Is there a price Ferrari can NOT get away with charging?

Ferrari actually targets the "rich" as their clients. The upper middle class now buy them only because of credit for the most part. Up until the 308, most people paid cash for Ferraris.

 

It depends a bit on the competition and on the production.
Considering the Gallardo's performance, if they make as many 520s as they did with the 360, they're not gonna get away with it. Now if they plan to build 100 cars/year duing typically 5 years... some will see the collectible value in it ...

 

I don't think raw performance has much to do with it. If that were the case Ferrari, Porsche and Lambo would all be put out of business by the Z06 and even cars like the Evo and STi. No, these cars continue to sell because they offer more than just numbers. And with that said, Ferrari offers more of that "more" than the others.

As we all know, their history and allure are a big reason why they can get away will selling cars equal to their competitors for significantly higher MSRPs. This stuff doesn't matter to everybody, and those are the people who, "could have bought an F car, but didn't." I think it's safe to say most of us on this site do appreciate that those intangibles mean something, and that is what causes this obsession with the brand.

This wouldn't continue forever if Ferrari were to lose their way, but because they haven't rested on their laurels and have continued their success on the race track (pre 2005 ) and are making, arguably, their best street cars to date, the trend has no reason to stop.

The v8 cars continue to sell out and they could have easily sold another 400 Enzos. Unless something where to change drastically, this will continue, and will follow general inflationary trends towards higher pricing.

The last point has me thinking-- how much would yesterday's F-cars cost in today's money? If anyone has the time or the inclination, what would be the MSRP of a 328GTS today? What about a Dino? Etc. Has Ferrari followed general inflation, or have they moved up a notch? Or prehaps dropped down? Is that enough questions?

 

A $27,000, 1971 365 GTC/4 would cost in todays dollars: 128,000

 

Which is a little less than half the price of a well optioned 612. Very interesting....

 

Somewhere I read that Ferrari likes to price the V8 models at about the price of a starter home (not in SF). My 89 328 GTB had a sticker of 78,880. My 2005 430 had a sticker of 178,297 (stickshift coupe). Factor in inflation and the 430 is not much more. Factor in technology and the 430 looks like a bargain.

I think Porsche and Mercedes have both proven that the 400-500K level is a tough one. However, very limited production supercars like the Enzo are easy sells at 600K+.

Dave

 

Economics 101 again. Demand determines what price Ferrari can get. They probably left money on the table with the Enzo. OTOH, the 456 was wildly overpriced for demand. If a new 456 was $125k people may still be buying them and consider that car the best Ferrari value ever as opposed to a depriciation queen with no long term collectors's value.

I'm sure they have an eye on Lamborghini and want to define their niche; there is no Ferrari to compete with the Gallardo because Ferrari doesn't want to go that cheap. They leave that to Lambo. OTOH, Lamborghini has nothing in the upper end to compete with the Enzo, and also there is no real GT Lambo to compete with the 575 etc.

On the whole, these cars are very expensive toys and Ferrari wants to differentiate this small market as well as they can from the competition to maximize profits.

 

I think the answer is basically yes there is a limit obviously......but at what number is that limit reached is what will be the debate.

Who knows what that formula is ?.....too many variables to contend with IMHO......I'd say the market in general for 6 figure cars is much too fickle and subject to economic cycles more than most everything else......so ensuring a strong resale aftermarket is of more value corporately than seeing how high can one push the MSRP envelope.

And one does this by not trying to charge too much money in the first instance....so maybe it's good that they are not trying to find out the answer to what you are asking here. I for one could only speculate at what it might be.....recent after delivery resales would be the best place to start I guess.

 

Sure there is a limit, and you can see that right now with the pricing of F430's in the market. Just look at what the "resale" price above MSRP is for low or no mile examples that are being offered on the market for immediate delivery. Just remember that "asking" price is not the same as "selling" price, but that will give you an idea.

John

 

Gallardo base pirce w/stick: 177,600.
F430 base price w/stick 170,085.

Dave

 

I stand corrected. I thought the Gallardos were a lot less (maybe they sell below sticker?) and the Ferrari was more. They DO sell over sticker except to the washed few; but that's irrelevent to the point of the topic of course. Ferrari only sets the sticker, not the market.

Ken

 

According to the Wall Street Journal/Forbes Magazine (I can't remember which one) the average net worth of a Ferrari owner is $10mil and the average net worth of a Rolls Royce owner is $20mil. This was a survey based on new car purchases. So I am sure Ferrari could charge whatever they wish for their cars.

 

I think he meant Gallardo's MARKET performance (ie. sales)

 

I read a test of the (then) new Cornich in an old mag just last night... it said that Rolls estimated there American customer's avg yearly income was $14 Million!

I guess the new customers are different than the average overall customers.

 

Ooops, sorry Z0RR0! :O

 

I think there is a price ceiling for the future of the mid engined V8 cars (430 and its progeny), but i think Ferrari could sell its supercars to whoever they want for however much they wanted. I would like to see the specs, but I don't think many of the Enzo owners are living in the Enzo itself, paycheck to paycheck, paying only gas and rediculous insurance (but that sure does sound like the life!), and I think most of them have enough surplus income to pay over a million dollars for their cars.

 

My 328 GTS was about $64k when new in 1986. In today's dollars, that would be about $110k.

 

Ken,
I have run into many people who think that 430's are priced much higher than they are. My wife and I even had a bet on what the cost of our car would be. She took over 200K. Too bad for her! It is true that if you get paddble shift, cc brakes and a few options, you go over 200K. I do wonder how many Gallardos are bought by people who could not get a new Ferrari. I also wonder how many actually know that the Lambo is actually more money when new.

DAve

 

The 456 was priced at $208,000 in 1995, and I think around $240,000 in 2003, which almost exactly equals inflation over that period of time.

I don't think they had any problem selling 456s early in their model life. The problem comes when these cars get near the end of their cycle. Then, there are used ones available for half or less the MSRP of new ones, and there is often just not enough value in the new ones to justify it.

They are having that problem with the 575 today, even though it is a wonderful and well accepted car.

Also, in the US, there just isn't the demand for the V-12 cars that there is for the V-8 cars. So, the V-12s are a tougher sell and are probably priced about as high as they can go.

 

The FXX has a sticker price of 1.8 Million, and will sell (have sold?) every one of them.

I seriously believe Ferrari could charge anywhere upward of 3 Mil and the car will still sell out.

 

Only if the limit the supply to 20 total units. While these super unique cars have a following, it is very small. Suppose Ferrari could build 20 cars @ $3,000,000 MSRP each, resulting in $60,000,000 in total sales. How much does it cost to develop a super car? What would each super car cost to build?

Now compare selling vehicles at $500,000 each, to reach your total sales figure of $60,000,000 you need to sell 120 cars. You will enjoy more economies of scale at 120 than 20.

Now say we go further down market and use $300,000 as our MSRP, to reach $60,000,000 in sales would require 200 units.

I would propose the total cost to Ferrari to build 200 of the $300,000 cars would be cheaper than the building of 20 of the $3,000,000 cars.

While it easy to sell out 20 units, how hard is it to sell out 200 world wide? Especially if you let it be known 200 is the limit.

I would have to argue reducing the MSRP by 90% increases the potential market population by 1000%. The amount of people with 3mil to spend on a car is far less than those with 300k. The 3mil crowd are inflation proof or entertainers spending it as quick as they make it, the 300k crowd includes many business owners or trust fund kids.