Ferrari: Strategy in Transition - Abridged

Set in January 2018, the case presents the situation facing Ferrari Chairman and CEO Sergio Marchionne as he considers the future of the septuagenarian racing and luxury performance car company. During his tenure, Marchionne steered Ferrari onto a trajectory of sustained profitable growth. He split the company from Fiat-Chrysler, floated it on the New York Stock Exchange and expanded production beyond a self-imposed limit of 7,000 cars per year. Between 2015 and 2017 shipments increased 10% and share price more than 100%. But the auto industry was undergoing structural change, including the emergence of electric-motor technologies, toughening emissions regulations and changing consumer preferences, which could render Ferrari’s strategy irrelevant. Marchionne pondered various options, such as the introduction of an electric supercar and an exclusive SUV – options that had profound implications for resource allocation and other strategic decisions.