Ferrari has announced that it is canceling its contracts with every single one of its European dealers. The move is part of a restructuring plan for the company's European, Middle Eastern and African operations, justified by compliance with new European Union regulations and the streamlining of communication between the Maranello and the dealerships.

The cancellation of the contracts will take effect June 30, 2010, by which time many dealers expect to have theirs renewed. However, somewhere between a third and a half of the outlets may be closed for good before then. Sources suggest that once re-launched, the network will have been restructured into A- and B-class dealerships, but what those classifications mean exactly remains to be seen.

 

Wow, this is HUGE... I wonder what the EU regulations are exactly that would have such a massive impact on Ferrari?

 

I wonder if it is volume related?

 

I think this demonstates where Ferrari's real market is - the United States. This is one reason that Jon Todt and the F1 crew freaked out when Bernie decided that there would be no USGP this year. Ferrari wouldn't exist any more without the U.S. market.

Even though, this is a pretty drastic measure. They must have lost their grip on quality control with smaller dealerships - particularly in outlying areas. That usually comes from a period of unbridled expansion. You always pay for that - no matter how big you are.

 

^US and Mid-east. I think this has just as much to do with the high-demand for cars in the mid-east and the strict import laws for non-GCC spec cars through grey market channels.

 

With all due respect you are way off the mark my friend you would have been spot on 10 years ago but not anymore there is huge demand from emerging markets such as the Middle East and China plus the regulations their aren't as tough as US laws which means its easier for Ferrari to sell outside the US. you do realize that Ferrari only makes around 5000 units a year; even though a sizable amount end up in the US I'm sure Ferrari would have no problem selling them else where.
And Regarding F1 I'm a huge fan too but in the US people are into their own sports ie Indy, Nascar American football and baseball and for that reason I think F1 never took off the way it should there Ohh plus the huge time difference had to have it's toll on its popularity there

 

I hear you and I respect your post as well.

But the pool of individuals that have the resources and the interest level to actually purchase a Ferrari are not your average NASCAR fans. I would say that while the average person in the U.S. is not an F1 fan (you are spot on there), most Ferrari owners in the U.S. are. Ferrari's target market here in the U.S. is very interested in whether or not there is a race here. A race in the U.S. makes them feel like they are part of something larger than just owning a Ferrari. In fact, being a big F1 fan may be one of the primary reasons they decided to purchase a Ferrari in the first place. Whereas companies like Porsche and Audi don't participate in F1 largely because their U.S. customer base has little or no interest in it. It would be interesting to see an actual study on this.

Also, I think you may have misunderstood my prior post. I agree that there is rising demand for Ferraris in China and the Middle East. Ferrari sold 6,400 cars in 2007. Sales in the Asia Pacific and the Middle East jumped by 50 percent and 32 percent, respectively in 2007. Still, Ferrari only sold 177 cars in China in 2007 while selling 1,700 units in the U.S. Currently, the U.S. makes up 30% of Ferraris sales world wide - by far its largest market (Germany and and Britain are second and third). China is expected to be the 5th largest Ferrari market within the next five to six years. My point was that Ferraris best market is in the U.S. and that may be the result of quality control measures at the dealer level. If Ferrari were to lose 30% of its sales - the amount represented by the U.S. Ferrari consumption - it would go belly-up.

I got my numbers above from several sources including this article:

Italian car maker Ferrari sales up 14% last year - People's Daily Online

 

Touche, point set and match. When you're right you're right very valid argument you highlighted alot of points that I never considered and I'm glad to make your acquaintance

 

You made some very valid points as well. It is very true that the demand for Ferraris has gone up dramatically in China and the Middle East and that trend will only continue. Sadly, you are also correct about F1's popularity in the U.S. I am afraid that that will continue as well. To be an F1 fan you have to be in love with the technology represented by the cars. It has to be a love of both the thrill of racing and the mechanical side. Most people in the U.S. don't have the patience to try and understand the "gear head" side of F1 which is a big part of it.

Great to meet youy too! Isn't this a great site for meeting other enthusiasts! How is Bahrain this time of year? Did you attend the GP there??

 

Barrister, I wouldn't say Ferrari owners are F1 fans...but if they watched it they would be Ferrari fans. Do a poll here, see how many Ferrari owners follow F1. I bet Ferrari would be more popular in the US as a PGA sponsor.