Ferrari will carefully consider feedback about the Luce
...but not yours.
There’s an extremely high probability that you’ll never own a Ferrari. There’s also a high probability that you’ll never drive a Ferrari. There’s a decent probability that you’ll never even be a passenger in one. And yet, if you’re a reader of this substack, it’s likely you have an opinion about the Ferrari Luce.
How much should Ferrari care about your opinion?
The answer is pretty simple: Ferrari should care about your opinion less than Jaguar, Mercedes, and Tesla do… which is basically not at all.
Many months ago, on Patreon, I wrote about why Jaguar and Tesla don’t care what automotive enthusiasts think. I’ve since abandoned that site, so let me just summarize the Jaguar/Tesla position:
“Fuck you, broke-ass bitches.”
When the Jaguar Type 00 debuted, the internet was rife with opinions. Basically none of which were from people who ever bought or ever will buy a Jaguar.
Instead of appeasing the many opinionated non-customers, Jaguar has focused on trying to get actual customers interested in their product. New customers, since all of their previous ones are dead or dying. But specifically customers who have drastically different tastes and opinions than car enthusiasts.
This is exactly what Tesla did and why they’ve been so successful. Tesla realized that most car buyers are not car-enthusiasts, so it’s actually stupid to appease car-enthusiasts. After initially coming to market with an upscale EV that solved a bunch of problems that non-enthusiasts have with cars, Tesla went down-market, shooting for volume.
Unfortunately, everyone down-market is now incredibly poor. So, Tesla’s initial strategy “fuck car-enthusiasts” has been replaced to reflect current economic realities.
The new strategy is “fuck cars” and they’re gonna build robots. Which is sort of a tangent, and not one I’m particularly interested in today, since Ferrari hasn’t announced a humanoid robot… yet.
The Luce is Ferrari looking at what Tesla did, and what Jaguar is trying to do, and saying, “hold my Peroni.”
They’re following the same playbook, just with a couple massive advantages.
For starters, Ferrari is selling a product that is much more exclusive and expensive than a Tesla or Jaguar. And that means they have even less reason to care about what car-enthusiasts think. Their customer isn’t gonna be swayed by the opinion of a guy doing donuts at a takeover in a Dodge Challenger financed at 23.99%.
But I know several of you currently reading this are automotive journalists with a wealth of experience and mostly well-formed opinions. You’re probably thinking, “surely Ferrari should care about my opinion! Just look at what our collective opinions did to their stock price!”
Published responses to the Luce probably did contribute to a relatively large sell-off and drop in Ferrari’s share price… which it recovered from 48 hours later. The price didn’t even drop below where it was seven days earlier and, as of this writing, the price is the highest it’s been in a month.
“Wow! Auto journalists sure have a lot of power! Fuck the enthusiasts, but we’d better pander to the journo’s tastes!” That’s probably not echoing through the halls of Marinara.
The negative business impact of the entire automotive world’s outrage lasted just four days. This has just confirmed to Ferrari that they are on the right track. Non-customer opinions really don’t matter. And besides:
Critics have mostly missed the two reasons why the Ferrari Luce is guaranteed to succeed.
Nearly everyone I’ve seen talking about the Luce seems to assume that the U.S. automotive market is representative of the global market. Or at least way more important than it actually is. To be fair, the U.S. is Ferrari’s largest single-country market (about 24% of sales), but our economy is looking kinda iffy and sales are already declining. Every day, Ferrari has less reason to care about appeasing Americans.
I’ve been stunned by journalists incredible blinders here, though, as they parrot claims like “nobody’s buying EVs” or “luxury buyers aren’t buying EVs.” That might be true in the U.S., but it couldn’t be further from the truth elsewhere. Especially as the U.S. drives up global oil prices.
When American journalists do consider other markets, they seem to only consider mainland China and western Europe. Those markets are certainly counterexamples to “nobody’s buying EVs” but two others more strongly exhibit reason #1 for the Luce’s inevitable success.
Let this sink in for a minute: The number-one and number-four oil-producing nations in the world are seeing record-breaking increase in EV adoption. And, if memory serves, there are a few Ferrari customers in those nations.
Ferrari actually sells more cars in the Middle East than it does in mainland China. It sells even more in Hong Kong and Taiwan, both of which are also seeing rapidly increasing EV adoption.
Is that rapid EV adoption also happening among the affluent who might buy Ferraris? I don’t know. If this were a scientific publication I would punt and call that “directions for future research.” But this isn’t a scientific publication, so instead I’ll say, “look it up your damn self.”
I also don’t think it matters much:
The Luce will probably be the reason why affluent buyers adopt EVs.
I suspect in their market research Ferrari asked a bunch of Ferrari owners why they haven’t bought an EV yet, and they replied, “because EVs are made for commoners.”
If you’re used to driving a Bentley or Maybach, a Model S or Lucid Air is gonna feel like it came from Kohl’s. Obviously there are hypercars like Rimac, but there really isn’t a daily-driver EV option for the discerning billionaire. The Luce is breaking ground here.
Also, let’s face it, a ton of Ferrari buyers buy Ferraris because they say “Ferrari” on them. In fact, a lot of wealthy people will buy literally any ridiculously overpriced thing that says Ferrari on it.
Here’s a Ferrari phone that cost $40,000:
Here’s a $45,000 Ferrari camera:
This was a high-end model when it released in 2011. The addition of Ferrari branding added $9,500 to the already steep price.
A lot of people claim the Luce will fail because of its $650,000 price tag.
They then proceed to run comps, and show how spec-for-spec, the value isn’t there. I honestly don’t think the type of customers that Ferrari is going after will give a shit about any of that. Really. You just have to put it into perspective.
If you have a net worth of $100M — that’s about 30,000 people globally — and buy a car that costs $650,000, that’s equivalent to having a net worth of $100,000 and buying a car that costs $650. Just speaking for myself, if I could have a brand-new Ferrari, with a ridiculously low cost of ownership (for a change) at just $650, I’d buy ten.
When Tesla started, it had zero brand recognition. The value proposition had to be there from the beginning. The price mattered. And Tesla lost money on every car they sold for ten years (they made it up on carbon credits… long story). Ferrari doesn’t have this problem. It’s already one of the most valuable brands in the world.
So, Ferrari’s massive advantages, that will ensure the success of the Luce are (1) it’s not dependent on the US market to sell prestige vehicles and (2) the name can sell just about anything.
Put lipstick on a pig, and as long as it’s Ferrari red, people will buy it.
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