New Ferrari CEO Louis Camilleri has kept himself under the radar since he took over the helm in the wake of Sergio Marchionne’s unexpected passing, however, the new chief at Maranello has first acted to pacify shareholders while acknowledging that negotiations with Liberty Media regarding the future of Formula 1 are on track.
Louis Camilleri was appointed chief executive of the Italian supercar maker on July 21, succeeding Sergio Marchionne who fell seriously ill and later died after suffering complications following a shoulder surgery. The sudden change jolted investors who had expected Marchionne, who nearly tripled Ferrari’s value since taking it public in 2015, to stay on as CEO and chairman until 2021.
It also left Louis Camilleri, 63, to finish scripting a midterm strategy that will be presented in September and is meant to show how the company plans to achieve financial targets unveiled earlier this year by Marchionne, notably a goal to double core earnings to 2 billion euros ($2.33 billion) by 2022.
Camilleri, a tobacco industry veteran, was chairman and former CEO of Philip Morris International (PMI) and has served on the Ferrari board since 2015, while Marchionne, in turn, sat on the board of PMI. Nevertheless, the Italian executive has a tough act to follow.
Sergio Marchionne orchestrated Ferrari’s spin-off from parent Fiat Chrysler, positioned it as a luxury icon rather than a car manufacturer and managed to do what few thought possible: sail through a self-imposed cap of 7,000 vehicles per year without sacrificing pricing power and exclusive appeal.
When its share price hit a record high of 129.90 euros in June, the company that sold just under 8,400 vehicles last year was worth around 24 billion euros, almost as much as Fiat Chrysler, which shipped 4.7 million cars.
Scuderia Ferrari and their Formula 1 team are joined at the hip since Enzo Ferrari began building road cars so he could finance his motorsport projects. Formula 1 remains an essential part of Ferrari’s advertising and marketing strategy which revolves around the iconic team’s presence and success in the top flight. They spend little, if anything, on above the line advertising. On this front, it is clear that Camilleri appears intent on following Marchionne’s stance on the future of Formula 1 and acknowledged, “There are ongoing talks with Liberty Media, I think there has been some progress on the technical side, but less so on budget cap and governance of the sport.”
We reported before Sergio Marchionne’s death that he had met with Formula 1 supremo Chase Carey and FIA president Jean Todt and after the meeting, it was understood that the parties were closing in on consensus.
But Camilleri is cautious if a tad cryptic, with regards to wholesale changes that may be on the horizon under Liberty Media, “I’m not so sure about new ideas, the goal is to divide the cake as it is, we’re not talking about how to increase it. I can bring my contribution to the table.”
The former Phillip Morris man also indicated that Ferrari will continue to be backed by Marlboro for the foreseeable future, “There is a contract until 2020. This is a relationship that has lasted for 45 years and has brought us mutual benefits. I believe it will continue this way.” Camilleri’s appointment also strengthens the hand of his former Marlboro colleague Maurizio Arrivabene, the pair worked together at PMI for two decades.
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