By Eric Sylvers
MILAN -- Ferrari NV hired a top executive from the semiconductor industry as its new CEO, as car makers focus on microchips and digital technologies that increasingly control everything from brakes to entertainment systems.
Benedetto Vigna, 52, will take over at Ferrari on Sept. 1. Until then, John Elkann, the company's chairman, will continue as interim chief executive. Mr. Vigna is currently a divisional president at French-Italian semiconductor manufacturer STMicroelectronics NV, where he has worked for more than 25 years.
In announcing the appointment, Mr. Elkann cited Mr. Vigna's "deep understanding of the technologies driving much of the change in our industry."
The global chip shortage that has led to production delays in the auto industry is expected to continue for months to come. That has called into question the auto sector's rebound as the severity of the coronavirus pandemic recedes in many countries.
The pandemic's economic fallout has hit orders for Ferraris and other luxury cars. Ferrari issued a profit warning in May, saying that because of the pandemic it wouldn't meet profit targets it had set for next year. The company pushed back the target to 2023.
Despite the setback, Ferrari has weathered the Covid-19 storm better than most of its peers. While car sales, revenue and profit fell last year, the company still reported a 21% operating margin after stripping out one-time items. That compares with 7.9% for General Motors Co. Ford Motor Co. posted a loss last year. While Ferrari's profit margin was consistently above 20% before the pandemic, most car makers have struggled to exceed 10% in the best of times.
Ferrari's Italian-traded shares are down almost 20% this year, though the stock is still trading more than four times higher than five years ago.
Mr. Vigna will be tasked with charting Ferrari's path toward electrification. The shift is consuming the energy of the entire industry, but it is a particularly pressing issue for Ferrari, which has long distinguished itself through its powerful motors. It isn't yet clear how successfully it can shift to a new-look auto industry, where batteries and computer code supplant the internal combustion motor.
The first plug-in hybrid Ferrari is on sale -- subject to a waiting list as with all models -- and the company has promised its first all-electric vehicle in 2025.
Also on Mr. Vigna's to-do list will be righting Ferrari's Formula One team, which hasn't won a championship since 2008 or an individual race since September 2019.
Mr. Vigna follows on the heels of Louis Camilleri, who ran Ferrari starting in July 2018 following the sudden death of Sergio Marchionne, who was CEO of both the fabled sports car maker and the former Fiat Chrysler group, now part of Stellantis NV.
Mr. Camilleri, a former tobacco executive who also had no car-industry experience, stepped down in December 2020 following a bout of Covid-19. He had a successful run at the helm, boosting Ferrari's sales and profit until the pandemic upended the auto industry.
Many analysts had expected Ferrari to appoint an executive with experience in the luxury-goods industry as the auto maker works to expand its brand beyond cars into products such as apparel and leather accessories.
In his years running Ferrari, Mr. Marchionne successfully pitched it to investors as a luxury-goods company that should be valued in a similar way to the likes of Hermès International SA and LVMH Moët Hennessy Louis Vuitton SE. That has allowed Ferrari to achieve a market capitalization of 35 billion euros, equivalent to about $42.6 billion, many times that of some mass-market car makers with bigger operations.
Write to Eric Sylvers at firstname.lastname@example.org
(END) Dow Jones Newswires