By Ben Gilbert and David Rosenthal

The business of Ferrari looks simple: Make fast cars, and not too many of them.

On the surface, this strategy of scarcity and tantalizing exclusivity seems remarkably similar to the classic playbook of other storied luxury brands, as if Ferrari's cars are just Hermès bags and Rolex watches on four wheels.

But Ferrari has something that Hermès and Rolex could never cultivate: hordes of screaming fans who worship the brand from the time they can say vroom-vroom.

Few teenagers hang posters of Birkin bags in their bedrooms, but droves of them have the sight of F40s and Testarossas seared into their brains long before they can get behind the wheel. Despite selling a grand total of 330,000 cars over the course of its entire history, Ferrari boasts more than 400 million fans around the world. And no company has a higher ratio of people who know about its products to people who actually own those products.

Far from cheapening the brand, Ferrari's rabid base of superfans only enhances the brand's appeal to clients who can afford to pay millions of dollars for a car they will rarely drive.

As we learned when we spent hundreds of hours understanding the company's history and business strategy for our upcoming Acquired podcast, the genius of Ferrari is the way it has weaponized that set of Italian contradictions -- and bolted the business model of luxury onto a beloved professional sports franchise.

When Enzo Ferrari established his eponymous company in 1947, creating a luxury brand was the furthest thing from his mind. He was obsessed with building the world's fastest cars to conquer the booming world of auto racing. To do that, he also built a clever business model. Like many of his rivals, he built cars for his own racing team and sold them on the side.

But unlike Mercedes or Ford, whose racing garages and consumer car factories might as well have been located on different planets, the same Ferrari employees in the hills of Maranello, Italy, built substantially the same cars, whether they were selling them to customers or racing them at Le Mans.

The model created a beautiful feedback loop. Scuderia Ferrari's success in Grand Prix races stoked greater awareness and desire for private client road cars. The profits from those client sales fueled the research and development that turbocharged La Scuderia's performance back on the track.

It was a fantastic strategy through the 1950s and 1960s filled with F1 championships and notable clients. But by the time Enzo died in 1988, the business was struggling. After a 50% sale of the company to Fiat in 1969, Ferrari was losing money and furloughing workers due to a misguided strategy of overproduction. Even more unfathomable today is that cars were just sitting there at dealerships, waiting to be sold. Can you imagine? Ferraris that you could drive off the lot!

The company's future was very much in doubt when it found a savior in Enzo's one-time protégé, Luca di Montezemolo, a blue-eyed Italian aristocrat with the steady hand to pull off a U-turn at Ferrari.

Fifteen years earlier, Montezemolo was the young Ferrari team manager who had engineered the Prancing Horse's last run of Formula One dominance. To the tifosi in their unmistakable Ferrari red, he was so popular that he could've run for president of Italy. He left Ferrari in 1977, rising to chief executive of the drinks company Cinzano and organizing the 1990 World Cup in Italy. He had traveled the world and mingled with the elite by the time Fiat scion Gianni Agnelli brought him back to Maranello as chairman -- and gave him a specific mandate.

Rescue Ferrari by any means necessary.

The visionary Montezemolo saw immense potential lying in the wreckage of Ferrari's road-car business. Instead of positioning the product as a domesticated race car, he realized this was Ferrari's chance to sell something less tangible but infinitely more valuable: the fulfillment of every fan's childhood dreams.

Rather than driving off a lot, clients could fly to Italy and take their cars out for a rip around the test track that Michael Schumacher practiced on the day before. The interiors would be made of leather that rivaled Prada's. Unlike Ferrari's untamed beasts of old, you could enjoy driving them (somewhat) regularly without fear of breaking down on your way to the store. The engines could still rocket drivers to 200 miles an hour on a moment's notice -- but now they would be signed by the craftspeople who made them.

By pursuing this counterintuitive strategy, Montezemolo transformed Ferrari into a new kind of company -- like Hermès smashed together with Manchester United.

Other luxury brands manufacture desire through scarcity. Other sports teams benefit from shared emotional attachments. Ferrari does both. It breeds a mass fandom that somehow makes the company's most exclusive product even more valuable.

By 1997, the business had returned to meaningful profitability for the first time in years despite making fewer cars. Montezemolo slashed production from 4,561 cars when he arrived to just 2,289 two years later. Once he put his strategy into motion, Ferraris were no longer sitting around like Fords. Suddenly, there was a waiting list to buy them.

In the decades since then, it has become clear that Montezemolo's innovation dug a moat around the company that no competitor has been able to cross.

To this day, other racing teams may pass Ferrari on the track and other carmakers may challenge Ferrari on the road.

But no other business can offer luxury, maniacal fandom and nearly a century of unbroken sporting heritage, all rolled into a product that's rarely seen but instantly recognizable on any street in the world.

-- Acquired's full episode on Ferrari will be available in Apple Podcasts, Spotify or any podcast player starting on April 13.

(END) Dow Jones Newswires

April 10, 2026 11:49 ET (15:49 GMT)

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