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Ferrari's China Sales Tumble

Tyler Durden's picture




 

Despite briefly dipping below its $52/share IPO price yesterday, moments ago Ferrari pleasantly surprised supercar fanatics when it reported record Q3 performance, highlighting that shipments were 1,949 units, up 21%, revenues were up 9% to €723 million, EBITDA of €214 million, up 34%, leaving to a 62% jump in net profit of €94 million.

One skim of the press release confirms that while the global middle class is slowly being gutted, the top of the wealth pyramid has never had it better: The increase in EBIT "was supported by a slightly positive mix effect due to higher sales of our limited edition supercar LaFerrari and special racing car FXX K."

At least the world's billionaires have good taste.

The tersely worded press release of the new public company also provided full year guidance that saw the business continuing to boom, expecting shipments: 7.7K including limited edition supercar LaFerrari, with Adjusted EBITDA on the €725 million – €745 million range.

Overall, a great quarter.

There was just one problem: Ferrari announced that while sales across the rest of the world were solid, rising by 114 and 159 units in Europe and America, to 815 and 682 units respectively, unexpectedly sales in China tumbled by 24% in the third quarter, or down 50 units Y/Y to 157.

 

And while we have no reason to doubt Ferrari's optimistic outlook - after all, the only thing better for the world's richest than ZIRP is NIRP (coupled with a few more QE expansions here and there), China's unexplained tumble is very disturbing, and should lead to questions about just how strong even the wealthiest Chinese consumers truly are.

It appears investors finally read Ferrari's results...

 

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Wed, 10/28/2015 - 09:40 | 6720572 Takeaction2
Takeaction2's picture

This is the easiest short around...Really? Ferrari?  Gold and Silver just popped...wonder what's up? NOTE...this Halloween make the kids smile..give out full size candy and watch the smiles.  It is amazing.  Don't give that little garbage. 35 years ago..I still remember the house that gave out full packs of Bubble yum!  NO smarties..Yuck.  LOL

Wed, 10/28/2015 - 10:24 | 6720776 GMadScientist
GMadScientist's picture

Long 'Great Wall' and rickshaws.

Wed, 10/28/2015 - 10:29 | 6720812 doctor10
doctor10's picture

didn't they just float an IPO or sumpin?!!

funny how that works-and some "investment bank" somewhere lets them get away with that shit!!

Wed, 10/28/2015 - 10:46 | 6720925 Ham-bone
Ham-bone's picture

China's version of subprime meltdown in the CRE space dead ahead.

 

  • In the '14-'16 period, China's shopping centers are planned to grow by 80% (square meters) over existing retail footprint plus account for 62% of global growth.
  •  China's core 15-64yr/old population will peak in 2015 and begin a multi-decade decline in 2016.
  • China's housing fueled credit bubble rose from $3.5 T ('03) to $28 T ('14) but the rate of growth is likely slowing precipitously.
  • The migration of shopping from brick and mortar to online (likes of Alibaba) is sure to increasingly pull significant revenue away from these stores.
  • With fewer total shoppers, slowing credit growth, and a shift to online shopping, where will the business come from to fill the near doubling of china's shopping centers???

http://econimica.blogspot.com/2015/10/explosion-of-china-shopping-centers-for.html

Wed, 10/28/2015 - 09:38 | 6720576 Majestic12
Majestic12's picture

"Ferrari's China Sales Tumble"

I really feel sorry for billionaires....

Its just no fun for them anymore...everyone is poor and destitute, and there is nobody left to beat down and splash mud at as they race their Ferraris down the street.... :(

Wed, 10/28/2015 - 09:57 | 6720655 pods
pods's picture

China?  

They probably realized that nobody can see you driving anyways due to the small, ummm, smog problem.

pods

Wed, 10/28/2015 - 10:31 | 6720819 Majestic12
Majestic12's picture

"see you driving"

"you say Asian driver bad? I see fine, round eye!"

Wed, 10/28/2015 - 10:28 | 6720803 alphahammer
alphahammer's picture

 

Wait, YOU'RE not a billionaire?

I thought everyone at ZH was a billionaire! 

Wed, 10/28/2015 - 09:39 | 6720577 BlindMonkey
BlindMonkey's picture

Clearly CAT's problem stems from not having a super exclusive model.  I am beseeching the CAT board to greenlight my suggestion of the "LaD9" immediately.

Wed, 10/28/2015 - 09:40 | 6720579 Majestic12
Majestic12's picture

""LaD9" immediately."

I don't know...maybe an LaD9...GT?

Wed, 10/28/2015 - 09:42 | 6720594 NoDebt
NoDebt's picture

LaD9 GT California.  And put it in a new Ferris Bueller movie.

Wed, 10/28/2015 - 10:29 | 6720809 Majestic12
Majestic12's picture

"LaD9 GT California"

LaD9 GT California...Kowalski version...now you're talkin'...

Wed, 10/28/2015 - 09:40 | 6720582 NoDebt
NoDebt's picture

When China finally realize that they wouldn't have an economy without corruption, they'll drop all this stupid anti-corruption stuff, start mandating the construction of more Ghost Cities and everything will be fine again.

Wed, 10/28/2015 - 09:45 | 6720602 Dr. Engali
Dr. Engali's picture

Exactly. Everything was going fine until those damn sheep started getting restless. What China needs is better teevee programming and moar fluoride in the water.

Wed, 10/28/2015 - 09:59 | 6720667 css1971
css1971's picture

LOL. No. You misunderstand the anti-corruption stuff.

You think the Chinese communist party as one big group of people who all think the one way... No.

The chinese communist party is made up of dozens of "bosses" who have alliances and agreements with each other. It's more like a gang than a party. Or better, several gangs under one headline. The anti-corruption stuff is simply an excuse for one set of bosses to get rid of other competing sets of bosses and take over their business.

The only difference between that and the US party system is the gangs in the Chinese system don't have official names like the Republican party or the Democratic party; maybe Xi Jinping's gang, Jiang Zemin's gang etc. Like the US system it has little to do with beliefs or ideals and everything to do with money and power.

Wed, 10/28/2015 - 11:10 | 6721078 laomei
laomei's picture

China has always been about warlords and patonage, that's never changed.  The great anti-warlord campaign, in the end just ended up making them into generals.  When the Japanese came, if they didn't like their current benefits they sold out immediately.  It's a loose confederation of warlords pretending to be a party.  Xi's a moron though, he's not fit for the position in any way and has no idea what he is doing.  He knows he needs to consolidate power and that's about it, his understanding of how things actually work is rather broken.   Essentially he's on path to be as bad as mao was, he's pushing an agenda that won't be realized and he will blame everyone he can find when it fails.

Wed, 10/28/2015 - 09:41 | 6720590 Magnum
Magnum's picture

Ferrari doesn't make cars suitable for Chinese roads.

Wed, 10/28/2015 - 09:44 | 6720600 NoDebt
NoDebt's picture

Sure they do.  You just can't get it over the curb at the end of your driveway to get it onto that road.

Wed, 10/28/2015 - 10:11 | 6720716 MopWater
MopWater's picture

Isn't that why you hire a half dozen country folk to carry your car across the curbing?

Wed, 10/28/2015 - 10:25 | 6720780 GMadScientist
GMadScientist's picture

I'm sure the committee will put it that way, but it's more about China making roads so shitty no car should drive on them.

Wed, 10/28/2015 - 10:34 | 6720838 Majestic12
Majestic12's picture

"China making roads so shitty no car should drive on them."

They need more bamboo...my floor is smooth and stellar!

Wed, 10/28/2015 - 11:15 | 6721106 laomei
laomei's picture

Not true. Well, at first anyways. China actually builds roads quite well.  The surface is at least.  They cheat on the roadbeds because well... no one's gonna inspect that.  As such, the drainage is crap and they get sinkhole problems.  The upkeep is also crap and any moron can come and tear up patches of road for whatever purpose and use the cheapest method possible to "repair" the damage.  So they start out ok, and go to shit in a hurry.

 

The highways though, those are done rather nicely, no major complaints there.

Wed, 10/28/2015 - 09:41 | 6720591 Dr. Engali
Dr. Engali's picture

I look forward to the day when Janet makes me a trillionaire so I can buy me a fleet of Ferraries with all my FRNs.

Wed, 10/28/2015 - 09:43 | 6720599 MadVladtheconquerer
MadVladtheconquerer's picture

Wow!!!  50 cars less in one region vs net +223 cars overall.  The end of the world.

What I want to know is when are my shorts going to start working. 

Wed, 10/28/2015 - 09:45 | 6720611 venturen
venturen's picture

RACE to the bottom! There is always a peak event.

Wed, 10/28/2015 - 10:24 | 6720774 alphahammer
alphahammer's picture

 

Read that.  Mentioned Ferrari nowhere.

 

Wed, 10/28/2015 - 10:28 | 6720798 GMadScientist
GMadScientist's picture

Gov and industry working together, fascism defined.

Wed, 10/28/2015 - 10:53 | 6720988 gladih8r
gladih8r's picture

That's funny.  They called it a Cyber "Security" bill.  That's kind of like agreeing to a company's "Privacy" Policy before using their NSAware infested crap.

Wed, 10/28/2015 - 09:53 | 6720641 Spungo
Spungo's picture

Maybe rich people finally realized that sitting in bumper to bumper traffic sucks regardless of what car you're driving.

Wed, 10/28/2015 - 10:03 | 6720684 carneades_jazz_hands
carneades_jazz_hands's picture

They bought the new iPhone instead

Wed, 10/28/2015 - 10:31 | 6720820 yellowsub
yellowsub's picture

Don't forget they have those anti-graft rules now, you literally don't want to be caught dead in a Ferrari these days there.

Wed, 10/28/2015 - 11:15 | 6721103 fowlerja
fowlerja's picture

I don't understand why China sales are down...in their ghost cities...you can drive whatever speed you want...a Ferrari would be an excellent car...ok just received a call from my Chinese friend...he said there were next to none ferrari maintenance facilities in the country and the Chinese rich refuse to use "jiffy lube" to maintain their cars...something about saving face...ok...case closed

Wed, 10/28/2015 - 11:22 | 6721150 yogibear
yogibear's picture

Not in the US. Many Wall Street people will buy with their large year-end bonuses.

Wed, 10/28/2015 - 11:34 | 6721209 ThrowAwayYourTV
ThrowAwayYourTV's picture

The dumbest thing I ever see is people driving around in these things where the speed limits are 35 and 40 MPH. I mean, whats the point?

Is it just to show everyone how stupid they are?

Wed, 10/28/2015 - 12:06 | 6721401 DrZipp
DrZipp's picture

All the rich Chinese have snuck their money out and are sinking it into real estate in the Bay Area.  Ferrari sales in California will spike in the next year.

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