Ferrari NA Wants To Block Gray Imports
19.8.01

The following article appeared in the current issue of AutoWeek magazine, written by Bob Gritzinger:

What makes a foreign Ferrari different from a U.S. model? It depends on whom you ask.

Importers of so-called gray market Ferraris say the expensive supercars today are "world cars" built for a global marketplace. They say a Ferrari intended for sale outside the States is capable of meeting, with only a handful of modifications, tougher U.S. safety and emissions standards. "I would think there is no reason a European car can't be imported to the U.S.," said Dick Fritz, who's been bringing in gray market cars for 25 years through his company, Amerispec, in Danbury, Connecticut.

In the past, Ferrari hasn't taken issue with gray market importers. The company filed only limited objections and almost looked the other way as European-specification cars have been brought into the States and "federalized" for crash safety and emissions standards.

All that changed in late June when Ferrari took the unprecedented step of asking the U.S. Department of Transportation to halt importation of 2001 model Ferrari 360 Modenas and 550 Maranellos until the company could prepare its objections. On Aug. 10, the final day for public comment on the issue, Ferrari filed a six-page response--with promises of reams of additional technical documentation to follow--stating gray market imports differ from their U.S. counterparts in hundreds of ways and cannot be readily modified to meet U.S. requirements. In effect, for the first time ever, Ferrari is asking the federal government to deny the importation of Ferraris not originally intended for the United States.

David Wertheim, vice president and general counsel for Ferrari North America, said the petition filed with the DOT states that Ferrari believes 234 parts, with a suggested retail price of $56,584, are required to bring a non-U.S. 2001 model 550 into federal compliance. A total of 306 parts with a retail cost of $68,021 are needed for a 2001 model 360, Ferrari states.

As a result, Ferrari has serious reservations whether modifications to non- U.S.-spec cars proposed by importers are sufficient to meet U.S. safety and emissions requirements, said Stuart Robinson, president and CEO of Ferrari North America. "[Ferraris] are not world cars--they are substantially different from U.S. cars," said Robinson.

Wertheim admitted all the parts listed don't specifically relate to safety or emissions, but are included on U.S.-spec cars that Ferrari crash tested to meet federal standards. As such, Ferrari believes the parts must be included to make a gray market car compatible to a U.S. model. "It's impossible to say that these cars are substantially similar with hundreds of different parts," said Wertheim.

Ferrari also takes issue with some proposed modifications. For instance, the importer's petition states doors on all 550s are identical, but doors on non-U.S. cars aren't fitted with side-impact protection bars, Wertheim said. "We have some serious safety concerns, and ultimately at the end of the day, it's the Ferrari name that's on the car," said Wertheim.

Some importers, alarmed at the ugly turn of events foreshadowed by Ferrari's request for an extension of the public comment period in June, have been feverishly working to fight any limits on the free market flow of Ferraris. In a letter to his congressman, Doug Pirrone, president of Berlinetta Motorcars in Huntington, New York, alleges Ferrari's goal is "to control the market, insure a monolopy, fix the prices and eliminate all competition." Pirrone's letter alleges Ferrari obtained a court order banning the importation of non-U.S.-spec Ferraris, and that Ferrari planned to say aluminum used to produce European and U.S. 360 chassis differed, making the European model unsafe for U.S. use.

There is no court order, and Ferrari is not making a claim that chassis differ between the European and U.S.-market 360s. Still, Pirrone's concerns about Ferrari's attempts to limit free trade have some foundation. Earlier this year, the company informed potential buyers of its limited-production $258,000 550 Barchetta they would be required to sign an agreement prohibiting them from reselling the car to anyone but their Ferrari dealer within the first year of ownership (AW, April 2). Ferrari said the contracts, which prevent buyers from reselling their cars at a profit on the open market, are intended to prevent speculation in the exotic cars.

For Pirrone, "it's just one abuse after another."

Gary Roberts, a Costa Mesa, California-based importer, said with the gray market on the wane, Ferrari's "control freaks" ought to cooperate with importers and let the free market take care of itself. "It's bad show from Ferrari."

But Ferrari's Robinson said free trade isn't the paramount issue-- protecting Ferrari and its customers is what's important. He said gray imports have no effect on profits for Ferrari's U.S. dealers, but do affect the company's reputation. "This is not a covert way of addressing gray importers," he said. "This is just a way of informing the proper authorities of our concerns."

Click here to return to the Ferrari Happenings page.