The most expensive cars are selling fast
Price cars amazing on paper and on the road. For the makers, they also often leave a good impression on the income statement. Global car sales in 2022, at around 79m vehicles, are below the level of a decade ago. But demand for finer sets of wheels costing more than €100,000 ($107,000) grew by about 6.5% a year over the same period, according to Bernstein, a broker.
Last year the increase was particularly noticeable for the most special motors. But 1.3% fewer cars were sold in 2022 than the previous year, according to s&p Global, a consultancy, said on January 9 that Rolls-Royce had sold 8% more of its standard car models last year. Ferrari, the Italian manufacturer of games for the rich (of which the largest shareholder, Exor, is also a part) The Economistmaybe it will be even better. Between January and September Ferrari sold 20% more cars than in the same period the previous year.
The couple control a small but profitable space. Rolls, which belonged to the Germans bmw, sold more than 6,000 cars last year – a record. In 2021 it provided more than half of the world’s cars that cost more than €250,000, according to Bernstein. Ferrari’s share was higher than a third. Lamborghini, an Italian sports car company owned by Volkswagen (vw), accounting for most of the rest. Both Italian marques are going strong in the €150,000-250,000 bracket, which is dominated by Porsche (spun from VW last year to become one of the most valuable car makers in the world). On January 10 Bentley, a VW– a property powerhouse in that (slightly) less intimidating segment, said it had sold more than 15,000 vehicles for the first time in 2022, 4% more than in 2021.
Rolls doesn’t get his hands dirty with such proletarian ramblings. Special elements – unobtrusive paint jobs, interesting leather-and-wood interior, champagne chests to match – have pushed the average sales price of a Roller above €500,000. Each generates huge profits. True to the choice that its customers appreciate, the company does not say how much profit; it will probably be more profitable than Ferrari, which has a rich operating margin of around 25%. Even Porsche’s 15% or so, let alone around 10% for all major carmakers, looks puny by comparison.
Ferrari’s market capitalization of $43bn makes it the 11th most valuable listed car company in the world. In terms of market value per car sold, it is miles ahead of the pack (see table). Rolls would, too, if it were an independent company. Both have deftly maneuvered the luxury goods market, keeping track of supply and high prices.
Now both companies have to navigate the progress of the electric industry. This presents different challenges for each. Even run-of-the-mill EVthey are lightning fast, part of the Ferrari appeal, and offer a smooth and quiet ride, which made Rolls engines famous in the petrol era. For Rolls, which begins to deliver the first EV, the Spectre, at the end of 2023, at least the brand has silent electric motors. Ferrari faces a more delicate task, which has a throaty roar as part of its appeal. It is certain that its engineers are hard at work making sure that the first ride is full EVexpected by 2025, handling like a racing car despite a heavy battery. ■
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