Ferrari's car sales have fallen slightly. Not much. But it is enough for the market to react violently and send the share into a major slump.
Ferrari's stock plummets following reports of falling sales figures and a notable drop in demand in the Chinese market.
In the third quarter, Ferrari saw an overall drop of 2 percent in the number of cars sold, while sales in China alone fell by 29 percent, which has put the share price under pressure and resulted in a drop of over 7 percent.
Reuters writes that.
Although Ferrari has historically managed to maintain steady sales growth and has seemed unaffected by economic fluctuations, it now appears that the luxury carmaker is also feeling the pinch.
In the past, Ferrari has been characterized by a continuous increase in car sales and a loyal customer base, but the latest quarter points to a different development.
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Despite the drop in volume, however, Ferrari has managed to increase both revenue and profit with the help of an expanded model range and several higher priced models.
In the third quarter, revenue increased by 6.5 percent and reached approximately DKK 12.2 billion (€1.64 billion), while the profit ended up at approximately DKK 4.7 billion (€638 million) – an increase of 7 percent.
Part of this increase is attributed to more customers being willing to pay extra for access to Ferrari's Tailor Made program and exclusive details on their cars.
However, Ferrari is hardly in any immediate crisis, as there is still demand for the newest and most expensive models.
The recently introduced models, including the F80, 12Cilindri and SF90 XX, have created waiting lists and maintained customer interest, according to analysts. Analysts expect this demand to positively impact sales in the coming quarter.
"The decline in volume does not reflect a demand deficit, but rather shows Ferrari's ability to allocate its supplies to match its margin ambitions," Bernstein analysts noted, according to Reuters.
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