The Most Profitable Luxury Car Brand Isn't Porsche Or BMW

Ever since electric vehicles joined the consumer car market, the global automotive industry has shifted dramatically. Since EV research and development costs billions of dollars, older automakers have been forced to rethink product strategies. Nowhere is this more apparent than in the luxury car segment. While many luxury carmakers struggle with dwindling demand and profit margins, one automaker continues to outshine the rest: Ferrari.

According to Ferrari, 2024 was the brand's record year. With a margin of 28.3%, the company averaged a profit of $136,671 per car. For example, Porsche's 2024 profit margin has decreased to 14.1% from 18.0% in 2023, with an average profit of around $20,000 per vehicle. BMW's 2024 operating margin shrank to 6.3%, a decrease of 37% from the year before. With 2.45 million cars sold, the average profit per car for BMW in 2024 was $7,304. Here is why Ferrari stands out and how it manages to dominate the luxury car market.

The first reason why Ferrari is so profitable has to do with low production and high demand. Since Ferrari limits its production numbers to around 13,000 to 14,000 cars per year, it allows the company to sell every car at a premium. Special customizations through Ferrari's "Tailor Made" and "Atelier" programs allow customers to personalize their prancing horses even further. These programs can often add hundreds of thousands of dollars to a single car.

Ferrari is also one of those brands that rarely discounts any of their cars because it does not need to. According to a post on X by user @very_berry99, when asked about whether F1 drivers get discounts, Carlos Sainz, a Scuderia Ferrari F1 driver with an impressive car collection, said, "Actually no, Ferrari doesn't give discounts — not even to the drivers." The brand is known to care very much about who buys their cars in order to preserve exclusivity and profitability.

Because the logo itself is worth more than 15 billion dollars, Ferrari earns around 10% of its revenue through licensing, sponsorship, and merchandise. Many of its supercars also depreciate less compared to McLarens or other competitors, and this gives customers reassurance that they will not lose nearly as much money when it comes time to sell them. In some cases, with special Ferrari models, they might even earn money due to being great investment opportunities.

The sheer strength of this Italian brand is also evident in its special buying programs, where owning one model is often required to access ultra-rare editions. For example, to be eligible to buy a LaFerrari, you'd have to be personally hand-picked by Ferrari and invited to buy it. A Ferrari spokesman Jason Harris told The Independent that special Ferraris "are only offered to our most loyal and passionate clients that have a long-standing relationship with the brand."

There were instances where Ferrari car collectors with collections worth over $50 million were not considered "important" enough to be invited to buy the LaFerrari. From a value standpoint, the 2015 Ferrari LaFerrari was priced at $1.4 million when new, but used prices are now easily more than double that. 

One of the most interesting Ferraris in years, the exceptionally rare Daytona SP3, has recently been sold for an eye-watering $26 million at auction. All of this underlines why Ferrari is so successful and why some collectors are willing to go the extra mile and buy dozens of Ferraris just to stay in Ferrari's good graces.