New Delhi: Enrico Galliera, spent the first 20 years of his career with Italian pasta maker Barilla Holding SpA. His only job change happened in April 2010, when he took charge as the commercial and marketing director at Ferrari SpA, the legendary Italian sports car manufacturer. He was in India to open Ferrari’s first dealership in the country, located opposite the Jaguar Land Rover showroom in Janpath, New Delhi. Fourth in the pecking order in the firm, Galliera spoke about the challenges he anticipates and Ferrari’s future plans. Edited excerpts:
Is it because of the growing presence of luxury car makers that you decided to enter India?
The decision to enter India was taken a few years ago. In 2008, we decided to take a tour of India in order to learn more about India...opportunities in India. At that time we took the decision to arrive in India in 2011. The only point we wanted to make sure...was to find the right partner because we were just not looking for someone who was investing money..., but we were looking for someone who can represent our brand and become the ambassador of our brand. In that perspective, we will not be aggressive. We would just want to ship, show and deliver our product to the Indian customers.
Will Ferraris cope with Indian roads?
Have you ever driven in New York, Rome or Eastern Rome? I think the life is chaotic on the roads everywhere in the world. It is true that in some countries there are some infrastructure that are more developed. But we believe that there is going to be some development even in India. This will allow the people to drive their car. Together with the development of the circuits like GP (Grand prix), which are going to be open in November or December. These are some of the environments where people can enjoy driving their cars—both racing or driving their cars. Our cars are sports cars, but those can be used everyday like a normal car. When it comes to Ferrari, it cannot be just about the speed. Even at 20km per hour you can have a great time.
Brand Ferrari excites everybody. With the growing number of rich people in india, how are you going to preserve the exclusivity of the brand in the country?
The exclusivity is given by the approach to the market. This means that we are not selling on discount, we are not pushing our cars into the market. We are just delivering the car, which is needed in the market and always being careful as we like to say… to deliver one less car than the demand in order to keep the demand high, in order to keep this exclusivity. In the US, which is our biggest market, we sell close to 2,000 cars per year and it is very exclusive because demand over there is very high. So, the same thing will happen in India. We will deliver the car according to the demand in the market. But we’ll follow our motto of keeping supply below demand.
What kind of demand do you expect from the Indian market?
This is a nice question. I would like to have the crystal ball to understand what is going to be the potential. We will discover it together with Mr (Ashish) Chordia (chairman of Shreyans Group, the official importer of Ferrari cars in India) in the coming months. Our target in the next three years is to at least arrive to a three digit number…so something around a hundred cars. But if the opportunity is there, we will follow it. It is (a) learning by doing process that we will have to put in place here.
Globally, your business took a serious hit during the economic crisis. How is the situation right now?
Well let us say that during the crisis, Ferrari probably was one of the companies less impacted as compared to others. That is simply because of our business model. We normally have, on average, 12 months wait list. So whenever there is a problem, we still have some room or space.
Ferrari is recovering well from the global crisis of 2008-09 and last year more than 100 Ferraris were delivered in South Africa. That was the record year for the company. We delivered more than 6,500 cars. This year, we plan to beat this record. So, everything is progressing very well.
The company is concerned about Japan and how long it will take for such an important market to recover. However, things have worsened after the recent tsunami there. Unrest in several Middle-Eastern countries are a concern for the company. Far East countries are expected to become the second most important market after the US in the coming future.
How are the other developing markets?
All the countries are profitable. We try to deliver in a market when we believe there is a dimension that is able to bear the cost. Otherwise, we prefer to stay out. Now we are in 58 countries and we have a long list of countries that are willing to have a representation of Ferrari. But we are very careful of making sure that the investments pay off well.
South Africa has come up as an important market for Ferrari and is already among the top 15 out of the 59 countries. We are looking to expand into other African countries in future. At present, we have owners in countries like Mozambique, Angola and Nigeria who have their cars serviced out of South Africa.
China is a successful country for us. We went to China in 2004. The first three-four years were taken to better understand the country. Last year, we grew at 40%. We are selling around 300 cars there. Now we are at the incredible position in the country.
Indians are willing to pay a price, but only if they think the product is worth that much. Do you also get that impression?
I cannot exactly comment about the Indian market. I would say that throughout the world, the economic meltdown created a new environment where people who are willing to pay heavily for capital goods are looking more at the value of the product before making any investments. So, this is a general statement across the world. So, probably it is going to be the same in India. So, the key is going to be simple, that is to develop and deliver outstanding superior products. And that is what Ferrari tries to do. We think that there is a continuous improvement as each car is better than the best one and we are working continuously to make it better. That’s the key… difficult to be done, but a very simple key. If you are with a good product which can give the right emotion to the people who can drive, people will buy.
How is your strategy shaping up with Formula 1 coming to India?
F1 and general racing activities are our marketing platforms. So during any event, we try to organize around the F1 GP a list of activities where we try to involve our best customers in order to let them feel the passion of being part of Ferrari. We will do the same in India. We are working on the specific programme. Normally, we try to bring our customer close to the race, close to the box, close to our pilots to let them feel the emotion of a GP.
What is the next big thing to happen at Ferrari?
We are getting requests from dealers in countries such as Japan and the US for cars that produce fewer emissions and use less fuel. We are looking at all the various fuel saving and emission-less technologies in the world and will adopt them when they meet our specific requirements.