Ferrari an Italian company, even though pushed back its profit target for next year due to the delaying investments in the pandemic stuck to its timetable for a first electric car by 2025.
The luxury carmaker famed for its ‘Cavallino Rampante’, or ‘Prancing Horse’, badge had predicted adjusted core earnings of 1.8-2.0 billion euros ($2.2-$2.4 billion) in 2022. But the company is postponing that target to 2023 because of the pandemic, even though it expects results to grow this year and next.
Chairman John Elkann said that they expect the prudent steps that they took in 2020 and are continuing in 2021 to adjust their expenditure in response to the pandemic and they will postpone by one year the achievement of their year-end 2022 guidance. The pandemic had also taken its toll on Ferrari’s drive to diversify its brand into other luxury areas and on its Formula One-related activities said Elkann.
The target delay was a very bad news for Ferrari’s highly-valued shares said a Milan-based trader. He also added that the impact is greater than expected. Ferrari shares closed down 8% in Milan. Elkann, the scion of Italy’s Agnelli family, which controls Ferrari through its holding company Exor said that their 2022 results will be better than 2021, which they believe will be very strong.
The delayed guidance did not change Ferrari’s long term challenges said the Morgan Stanley analysts. They also said that it leaves plenty of room for new management to discuss the potential beyond 2023 including an expanded model range. Ferrari would launch its first SUV next year, the Purosangue.
An electrification drive was already included in the group’s capital spending targets. A first full-electric model for 2025 has been promised by Ferrari. Even though the company is still in search for a permanent replacement for their former CEO Louis Camilleri, says that it is making good progress with a shortlist of strong candidates.