Ferrari’s Long-Time Chairman di Montezemolo Resigns

Luca Cordero di Montezemolo (Credit: © Ferrari)

The man noted for turning a failing Ferrari brand into a thriving empire following the death of Enzo Ferrari, Luca Cordero di Montezemolo, is stepping down following 23 years of running the company. When di Montezemolo took over Ferrari, success was nearly immediate, as he led the company to multiple Formula One Constructors’ Championships and dragged the company out from under massive debts. Had it not been for Luca’s presence in the company, who knows what kind of brand it would be today, if the Ferrari brand was still around.

Well, now after 23 years at the helm of one of the most exclusive brands in the world, di Montezemolo is leaving the company. The unfortunate thing is that he is not simply riding off into the sunset on his own terms. In fact, he is essentially flying out the door riding the pointy tip of Sergio Marchionne’s loafers mostly due to disagreements on the future of the brand.

di Montezemolo is famously an against-the-grain kind of chairman. For example, he is most recently famous for saying that Ferrari sells too many cars, and is losing its exclusivity, so he announced that the brand would scale back sales and increase prices. And the best part is that no one batted an eyelash about it simply because it’s Ferrari…

Despite Ferrari maintaining great profit margins, this reduction of sales is one of the key factors that led to the semi-voluntary retirement of di Montezemolo. Sergio Marchionne, who is the CEO of Ferrari’s parent company Fiat S.p.A., wants the brand to expand its sales by offering less-exclusive models and possibly getting into cars that sell in better volume. Additionally, Marchionne wants Ferrari to share its technology with other automakers under the Fiat S.p.A. umbrella to help it better compete with automotive Goliath, the Volkswagen Auto Group.

However, this was met with stiff resistance from di Montezemolo, and this resistance combined with repeated Formula One failure in recent years resulted in his stepping down before getting the heave-ho. In a comment regarding his leaving the company, di Montezemolo said “Ferrari is now American, which represents the end of an era.”

His resignation officially takes place on October 13, 2014. However, don’t feel too bad for the former chairman, as he will receive a severance package that includes €13.25 million ($17.13 million) on January 31, 2015 by agreeing not to work for a competitor from now until March 2017, and €13.7 million ($17.71 million) in salary payable over a 20-year span.