Despite the instabilities in the global economic market, sales of exclusive, ultra-expensive personalized cars such as Lamborghini, Ferrari, Rolls-Royce and others are on the rise.
“I am so incredibly proud to announce that we have reached another historic milestone,” Stephan Winkelmann, Lamborghini’s president and CEO, said on Linkedin.
This Italian manufacturer of luxury sports cars sold more than 10,000 vehicles for the first time in its history last year, while Ferrari achieved a 17% increase in revenue.
As announced by the company, Ferrari achieved revenues of 6.46 billion dollars and a profit of 1.36 billion dollars in 2023.
The enormous profit is proof of how serious this brand was when it announced earlier that it would develop its vehicle personalization program, which in 2023 brought it more than 460 million euros in increased profits. And he does not intend to stop at these figures in 2024, especially after the recently launched Purosangue SUV, which found its customers among the richest.
“The market is growing in terms of population, but these rich people are also getting richer. Personalizations and customizations (of cars) were actually a key driver of better-than-expected earnings during 2023,” Javier Gonzalez Lastra, investment partner at Tema ETFs, which manages the luxury goods investment fund, told CNN.
$380, which was the price of Ferrari’s stock last Thursday, reached its highest level in the past 52 weeks, and as reported by CNN, it is very likely that the arrival of seven-time Formula 1 champion Lewis Hamilton in the ranks of Ferrari contributed to this jump.
If you compare the more than 10,000 cars that Lamborghini sold last year, and the number of vehicles sold by other manufacturers (according to MoneyShake data, Toyota produces 19.9 cars every minute (about 10.5 million million per year), Volkswagen 19.8, Hyundai 13.7, GM 13, and Ford 12.2 cars per minute), to some the number of the Italian manufacturer may seem small. However, manufacturers of ultra-expensive cars are not interested in mass, because by making a limited series of their cars, they preserve exclusivity.
Ferrari, for example, sold only two of its 125 S vehicles back in 1947 and has maintained its business philosophy of limiting the number of vehicles sold to this day.
“The waiting period (12 months) is considered the best indicator of the value of the brand, the very essence of the brand is built on its exclusivity,” explained former Ferrari CEO Louis Camilleri.
A $13 million car
Manufacturers of personalized cars find their customers in the richest strata of society. And it is a special niche of the automotive industry that is not affected by tectonic changes or breakdowns of economic systems on a global level. By 2028, that group of ultra-wealthy could number 528,000 people, estimates Altrati, a company that studies wealth trends. Compared to the eight billion inhabitants of the Earth, this is a drop in the ocean, but a drop weighing trillions of dollars.
Let’s go back in time a little and remember the promise of Rolls-Royce’s leaders that they would seriously devote themselves to the creation of extremely expensive cars made according to the wishes of their customers. In 2021, they introduced their Boat Tail car, and with it the new Rolls-Royce Coachbuild program, whose department was tasked with working with individual clients to build a car especially for them. Boat Tail was made for three customers, whose identities the company did not want to reveal. Four years earlier, in 2017, Rolls-Royce unveiled the Sweptail, built to order for, also for an unnamed wealthy client, which was estimated to have cost around $13 million.
Bentley also had an ace up his sleeve. It was the Bacalar, a car made in only 12 copies, and one copy cost two million dollars.
And, where is it in the market reality of Bosnia and Herzegovina?
Customization of already expensive cars (limousines and SUVs) is a completely normal phenomenon in this niche of the automotive industry. And as technology advances, the expectations of ultra-rich consumers will increase, because the philosophy of today’s demand and supply, which is perfectly understood by the manufacturer, is that today’s driver is not only a passenger, but also an active participant in creating the appearance of the car and its functionality.
And where is Bosnia and Herzegovina in this market reality? According to data from the Administration for Indirect Taxation, 9,364 new cars were imported into the country in 2023. The top ten most expensive cars imported into BiH are dominated by Mercedes and
Porsche, and in the list of the top 10 best-selling cars last year, there was also a Ferrari.
“As far as luxury cars are concerned, there is no market that cannot afford them,” says Armin Mulović, brand manager of the Porsche brand for Bosnia and Herzegovina at the company Porsche BH, explaining that the sector for specially personalized cars has always existed in their company, but the trend is growing in the number of clients who want such cars, noticeable since 2018 and 2019.
“This is the period when the luxury car market is recognized in BiH as well. When such cars stop being intrusive on the roads. They are especially common today. The BiH market may be specific, but it is not poor and it is a market of both medium values and luxury,” he says.
The post-covid period showed, he notes, that people are ready to invest more and more in order to have a specific car that would make them stand out when it comes to luxury.
When asked how many custom cars they delivered last year, he says:
“Of the 107 cars ordered, each of which had some specifics, maybe 20 were with very specific requests from customers in terms of additional equipment.”
From ventilation to seat massage, ambient lighting inside the vehicle, which should be perfect, especially when driving at night, to matching the color of the thread used in the interior of the vehicle with the color of the exterior of the vehicle… these are just some of the details and finesse that with the most modern digitalization vehicles, and other technological features, pay attention and look for BiH. car buyers who want to experience a personalized driving experience.
“Simply, the client increasingly uses the vehicle as a space, that is, a second home where he spends most of his time,” says Mulović.
And finally, taking into account statistics and trends at the global level, the conclusion is that the trend of personalized vehicles in 2024 is not just a fad, but clearly the future of the automotive industry, Forbes writes.