Ferrari to Cut Jobs, Idle Plants on Lower Orders (Update1)
May 11, 2010, 1:00 PM EDT
By Sara Gay Forden and Tommaso Ebhardt
May 11 (Bloomberg) -- Ferrari SpA, the maker of $228,000 California supercars, is seeking to idle production and eliminate 9 percent of its workforce after sister brand Maserati reduced orders for engines.
Workers walked out for four hours today because Ferrari wants to eliminate 120 office positions and 150 factory jobs in exchange for the last payment of a 2009 bonus due last month, CGIL union official Giordano Fiorani said today in a telephone interview. The sports-car maker employs about 3,000 people.
Ferrari, Fiat SpA’s most profitable brand, plans to idle a factory in Maranello, Italy, by laying off about 600 workers for a week starting May 17, Fiorani said. Ferrari is scaling back because of fewer orders from Fiat’s Maserati brand, for which Ferrari makes engines, said Ferrari spokesman Stefano Lai, who confirmed the plans to cut jobs and idle production.
“Even though Ferrari’s margins are very high, they wanted to do better,” said Massimo Vecchio, an automotive analyst at Mediobanca SpA in Milan. “The recovery is moving very slowly.”
Ferrari is slashing 2010 production targets to 11,000 vehicles from 20,000, Fiorani said. Ferrari never planned to make 20,000 cars this year and will maintain production at about 6,000 vehicles, similar to last year’s output, Lai said.
The company intends to outsource some jobs to local companies and offer some employees early retirement, Lai said.
Ferrari made engines for about 4,500 Maseratis last year, down from almost 9,000 in 2008. Lai declined to say how many Maserati engines will be made this year.
Ferrari’s first-quarter trading profit declined 28 percent to 39 million euros ($50 million), the company said April 21. Sales of the new F458 model, which is priced at 197,000 euros, provided a limited contribution in the period, the company said. Trading profit for 2009 fell 30 percent to 238 million euros as sales dropped 7.4 percent to 1.8 billion euros. Ferrari sold 6,294 cars last year.
“Ferrari has proposed to pay the bonuses if we accept the job cuts,” Fiorani said. “We are ready to discuss layoffs and reorganization, as there is a real cut in production, but we don’t understand their rigidity.”
Turin, Italy-based Fiat rose 21 cents, or 2.3 percent, to 9.53 euros at the close of trading in Milan. The stock is down 7 percent this year, valuing the carmaker at 11.2 billion euros.
--Editors: David Risser, Kenneth Wong
To contact the reporters on this story: Sara Gay Forden in Turin, Italy, via [email protected]
; Tommaso Ebhardt at [email protected]
To contact the editor responsible for this story: Kenneth Wong at [email protected]