Maserati Hopes Its Profits Will Increase Once Levante Out
Maserati has been passed from owner to owner so many times over the years that at certain points it would have been reasonable to expect to find it at a garage sale. But under Fiat ownership, the company briefly seemed to have turned around, with last year being the automakers best sales year in its 100-year history. And now profits are already falling again, down by a whopping 30 percent so far from last year. This is partly due to falling sales, which are down 13 percent, but also because many of those who would have bought the more expensive 2014-2015 Maserati Quattroporte flagship sedan are now instead opting for the cheaper 2014-2015 Maserati Ghibli. Imported luxury car sales are down in China as well, although this is not a uniquely Maserati problem.
FCA CEO Sergio Marchionne has placed his faith in the upcoming 2016 Maserati Levante, saying that the company will return to profitability once the SUV hits showrooms early next year. There is quite a good chance that this is true, and there is certainly a precedent for it, but FCA investors are worried. This is a pretty major stumbling block for Maserati to hit so early on in its revival, and it doesn’t bode well for the upcoming Alfa Romeo revival.
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Why it matters
As painful as it is sometimes for people to admit, SUVs are good business for sports car makers. Not only do they attract a whole new segment of customers, but they also return a much better profit margin. For example, the upcoming Levante is built on the same platform as the Ghibli, but while the Ghibli starts at 68,000 euros in its home market, the Levante is expected to start somewhere north of 100,000 euros. This will go some way toward correcting the problem of Maserati buyers opting for cheaper cars, and very likely will actually fix Maserati’s profitability problem. That said, it will only be a temporary fix, and Maserati will need a better long-term plan if sales in China don’t improve.
You can read our speculative review here.
Source: Automotive News