By ALASTAIR SLOANE
The people at the Ferrari factory grieved for a long time after founder and patriarch Enzo Ferrari died in 1988.
He had ruled the company with absolute power and after his death the carmaker became defensive and inward-looking. It did not want to look to the future.
Only the past and the glory of Enzo mattered in a time of prolonged mourning.
But all that the autocrat accomplished in the marketplace took a back seat in 1991.
The largely leaderless carmaker was two-thirds of the way into a baffling production increase of 4500 cars when the worldwide recession hit. Sales crashed.
Going into a bleak 1992 forecast, Ferrari looked at what it had to offer. Production of the megaexpensive F40, the closest thing to a road-going racecar, was over. The 348 model was old-fashioned and finished and the 512 had not been selling well anyway.
It was time to restructure. The company's future in Formula One depended on it. Profits from its road cars then and now provide roughly half of its Formula One budget. Sponsors provide the rest.
Over 12 months Ferrari sold out to Fiat, hired a new chairman, Luca di Montezemolo, and put in place plans to:
* Build more desirable cars.
* Make them user-friendly.
* Attract everyday drivers.
* Trade on Ferrari tradition.
* Cut production to make the cars more exclusive.
* Improve efficiency at the Maranello factory.
* Provide worker incentives, linking quality with pay increases.
* Boost sales in Japan and Asia as a hedge against future recession.
"It was not something my father would have done," said Piero Ferrari, the company's 54-year-old vice-president, on a flying visit to Auckland.
"He loved engines. For him the engine was the heart of the car. But he was against the concept of user-friendly. He wanted his cars always to perform, certainly, but not in terms of today's mentality."
The structural changes have turned Ferrari around. "It was able to become more flexible," Mr Ferrari said. "We made a big effort to reduce expenses and to invest all the money available on a new product."
The carmaker is now building between 3000 and 4000 cars a year.
"We are always opening new markets, but it is better to retain Ferrari's exclusivity and sell a few cars all over the world than to make a lot and not sell them all."
Mr Ferrari owns 10 per cent of the company while Fiat owns 87 per cent and an investment group the remaining 3 per cent.
Ferrari turns the corner in drive for restructuring
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