September 9, 2014

"They will make Ferrari become American" Montezemolo

Luca di Montezemolo and Marco Mattiacci

It's open war now between Luca di Montezemolo and FIAT's chief Sergio Marchionne.

Marchionne's harsh words  during the Italian GP week end leave little room for maneuvering, except perhaps with respect to the size of di Montezemolo's exit bonus.  

Not that di Montezemolo is taking it sitting down.   Milano's Corriere della Sera quotes the Ferrari president as  calling this "the end of an era" and that Marchionne and the new family leadership at Fiat will make " Ferrari become American".

What does that mean and how does it relate to racing anyway?   Will they all have to wear sweaters?

with Gianni Agnelli, his son Edoardo Agnelli and Cesare Fiorio
It has to be seen in a historical context,  in the 1960's Enzo Ferrari flirted with selling the company to Ford then famously backed out ( resulting in the GT40 ).     In the 1990's Gianni Agnelli engineered a deal with General Motors which famously resulted in GM paying FIAT not to have to acquire  it.    Specifically excluded from that deal from the beginning was Ferrari, Agnelli had no intention of selling his prized jewel, one which was controlled at 90% not by FIAT but by the Agnelli family trust. (10% by Piero Ferrari)

Ferrari had been controlled but independent from FIAT since.

With Lapo and John Elkann
Di Montezemolo has been president at Ferrari since 1991, he's overseen the spectacular success  of the highly profitable road car division, gone from near bankruptcy and the lows of the 348 to the current lineup of arguably the best road cars in production.  Along the way he did not fall into the temptation to dilute the brand with SUV's or sedans or more "affordable" models as other competitors have done.  Thursday this week at the Ferrari board meeting, he's expected to announce the largest profit ever achieved by the company.

On the competition side, di Montezemolo
oversaw the Schumacher era with successes yet unrivaled in the past 20 years: 6 driver's Championships and 8 Constructor's titles.

But time passes, Agnelli is now gone as is his brother Umberto, both dying within a year of each other and what used to be the Agnelli family is now New York born John Elkann,  the chief executive at FIAT is now Canadian Sergio Marchionne,  FIAT is now FIAT Chrysler.

Marchionne has brought in "american style" management and the new group will go public in New York October of this year.   FIAT still has not built a decent car of note except the 500  so the prestige of Ferrari is key for success on the stock market along with Maserati and Alfa Romeo.  Some say Marchionne wants an American to head the prancing horse, some say he will step in himself.  For sure the plan is to expand production.

The doubt, many fear, is that a Scuderia Ferrari not insulated from the larger FCA group could be vulnerable to market pressures,   No wins at the track could be seen as a reason by shareholders to just pack up and go home,  like BMW did, like Toyota and Honda did.

These is the realities of giant conglomerates but it has never been Ferrari's, the one team that has participated in every single Formula 1 Championship since its inception.

Through thick and thin, triumph and misery.

Already press is speculating on the future of Fernando Alonso at the Scuderia. He and di Montezemolo were in the midst of renegotiating the 2017-19 contract extension, thought to be in the order of 30 million euro a year (based on what Mclaren Honda is said to have offered the Spaniard).    If Marchionne steps in, it would effectively have to be a now contract, says Autosprint, and the Canadian, notoriously averse to paying out big salaries , would be in a position to have to justify that huge contract while defending the deep and painful cuts made to FCA.

Complicated.

Not exactly the picture you want to present to potential investors.  Enzo's not happy.

15 comments:

  1. Luca di Montezemolo's management style of fear, intimidation and public shaming and blaming has created a chilling effect on the F1 team. Luca has created an environment where people are afraid to make mistakes and are working to keep from getting fired. The result is that creativity and innovation have suffered and no one enjoys their jobs. There is no clear vision and direction in the F1 division because no one wants to take responsibility and then suffer the blame.

    Luca's done a great job with the Ferrari road car division (except for giving a great car a silly name like "La Ferrari") but until he's removed from running the F1, team nothing fundamental will change.

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  2. I think it would be a huge mistake for them to remove LDM. He's largely responsible for what makes the Ferrari brand what it is and if it's a matter of success on track, pay Brawn whatever it takes to have him run the F1 team again. Guys like Brawn never stay "retired".

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  3. .... Great comments , and yes I would be worried about the bean counters invading Ferrari. The sweater man is best suited to running Chrysler and Fiat, let the Armani guy run Ferrari

    Bernie will be worried too... He needs Ferrari aswell

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  4. Years ago there was a post on a Ferrari forum that there was a call to be more Italian at Fiat and more so at Ferrari. I guess there was some jealousy that a German, Frenchman and Englishman was so instrumental to Ferrari's success; basically removing the structure LDM and Todt, Brawn implemented. It was right around when Schumi, Brawn and Todt quit or was forced out (I know, I know, they didn't quit at the same time but...). The rumor at the time was that LDM was the one fighting to keep the structure in place while the Fiat board was demanding more italian talent within the F1 team. Fast forward to 2014 and it seems that there was some credence to the rumors, the Scuderia is in shambles ever since and the talent has dried up. There's nothing innovative about the Scuderia and mostly aping other teams.


    Now that being more italian didn't work I guess its only fair to try the Candian/American way? Its funny that Fiat removed the most Italian symbol at Ferrari since Enzo.

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  5. Two words
    Flavio Briatore

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  6. To me the problem is not the management of Ferrari as Corp.


    The actual problem is in racing department and in the team.
    To me they need a Driver that get the team organized and also get everyone behind him.


    Shummy was the best on that... build a team around him.

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  7. Ferrari as a brand is becoming a bit more "mainstream". The Ferrari World is a prime example. Now if this direction gains momentum, I'm afraid it'll no longer hold that magic and thus won't be able to keep that image. I remember when porsche was about sportscars and how excited I was as a kid when I saw one. Now every mom in the gulf area drives one and when someone says he drives a porsche, a butt-ugly panamera or Cayenne springs to the minds of everyone. Ferrari now occupies a niche in the market, almost all to its own. If it does go "american" I can easily see the like of McLaren, Lamborghini or even Pagani taking its place (can u imagine a less expensive Paganism going racing? That would be awesome!).
    As for the F1 involvement, remember that people support the F1 team, not the car factory. Wearing a Ferrari T-shirt will become like holding a rolls-Royce key chain with a Kid key in it. Just a way of telling people what you want but actually can't afford...

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  8. A driver alone wont fix what's wrong with the team. Alonso isn't half bad either.

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  9. I never said Alonso is bad.
    To me Nando is the best in the field ATM. Actually I think he is better Driving that was Shummy. Where I think the german was great is in "motivate" and get who ever / What ever is needed to be the best.


    Remember were was Ferrari with Alesi / Berger and who were the designers / Engineers and who join the team when MSC arrived...


    To the outside you will never hear someone bitching... it's well known the huddles and WTF meeting to the inside. But that only internal.

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  10. Just one after Di Montezemolo's resignation new that Ferrari will increase production by close to 40% http://www.bloomberg.com/news/2014-09-11/ferrari-to-boost-production-to-keep-pace-with-super-rich.html …

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  11. well, no doubt Ferrari have taken aspirational marketing to a whole new level...

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  12. Alonso and Raikkonen are the last of the Scuderia's problems

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  13. More Caraceni than Armani :)

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