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Fiat AND Ferrari lose money

Discussion in 'Ferrari Discussion (not model specific)' started by tifosi, Jul 26, 2004.

  1. tifosi

    tifosi F1 Veteran
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    Sep 5, 2001
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    Tom D
    looks like maserati is having a drain - ferrari lost money due to what they called maserati research costs :)
     
  2. Lukas

    Lukas Formula Junior

    Dec 28, 2003
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    Lukas A. Niklasson
    ugh...lamborghini...ugh ;)
     
  3. Fiat Dino 206

    Fiat Dino 206 Karting

    Apr 19, 2004
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    David
    That ain't all of it ... The Euro's strength and the dollars weakness in world markets is reducing the margins on all of the vehicles sold by Ferrari/Maserati in the United States, its largest single market.

    Repair and replacement parts are already on the rise when paid for in dollars. The "rumor mill" is that if the weakness of the dollar continues, we may be faced with rising MSRP here in the States in the not too distant future.

    Best wishes
     
  4. wax

    wax Four Time F1 World Champ
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    Jul 20, 2003
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    Dirty Harry
    http://www.bday.co.za/bday/content/direct/1,3523,1667343-6078-0,00.html
    More accurate appraisal of who, what... oddly, doesn't mention euro/dollar discrepancy, which played an enormous role because of relatively imbalanced U.S. portion of Ferrari/Maserati sales in comparison with worldwide base.

    "Sales at the sports car unit Ferrari shot up 17.4% to 399 million euros, thanks largely to sales of its Maserati model.

    But Ferrari's operating loss widened to 12.0 million euros from seven million in response to higher research and development costs, Fiat said."
     
  5. Doody

    Doody F1 Veteran

    Nov 16, 2001
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    Mr. Doody
    geez - 12 -vs- 400 - that could just as easily be attributed to currency issues.

    interesting.

    doody.
     
  6. tifosi

    tifosi F1 Veteran
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    sales rise but losses are produced - this happens when you have to put incentives on the car - now you say masers don't have incentives???? yeah right, try that nice warranty they give you - its costing them a fortune and they have to record the hit for it up front with the sale. R&D :)
     
  7. ze_shark

    ze_shark Formula 3

    Jul 13, 2003
    1,273
    Switzerland (NW)
    Not necessarily, you're mixing up gross margins with operating expenses ...
    I have never seen gross margins published by Fiat Group for Ferrari-Maserati, so that's a quick and risky assumption.
    I would be surprised if, in the current context of corporate governance scrutiny, Fiat's bean counters would risk giving misleading information to investors. If they say OPEX, that must be OPEX ...
    Surprising to read that the Scag 2004 production is already sold.

    The official release is here: http://www.fiatgroup.com/comuni/php/file_get.php?w=PMKCRLCHLSX6Y5A66CRE

    Ferrari – Maserati The Sector had revenues of 399 million euros in the second quarter of 2004. The increase of 17.4% over the same period last year reflects strong demand for Ferrari randed cars (unit sales up 14%) and rising shipments of Maserati models (+52%), which were buoyed by the success of the Quattroporte. The appreciation of the euro versus the U.S. dollar (negative currency translation difference of about 15 million euros) and a sharp increase in R&D expenditures for new Maserati models are the main reasons for the operating loss of 12 million euros. The order backlog is very strong, particularly for the Ferrari 612 Scaglietti and the Maserati Quattroporte, with orders already covering their entire 2004 production run.
     
  8. tifosi

    tifosi F1 Veteran
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    I could be wrong but I think sharp increase in R&D means - warranty - both operating items
     
  9. Fiat Dino 206

    Fiat Dino 206 Karting

    Apr 19, 2004
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    David
    This is one recent article regarding internation exchange rates etc.

    http://www.ferrariownersclub.co.uk/happenings/2004/january/ft_article.asp

    I have been hearing for several months that there is a discussion regarding what to do about the "hit" being taken by profits over the long run and what to do about it by managers in several of Europe's car makers ... The whole thing is a bit complicated.
     
  10. Auraraptor

    Auraraptor F1 World Champ
    Lifetime Rossa Owner

    Sep 25, 2002
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    MSRP on parts is up notably over the last 2 years.
     
  11. ze_shark

    ze_shark Formula 3

    Jul 13, 2003
    1,273
    Switzerland (NW)
    Any certified accountant around ? I believe that under GAAP (Gruppop Fiat has ADRs traded on NYSE), warranty costs would have to fall under COGS ?
     
  12. BJS

    BJS Formula Junior

    Jan 18, 2004
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    Brad Stephenson
    I'm not a GAAP guy, but I agree that warranty costs would likely be counted as COGS.

    Since Maserati hasn't yet released the Quattroporte, all of the associated costs shoiuld be going into the R&D line. Add the costs related to a complete makeover of the Coupe and Spyder for 2006, then throw in a few million for the Gran Sport, MC-12, Trofeo models, et., and you have a pretty large sum for a niche manufacturer.

    Who knows, they may even be using Maser's R&D books for the conversion of the 4200 powerplant into the 4300 flat-crank version for the upcoming 360 replacement.

    Pretty hard to tell from a distance. That's why analysts ask questions during earnings announcement calls, but those details would probably get lost in a discussion of Fiat's overall business problems. :)
     

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