Specialist
Former VP at Aston Martin
Agenda
- Lamborghini’s (ETR: NSU) volume and price outlook by model, highlighting regional nuances and dealership strengths
- Success of Urus SUV model and Lamborghini’s ability to sustain volume levels in the increasingly competitive SUV segment
- Hybridisation challenges and electrification shift, including differentiation opportunities 4. Unit economics, discussing trends in operating margins and CAPEX requirements to support growth 5. Divestment opportunities for the Volkswagen Group (ETR: VOW3)
Questions
1.
What is your 4-5-year volume growth outlook for Lamborghini? We’ve heard comments from the OEM [original equipment manufacturer] around the positive outlook on this since restrictions have eased, and obviously there was a drop in 2020 due to coronavirus.
2.
How do you expect special project volumes to perform given the demand among high-net-worth individuals? The numbers are small vs total volumes, but the profit contribution is fairly healthy.
3.
To confirm, GBP 500,000-600,000 is the price point for special projects, and then 250-350 units per year at that price point?
4.
How do you expect volumes to split by model as they grow to 10,000-11,000 units per year over the next two years? You mentioned strong volume growth, and a big part of volume has been driven by the Urus, the SUV within Lamborghini’s portfolio.
5.
What could be Lamborghini’s fourth product line? We’ve got the SUV already.
6.
Why do you think the Urus has had phenomenal success?
7.
There’s increased competition in the SUV segment, in particular the Aston Martin DBX, and the Ferrari Purosangue is on its way. How easy and likely is it for Lamborghini to sustain the current volumes in this intensely competitive segment?
8.
What could Lamborghini’s volume split be by region with 10,000-11,000-plus units per year?
9.
To confirm, the market share you’re talking about is revenue share for Lamborghini, which is 35% in EMEA, 30-35% in North America and 30-35% in APAC?
10.
Why has Lamborghini been underperforming in APAC?
11.
Has Lamborgini been underperforming in APAC due to the product engine type or is it also due to the look and feel of the product?
12.
What do you think is driving the successful volume growth at Lamborghini?
13.
What derivative cadence do you think is required for Lamborghini to support growth in existing models, given you mentioned the Aventador and Huracán?
14.
What’s the typical cycle in years for models such as the Aventador and Huracán?
15.
Is there much of a challenge around mixed messaging or cannibalisation for Lamborghini in launching the Aventador and Huracán derivatives at the same time?
16.
You expect pricing for the Aventador to be around GBP 300,000 and the Huracán to be below GBP 200,000. When could this pricing be introduced? What are the price drivers across models?
17.
How price elastic is Lamborghini’s customer base? It seems large increases are being passed through.
18.
How much price elasticity do you expect among hybridisation efforts given this could impact pricing? Could customers be less price elastic amid the hybrid roll-out?
19.
How big is Lamborghini’s revenue growth opportunity from adding on options to improve price?
20.
What do you think sets Lamborghini apart from players such as Ferrari?
21.
What are Lamborghini’s challenges in shifting towards hybridisation? Its strengths are traditionally in the powerful engine.
22.
Is it realistic to assume that Lamborghini could operate on a shared platform with other brands in the Volkswagen Group, given you mentioned the benefits of this group? They sit at a fairly different price point to Lamborghini.
23.
How could premium OEMs such as Lamborghini differentiate in the plug-in hybrid and eventually pure electric markets?
24.
Is the dealership the main experience driver?
25.
Is there a chance for Lamborghini to take share from Ferrari in the shift towards cleaner energy?
26.
I think Lamborghini has pledged EUR 1.5bn to support the shifts over the next four years in its clean energy strategy. How sufficient is this?
27.
What would be a more realistic spend on a yearly basis given you think EUR 1.5bn seems slightly light?
28.
What’s your profitability outlook for Lamborghini? You mentioned the profit hit from plug-in hybrids, and we’re hearing around a 20% return on its sales target.
29.
Audi and Volkswagen Group have been quite clear that Lamborghini is not for sale. What are the driving forces here? Why hold onto the asset vs spinning it out?
30.
What do you think are the carve-out challenges for Volkswagen Group?
31.
Would the carve-out scenario be a direct sale or an IPO? What do you think of the options?
32.
How can we be confident in Lamborghini’s ability to operate as a standalone company through any IPO, given the challenges from players such as Aston Martin Lagonda post-IPO?
