Capital Calls: Ferrari lowers bar for next CEO

(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)

Ferrari Roma is unveiled during its first world presentation in Rome, Italy, November 14, 2019.

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PIT STOP. Ferrari is smoothing the path for its next driver. The maker of $215,000 sports cars delayed its 2022 financial targets by a year, dragging shares down 6%. It now predicts it will take until 2023 for annual EBITDA to reach between 1.8 billion euros and 2 billion euros. This contrasts with estimates-beating first-quarter core earnings of 376 million euros and an order book at record levels.

Ferrari blamed the protracted Covid-19 emergency for the change in guidance. The group currently run by Agnelli family scion John Elkann after the surprise departure of Louis Camilleri last year will likely push investment earmarked for 2020 into this year and the next, boosting costs. And it’s not immune to a global chip shortage. To counter the impact, Ferrari could draw from its waiting list and sell more cars. But that would dent its scarcity value. By disappointing shareholders now, chairman and acting chief executive Elkann will at least make it easier for his successor to have a safer start. (By Lisa Jucca)

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