Ferrari’s $640,000 EV Is Quite a Stretch

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2:00Shares of Ferrari did not fare as well as shares of Micron today. Ferrari shares fell in Italy at more than 9%. This after critics panned the look of its first fully electric vehicle. It was a setback for the Italian supercar makers' controversial push into EVs. You just spoke about this on the simulcast. You said that influencers, too, were pushing back on, what did they say it looked like?

2:20Carol Massar:Yeah, everyone was insulting this car, but it wasn't even an influencer. It was actually an analyst that said that it looked like a combination of a Honda Accord and a Tesla 3. All right, we'll see what Hannah Elliott has to say about this. She's Bloomberg Pursuit staff writer and car critic. She's the co-host of the Hot Pursuit podcast. Sometimes Matt Miller joins her, but we want to talk to Hannah about this new Ferrari. First of all, hey, you get to drive all the cars. Are you going to get to drive this thing? Yes, I fully anticipate and look forward to driving it toward the end of the year.

2:49I'm told probably December, so fingers crossed. I'm calling Ferrari every day saying, when can I drive it? And this is the type of thing, you'd fly to Italy to do this, or would they bring it to the U.S.? Wherever they do the launch, I will meet them wherever in the world I need to go to drive the thing. Sometimes it's Italy, sometimes it's somewhere nice during the winter, like maybe Spain, a track in Spain would be good. Yeah, I've also seen some great stories you've done from South Africa in the past. You don't have a bad gig, Hannah Elliott. it. I'm not going to. Someone's got to do it. So we thank you.

3:22So why is everybody so mad at Ferrari for this? Here's the thing. If this was Lucid or Tesla that had come out with this car, I think people would be a lot happier with it. The problem is that this is Ferrari. This is the company known for the height of sophistication and beauty and elegance. And it's Italian. It's handmade. It's handcrafted. And so to come out with something that looks like a computer mouse, if you can remember back in the day, we used mouses, is really an affront to the Tafosi. That's the name for people who love Ferrari. It's sacrilege to the religion that Enzo Ferrari created.

4:07And let's not forget, Enzo famously said, I don't make cars, I make engines. So the fact that this is an EV, It's obviously been made to optimize efficiency. It's just an affront to the people who love Ferrari for what it used to be and for what it has been.

4:26Carol Massar:Hannah, as you mentioned to your point, the elegance that is associated with Ferrari and, of course, its cool exhaust sounds are the big part of the appeal for car lovers. Why then do investors care at all what its EV vehicle looks like? Well, that's a really very good question because at the end of the day, this is a compliance car. Ferrari made this car so that they will meet emissions and other regulations in Europe and globally, and they can keep making the other cars that everybody loves to drive that feel like tangible experiences. So at the end of the day, it kind of doesn't matter if investors or buyers like this car or don't like it.

5:07They only need a small group of people, probably in Asia or the Middle East, to buy it. And then they can keep making the cars that everyone loves to look at. So that's kind of the funny thing. At the end of the day, it doesn't really matter. But the backlash is pretty bad. I mean, there's been a lot of weeping and gnashing of teeth. So that's the slight risk. Is Ferrari somehow selling its soul? We'll see. Time will tell. $640 ,000, 550 ,000 euros is the price of the Ferrari. Luce, am I saying it right, or Luce? What is it? Luce, the Luce. Okay, thank you. Thank you for the quick Italian lesson, Hannah.

5:44The question about what separates one EV from another EV, I think is a really important one. It makes sense, like you said. Ferrari always said that he built engines, not cars. And the engine, those are something to behold when it comes to Ferrari, when it comes to other supercar manufacturers as well. And there are differences between those engines. But we're talking about a motor here. And I will never forget the first time I was ever in an electric vehicle, and I felt the acceleration. And it's just remarkable. And you can find a relatively inexpensive EV that you could buy for less than 10 % of the cost of this that could probably hold its own in a zero to 60 with this car.

6:25Does that mean that when it comes to EVs, like, these things are now commodities? Yes. The short answer to your question is yes. This has been a big problem for the European brands in China because China is routinely making EVs that have the same or better performance numbers for a fraction of the cost for, you know, 50, 60,$70 ,000 compared to 640 ,000. And the performance and the technology and the AI are as good, if not better. So yes, it's a huge problem when everything starts to be able to be plugged in and it's just run on batteries. That is why people start to call these things appliances, because it becomes very difficult to distinguish one plug-in appliance from another plug-in.

7:15And I predict this will actually send the secondary market for Ferraris even higher. It's already really high. I predict any Ferraris with combustion engines, any Ferraris with manuals will even gain more value as we see more of these roll out.

7:31Carol Massar:Hannah, do you have a sense yet of who is going to be buying these cars? Is it going to be competing directly with the Teslas of the world? I believe that this car is made for people in Asia primarily and for people very interested in tech. if a Tesla buyer or Tesla owner could afford this vehicle, then yeah, there might be some crossover. But again, this goes back to like how crazy expensive this Ferrari is. Teslas can be had for, you know,$100 ,000. This is so many more times more expensive that ideologically it might be the same buyer. But on a fundamental, like practical basis, I think this buyer is going to be maybe strong-armed into buying the Luce with the promise that, okay, if you buy this Luce, now we'll give you first dibs on the Ferrari that you really want.

8:29Let's not forget, this is Ferrari's business model. They're very good about convincing people. Wait, wait, wait, remind us. I was just going to bring this up and I'm so glad you did. So you can't just simply walk in and buy the Ferrari you want. No, this is like trying to get a Birkin bag or a very rare Rolex watch. You must be given the opportunity to buy these things and how you are given the opportunity is you buy a lot of them. You buy the ones that you don't want so you can have the opportunity to get the one that you actually do prefer. So I predict that Ferrari gets a small amount of people to raise their hand, buy the Luce with the promise that, okay, if you take this one, we'll put you high on the list for the Ferrari that you really want.

9:13And that's probably going to be a combustion or at best a hybrid Ferrari. How much is the Ferrari that I really want? I don't know,$300 ,000. Okay, so less than the Luce. Sure, less than the Luce. I mean, personally, I love the Roma. I love the Amalfi. These are like these beautiful old world Ferraris that are exquisite. Well, Hannah Elliott, you do an exquisite job when it comes to doing the hard work of traveling around the world and writing incredibly great stories and doing great videos about cars.

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