Hard on the heels of Sergio Marchionne throwing Luca di Montezemolo under the (Fiat) bus, comes the announcement that FCA (Fiat Chrysler) places current holders of FCA shares as owners of 90% of Ferrari, with 10% of Ferrari to be offered to the public. And that is stunning – Fiat has been a decent steward of Ferrari over the years.
Why would Fiat want to loss the goodwill that Ferrari represents, they’ve owned Ferrari since 1969 (and that leads back to the convoluted Ford vs Fiat war to buy Ferrari, a tale for another day)? Possibly Ferrari’s heritage – and continuing worth – are too tightly intertwined with Formula 1; and it’s possible that FCA has read the handwriting on the wall, that F1 is about to go through a stretch in the wilderness. And with declining public interest in F1 and a resulting loss of revenue, that is not offset with declining costs, maybe FCA decided now was as good a time as any to extract maximum value from the brand.
Opportunities for individual enthusiasts, who can’t otherwise afford a Ferrari, to now be owners of Ferrari could lead to a feeding frenzy when the IPO hits. The stock certificates should be well designed, hopefully, because one wonders just what the future will hold for an independent Ferrari. One that will be bleeding cash as F1 proves to be an albatross.