcasing the Electrica your first, of course EV and it's the opinion of Bloomberg Intelligence that really was the EV technology that was overshadowed by the financial targets, that those ultimately ended up being the focus. And in hindsight, would you maybe have separated those two announcements.

I know this is a feeling of Bloomberg, but I have to say that I had a lot of other comments positive in this direction. They said, it's good that you show to the community that what you said the three years before it was happening, because three years before, we said we want to show you that we are on target. We're going to unveil the Electrica ferrar Electrica, and.

We did so.

I think that I fully respect this point of view and this consideration, but I think it was important for to reason number one, to show that we were on track and we deliver on our promises. Number two, that we had to show to all the people over there for the Capita maca day, to show the beauty of our new.

And to be fair to the Bloomberg newsroom. I mean, the shares did drop by the most since twenty sixteen, so I don't know. Maybe some of the Wall Street analysts shared that view as well. But I do want to talk a little bit more directly about Electric Ferraris because you lowered your targets to twenty percent of the lineup by twenty thirty. Previously it had been forty percent. We'd love to hear a little bit more about that decision to lower the target.

I figure that would drive the shares higher. You know, you're making more combustion engines than we expected. That's what we want from a Ferrari.

H Matt, But look, I think it's important last time is this time we said something important. This is not a split of ourselves. This is split of our offer because at the end of the story, it's the client. This is going to select if you want to drive Ice, Iybrid or Electrica. So it's up to him or to hers to select the reason why we drop or we reduce, we trim it down. The split of the twenty percent of the offer is because we have seen what is

Terminal.

I see, when are we going to see the body and why? And when are we going to hear it? Because apparently it's going to be amplified in.

VI in H one next year we do we keep delivering on our promises phase one, then phase two is going to be let's say, in Q one phase two in Q two we in Q two.

Can I talk about something that you probably are sick of hearing it from me?

But analog versus digital?

Right, you're putting buttons back on the steering wheel in the Amalfi, which I'm very not so that's fantastic. I imagine customers asked for that right, You've still got you know, uh, fields of screens in there. And I've driven a number of very expensive cars where they have screens replacing these elegant and beautiful analog gauges. You know, why don't we go back to clocks that are.

An animal with with you know, needles.

Wouldn't that be more exciting for a Ferrari buyer.

Look, we said clearly that we are a big fun of digital. It means that you use digital way it's needed, in physical where it's needed. I can't tell you that all the time. This year we presented the five cars, the two speech Ale six cylinder, the two Test Rossa

Can I just ask about the shifters? Because I spend so much time on bring a trailer. I'm looking at three sixties, I'm looking at four thirties, you know, sometimes five seventy fives and six twelves. And I noticed that the premium for a manual is massive, fifty sixty seventy percent, sometimes even double for the manual.

Car versus the autobox.

So doesn't that mean customers want to buy that new two?

Look, you have to listen to client for something for something else, don't you cannot listen for something else?

Maybe some good in for the future.

So maybe in the future you can just make a suggestion box and Mac can put his comments directly on their book.

Used to come to see us? There you go before really ago, I do.

Want to talk a little bit about China because you take a look at some of your peers in Porsche, BMW, Mercedes on a slightly different price point there, but they're rapidly losing market share when it comes to China, and I wonder you know, when you look at that, are you confident that you're going to be able to buck the trend there?

Since the beginning, since I joined the company, we said that for us, China is I mean Maline China, Taiwani onng Kong will be bebow ten percent.

That's what we said.

Recently, I think that last year Ferrari did not have an offer that was fitting well the Chinese market because we were having Aditor cylinders and we had a Roba Spider with softat is not so welcome.

And now we are going to change. We are rich.

Let me see, the offer for the for China Electrica could be also a good interesting car for them, because you will not have all the taxes that you have on IC Well.

It could be a product that they embrace, maybe more than other parts.

It's great having you here. Thank you so much for joining us.

Thank you.

Benedetto Vinya, the CEO of Ferrari