Decreasing production to increase profits at Ferrari

An article in the Financial Times (June 11, 2013) describes a plan to decrease production by Ferrari by 400 vehicles this year, down to 6,900 cars. The plan is to continue to maintain the exclusivity of the brand, add capacity and also offer lower cost branded consumer products to maintain revenues and increase profitability. Brand exclusivity is expected to generate an interest in jackets, bathtowels and sunglasses branded by Ferrari. But use of Ferrari engines in Maseratis, another Fiat brand, are also supposed to be enabled by the added capacity. Is this focus on exclusivity the right strategy for Ferrari and does it offer lessons for other brands seeking to maintain their global cachet ? Is the spillover of the brand success to sales of the higher volume consumer items a sustainable strategy ?

About aviyer2010

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