Gliding atop robotic transporters, a line of Ferrari frames maneuvers through a gleaming new factory in northern Italy. At each station, engineers in cherry-red uniforms add a component—an engine block, a dashboard, a steering wheel—as they transform the bodies into hybrid vehicles. Next: all-electric.
The stakes are high for Ferrari’s 200 million euro “e-building,” which opened last month and is nearly twice the size of Rome’s Colosseum. The factory is set to usher the 77-year-old sports car maker, known for the resounding drone of its gas engines, into the age of electrification.
But the effort comes at a precarious time for the auto industry. The transition to electric vehicles, which should have ushered in an era of climate-friendly transportation, has instead been hampered by costly investments and slowing global demand.
Other luxury automakers have struggled to go electric. Mercedes-Benz and Lamborghini have scaled back their ambitions. Tesla reported declining second-quarter sales on Tuesday, and Ford Motor said in April it would shift production to more hybrids as losses in electric vehicles mounted. A growing trade war between China and the West also threatens to depress growth.
Despite the challenges, Ferrari sees an opportunity in the industry’s inevitable march toward electrification to reach a new consumer: the wealthy environmentalist. The company plans to unveil its first all-electric model in the fourth quarter of next year. As part of its strategy, the automaker has tapped LoveFrom — the agency founded by former Apple design chief Jony Ive and industrial designer Marc Newson — to refine the car’s look.
There’s a lot of mystery surrounding the yet-to-be-named car, including its battery life and what it will sound like. The company hasn’t released any details about its looks, production run or price tag. But it could be one of the most expensive electric vehicles on the market, analysts say, and could top Porsche’s $286,000 Taycan Turbo GT.
Ferrari's foray into electric will be notable for other reasons. Regulators may be pushing electric vehicles, but there's still skepticism in the market. Winning over internal combustion fans won't be easy, even for Ferrari. And the industry is desperate for a carmaker that each car manufacturer, to prove that electric vehicles can be very profitable.
“It’s worth seeing if a Ferrari EV can maintain the price point you associate with a Ferrari,” said Martino de Ambroggi, an auto analyst at Equita, an investment bank in Milan. “Often, a Ferrari purchase is also seen as a kind of investment. Only after a few years will we see if that investment in an electric Ferrari holds up.”
Ferrari CEO Benedetto Vigna is doing his best to keep the market in suspense. In an interview last month at the new factory, he said the company would begin full production of electric vehicles in early 2026. By 2030, electric and hybrid cars will account for as much as 80 percent of Ferrari's annual output as the company tries to meet the European Union's tough emissions standards.
In the meantime, the e-building is rolling out two models: the SF90 Stradale, a plug-in hybrid, and the Purosangue with a combustion engine.
Ferrari doesn’t need an electric vehicle to boost its profit margins. Under Mr. Vigna, a former executive at chipmaker STMicroelectronics who took over nearly three years ago, the company is on a roll. Its stock is one of the best performers in Europe this year, with a market value of about $75 billion, bigger than Ford or General Motors. Profits are rising along with prices at Ferrari, which makes some of the world’s most expensive cars. Some models have a three-year waiting list.
Ferrari's success on the Formula One circuit over the years has also led to a lucrative corporate sponsorship and merchandise business that has transformed it into a luxury brand with a sporty flair. Ferrari's prancing horse logo can be found on high-end clothing, such as a €790 cashmere sweater.
Mr. Vigna sees the electric vehicle as part of the company’s growth strategy, despite the industry slowdown. “There are a number of potential customers, I have them clearly in mind, that will never be part of the family unless there is an electric car,” he said.
But there are challenges. Enthusiasts who gathered outside the factory gates last month wondered: Will it look, drive and sound like the classic Ferrari growl, or will it have the subdued whine of most electric vehicles?
“When you think of a Ferrari, you still have that kind of engine feeling, and you also think of the roar,” Mr. de Ambroggi said. “I don't know how Ferrari solves this.”
Mr. Vigna often answers these questions, especially from regular customers or Ferraristi.. They appear to channel the late founder Enzo Ferrari, who once explained in the simplest terms how he built some of the fastest cars in the world: “I build engines and attach them to wheels.”
Mr. Vigna’s EV pitch sounds different. “The electric motor will not be silent,” he said. “There are ways to make sure that the emotion of driving an electric Ferrari is the same as when you drive a hybrid or when you drive a thermal Ferrari.”
Battery life is another piece of the puzzle. Because Ferraris often sell for a higher price on the used market, concerns about battery degradation and its impact on the long-term value of the car may be felt more acutely by Ferraristi.
“The transition to electric vehicles brings a lot of new issues for them in terms of vehicle maintenance,” said Stephen Reitman, an automotive analyst at Bernstein.
Ferrari's long-term partner, SK On, a South Korean battery manufacturer, will supply the components for the electric car batteries. Ferrari will assemble them in the e-building, where the car's electric motors and axles are also made.
And then there is the matter of price. Last month, Reuters reported that the car would cost at least €500,000 ($540,000). Mr. Vigna pushed back against the speculation, saying it was too early to talk about price.
Ferrari still follows its founder's principle of producing a limited number of extremely expensive cars. Ferrari made fewer than 14,000 last year; even with the e-building, production is not expected to increase much at first.
The limited numbers perhaps explain why fans travel to Maranello in the hope of catching a glimpse of a Ferrari, either at the company's Formula 1 test track or near its red-brick factory.
Knowing that demand is high, Mr. Vigna has increased the base price of most models by more than 25 percent.
“Ferrari consistently sells less than the market demands, leading to a multi-year backlog,” said Mr. Reitman, an analyst at Bernstein. With a profit margin of nearly 30 percent, Ferrari's business is more like that of a luxury brand like Hermes or Rolex, analysts say.
Mr. Vigna is already thinking about how he will market the new electric car. The target audience is unlikely to buy the car for purely practical reasons or even to save the planet, he said, adding: “The emotional part of the brain drives the purchase.”
