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Japan
Loves Ferrari Again
The following article written by Alexandra Harney was published in
the Financial Times of
3rd September: Click here to return to the Ferrari
Happenings page.
6.9.00
Japan Ferrari Sales rise 10%
After nearly a decade's hiatus, Japan has rekindled its love affair
with the Ferrari. The favourite of well-heeled businessmen in the bubble
economy of the 1980s, the Italian sports car has become the vehicle
of choice for Japan's freshman class of internet entrepreneurs.
Sales of Ferraris were up nearly 10 per cent to 499 in 1999 and are
expected to rise even further this year. But industry executives say
that this is only the beginning. With dealers inundated with orders,
and investment bankers' calendars packed with internet-related IPOs,
the waiting list for a new Ferrari in Tokyo these days is nearly one
year long.
"Things are definitely changing. Ninety-nine per cent of our customers
used to be older guys, mainly self-employed businessmen, but we are
seeing a lot more young internet executives these days," says Makoto
Komatsu, head of planning at Cornes, Japan's largest luxury automobile
importer.
The most popular model for these 20- and 30-somethings is the Ferrari
360, which sells for between Y16.5m and Y18.4m ($172,800). Mr Komatsu
says the car's low-slung, curvaceous appearance - which looks strikingly
similar to some Japanese sports cars - has struck a chord deep within
the salaryman psyche.
"Japanese people have always bought Ferraris to show off their success,"
he says. Sales of other luxury vehicles such as Bentleys and Rolls Royce
have not really taken off, he adds.
The appeal is understandable. Japan's internet entrepreneurs, many of
them drop-outs from big traditional companies and investment banks,
are eager to stand out. And after years of gloomy economic forecasts
and tales of woe from long-suffering senior executives ousted in the
latest round of corporate cost cuts, the Ferrari offers an exuberant
if slightly cheeky expression of wealth.
This lavish spending has alarmed some older internet executives, who
point out that a shiny, almost invariably red, Ferrari does not endear
a new president to his employees or shareholders.
But the entrepreneurs' optimism has not escaped the notice of financial
analysts. Michael Naldrett, economist at Dresdner Kleinwort Benson,
has created a Ferrari index that tracks vehicle sales against consumer
confidence and consumption levels. His conclusion is that the Japanese
economy is well on its way to recovery: "If consumption is going to
pick up, it is going to be those with discretionary income. Ferrari
sales are indicative of what people with discretionary income are doing
with their money."
True enough, but the jury is still out on how ordinary employees are
spending their paychecks. "The type of people buying these cars is still
pretty limited," says Mr Komatsu. "The quality of the average salaryman's
life hasn't changed that much. But you still can't deny that this is
a sign the economy is improving."
