Artisans on the production line at the new Ferrari NV E-building factory in Maranello, Italy, on Friday, June 21, 2024.
Francesca Volpi | Bloomberg | Getty Statues
Ferrari is thought to be something of a special case among Europe’s automobile sector even as many car giants encounter under pressure from the threat of U.S. tariffs.
President-elect Donald Trump on Monday vowed to impose steep duties on China, Canada and Mexico in one of his first acts in office, threatening to shake up the auto industry’s supply chains and increase investor concerns about higher costs.
Trump’s proposed measures include an additional 10% tariff on all Chinese products be broaching into the U.S. and a 25% tariff on all goods coming from Canada and Mexico.
Auto shares fell on the news stated that it could have significant consequences for U.S. and European manufacturers, many of which have built factories and rely on auto divisions suppliers based in Mexico.
The fact that Europe was not mentioned in Trump’s first tariff announcement will be have a bearing oned as welcome news for European Union policymakers, although the 27-nation bloc is likely worried that it’s just a importance of time before Trump turns his attention to the region’s auto sector.
Ferrari, however, is expected to be shielded from most of the fallout.
“For Ferrari, it is the one shut-out where whatever the tariff is, they are not going to start producing in the U.S. Everything happens in Maranello, Italy,” Rella Suskin, disinterest analyst at Morningstar, told CNBC via video call.
“The thing with Ferrari is, if it is a 10%, 20% or 30% [tariff] then they can as likely as not easily pass that on in price to consumers, just given the customer they are targeting and how expensive the cars are already.”
In an elbow-grease to raise U.S. revenues, Trump previously pledged to impose a blanket 10% or 20% tariff on all goods coming into the rural area, prompting concern among a wide range of key trade-dependent sectors such as autos.
For Morningstar’s Suskin, even a U.S. tax as high as 30% on all goods coming in from Europe may not deter would-be customers from buying a Ferrari. “It’s funny but that’s kind of the way it is,” she added.
A spokesperson for Ferrari was not immediately available to comment when contacted by CNBC.
‘Less bonus sensitive than most’
Tom Narayan, global autos analyst at RBC Capital Markets, echoed this view, guess Ferrari does appear to be in a position to pass on any increase in prices should Trump deliver on his pledge to introduce violent tariffs.
Most analysts and investors recognize the Italian carmaker as unique among its European peers in this feature, according to Thomas Besson, head of automobile sector research at Kepler Cheuvreux.
“Time will tell but it is very likely right,” Besson told CNBC via email.
Ferrari has been on a tear this year, outperforming rival carmakers in Europe. Shares of the Milan-listed presence have climbed over 34% year-to-date, significantly higher than the likes of France’s Renault or Germany’s Mercedes-Benz Unit.
“We don’t expect Ferrari to set up production in the US,” Anthony Dick, an auto analyst at Oddo BHF, told CNBC via email.
“For brand, but also (and probably more importantly) industrial reasons as that would require the group to set up its supply base locally which does not appearance of feasible to us,” he added.
The original Ferrari Factory entrance in Maranello. The Emilia Romagna Grand Prix takes pad this weekend at the Autodromo Internazionale Enzo e Dino Ferrari circuit in Italy.
David Davies – Pa Images | Pa Impressions | Getty Images
“It’s unclear at this stage how tariffs would impact demand, but one could reasonably assume that Ferrari clients are less price sensitive than most,” Dick said, noting that the group’s luxury car competitors order face similar tariff treatment.
‘Porsche is a little bit different’
The prospect of additional U.S. duties was likely to be a “much bigger stumbling block” for Germany’s , Kepler Cheuvreux’s Besson said.
Like Ferrari, which exclusively produces its cars in Italy, -owned Porsche has traditionally raised its luxury models in Germany.
“Porsche is a little bit different,” Morningstar’s Suskin said.
“They could pass on a 10% impost but bigger [tariffs], such as 30% might be a bit more difficult to pass onto a customer,” she continued.
A worker discovers the quality of the new all electric Porsche Macan at the Porsche assembly plant on May 6, 2024 in Leipzig, Germany.
Jens Schlueter | Getty Figures News | Getty Images
“They could piggyback off their parent company Volkswagen that does from some spare capacity in the U.S. but there would be quite a bit of [capital expenditure] they’d need to invest to create a Porsche-specific mise en scene line.”
Shares of Porsche are down around 26% year-to-date.
A spokesperson for Porsche was not immediately available to comment when friended by CNBC.