Ferrari Indonesia demonstrates the power of brand exclusivity
Indonesia’s car sales were sluggish in 2017. According to the Indonesian Automotive Manufacturers Association, the country saw 1.08 million units shipped throughout the year – a modest 1.6% rise, year on year. Ferrari’s authorized distributor in the country, Citra Langgeng Otomotif, however, is not worried. In fact, the ultra high net worth market that Ferrari targets has shown relative immunity to the slow growth.
Ferrari’s share price has increase by 24% so far this
SOURCE: Yahoo Finance
Ferrari in Indonesia is managed slightly differently to Ferrari in other countries – but the end result is the same: a brand that is prized for its reputation and exclusivity. Prices, for example, are confidential in Indonesia, discussed only between the company and the prospective purchaser. Likewise, Ferrari is eager to contact prospective customers in the country and court them personally – a far cry from how it operates in its larger western markets.
Nonetheless, this approach is working. While the auto industry around it grinds along, Ferrari is meeting its expectations. Arie Christopher, Ferrari’s boss in Indonesia, was customarily reserved when it came to discussing those expectations, saying: “so far, we are still on track in sales.” He declined to disclose the company’s sales in the country for 2017.
Arie said that the company has delivered 20 tailor-made Ferrari cars through a customization program which allows customers to modify the exterior and interior of their new supercars. He’s confident of more growth from that service. If he’s right, it will prove something that many Ferrari bulls have been saying for a long time: when you trade on quality and exclusivity, you should never be afraid to add another zero onto the price tag.
Dominion holds Ferrari in its Global Trends Luxury Fund.
If you would you like to receive the Newsfeeds daily, please click here to sign up now!Help us make this Newsfeed better by rating this article. 1 star = Poor and 5 stars = Excellent
- Click here to print this story: Print
The views expressed in this article are those of the author at the date of publication and not necessarily those of Dominion Fund Management Limited. The content of this article is not intended as investment advice and will not be updated after publication. Images, video, quotations from literature and any such material which may be subject to copyright is reproduced in whole or in part in this article on the basis of Fair use as applied to news reporting and journalistic comment on events.