Specialty Postcard from Rome: Electrifying the Discussion
Premature to draw conclusions on brand equity impact
Investor consensus ahead of the Ferrari Luce presentation was largely that it would be a “non-event”, reflecting the widely held view that EVs are unlikely to become central to Ferrari’s equity story, with combustion engine models expected to remain the core driver of brand equity and profitability. However, the model’s design and certain features triggered a notably negative reaction across both traditional and social media, raising concerns around potential brand dilution and driving an ~6% share price decline. While it remains too early to assess any structural impact, our discussions with Ferrari clients (>15) during the event were more constructive, pointing to stable underlying loyalty despite muted enthusiasm for the model. In our view, the EV offering is more likely to act as a complementary extension to the range rather than a fundamental shift in the brand’s positioning. That said, while we recognise the need to diversify the offering in response to evolving consumer preferences and regulatory pressures, we believe a more gradual evolution of the brand may be preferable to a step-change transformation, particularly given the risk of less favourable customer reactions to future launches. With a broader pipeline ahead (three new launches in 2026), we expect Ferrari to continue balancing new customer acquisition with its disciplined, scarcity-driven strategy.
A one-off rather than a structural shift in design
The negative reaction to the car was largely driven by its design, which we view as a one-off rather than indicative of a broader shift in Ferrari’s future design language. Customer sentiment on both design and value-for-money was mixed, and softer than pre-event expectations, hence Ferrari may need to rely more on collectors than initially anticipated, although new customer recruitment should still exceed that of an average Range model (UBSe ~40% new customers for Range cars). With the order book only recently opened, the customer mix remains uncertain, but Ferrari is clearly targeting buyers who already own an EV or those who were considering purchasing one of the now-delayed EV launches from competitors.
Margins in line with other Range models
The other key area of debate has been pricing, which, relative to other EVs and given its feature set, may appear high, particularly as personalisation could push the price beyond the €550,000 base. This pricing reflects multiple factors, including the significant investment in the car’s development and design. Importantly, from a margin perspective, Ferrari Luce appears in line with other Range models. While Ferrari has not disclosed specific volume targets, we expect the product lifecycle to be consistent with a typical Range model, at around 4–5 years.
Valuation: Buy, US$483 price target
RACE trades on 17.0x 2026e and 15.6x 2027e EV/EBITDA for 3-year sales and EBITDA CAGR (2026-29e) of +8% and +8% respectively.
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