It's no secret that SUVs dominate the car market these days. That's especially true in the elite echelons, where playboys and plutocrats seem even more SUV-mad than us plebes; cars like the Lamborghini Urus, Rolls-Royce Cullinan and Bentley Bentayga have been smashing sales records, earning tremendous profits and cementing those brands' future even in the midst of these uncertain times.
The major holdout has been Ferrari. The Italian brand held firm against building an SUV for a long while, before finally coming around to the idea publicly in 2017. Still, there hasn't been a mad scramble to get the new Purosangue SUV out the factory door. Ferrari has been taking their sweet time with it, because they absolutely do not need to build an SUV.
See, unlike, say, arch-rival Lamborghini, Ferrari isn't a cash-strapped supercar builder that's been snapped up by a giant automotive conglomerate to add prestige to the corporate ledger. Ferrari may be the most powerful individual brand in the automotive industry — and the company is already, without a super-profitable SUV, a money-making machine.
In fact, Ferrari makes so much money, parent Fiat Chrysler Automobiles (now Stellantis) spun the brand off as an independent company back in 2014. That move has been a rousing success. The numbers fluctuate with the wild stock market, but a market cap analysis from January had Ferrari being worth more than Honda, Hyundai and Ford — or nearly as much as the rest of Stellantis combined.
And that's how much money they make doing traditional Ferrari stuff: putting out stunning, high-powered sports cars and drawing in eyeballs on Formula 1. Even without a future-facing electric vehicle, a soccer mom-worthy crossover or a car priced below $200,000. Even while selling less than 10,000 cars per year.
Ferrari succeeds by making extraordinary profits on its cars. A study estimated Ferrari earned around $100,000 in profit per vehicle sold in 2019; that's nearly six times as much per vehicle as Porsche and 20 times as much as BMW. (And don't even bother comparing it to mass-market brands like Toyota and Ford.)
And building cars is far from the only thing Ferrari does. It is, after all, also a multi-billion-dollar merchandising juggernaut with a theme park, a multitude of branding partnerships and dozens of stores worldwide. The company made around $1 billion in profit from non-car-selling-related activity in 2018. Ferrari is also a de facto sports franchise: finances are murky about how much cash funnels into and out of the F1 operation, but Forbes estimates the Ferrari F1 team alone is worth $1.35 billion, about as much as a mid-tier MLB club.
Or, to look at it another way: 2020 was a down year at Ferrari, as it was in much of the world. Deliveries fell about 10 percent year over year, and net profit declined 24 percent; the F1 team was caught for unspecified engine cheating and fell off the pace dramatically. Still, Ferrari as a whole made around $70,500 per vehicle that left the factory.
There's no doubt that the Purosangue SUV will sell well. The Ferrari badge would have ensured that, even if the brand had just slapped a prancing horse on a Maserati Levante.
But the fact Ferrari isn't dependent on those sales should raise our expectations. The Purosangue doesn't need to save the company...which means they can afford to make it a true Ferrari.
