Capitalizing on the Greenlash? On the (re-)launch of 12-cylinders luxury cars (here Ferrari’s Dodici Cilindri)

by Peter Seele; LOL — Luxury Observatory Lugano, Switzerland

May, 26th 2024

Greenlash: the latest trend in sustainability

It is complicated: studies are still not clear if and from what milage onwards electric vehicles are more environmentally friendly than cars with combustion engines. What about the rare materials to produce batteries? What about their disposal? The early days of the green economy and sustainable development are over. The peak of going green was reached when becoming (political) mainstream. As a consequence, corporations are not the only greenwashers anymore. Also, politicians have discovered the temptation of framing green messages to attract votes and thus have become greenwashers. Just think of the EU taxonomy labeling gas, a fossil fuel and nuclear, producing waste for millennia) officially as green. The Guardian calls this the “biggest greenwashing ever”. Or just think of the COP conference 2024 hosted by the monarch of an petrostate and CEO of an oil company. Greta, the former teenage activist is not credible as moral authority anymore. Her most important and relevant claim “follow the science” has lost much of its impact, though the scientific evidence pro sustainability is — unfortunately — still overwhelming. In today’s hyper-polarized times the sentence “follow the science” sounds like a long gone echo. Now what is the green state-of-the-art. What is the Zeitgeist’ response to the crisis of sustainable development?

All this complicated green mess is summarized in the latest trend in the green universe: The “Greenlash”, a grammatical composite of “green” and “backlash”. Greenlash.

Ferrari as trendsetter for capitalizing the greenlash?

Now how does the greenlash impact on luxury goods? As sustainable luxury, positive luxury and ethical luxury have been top-selling concepts for the last years — and still are — what does the Greenlash do to the luxury industry? I argue, infused with a dash of cynicism, that it creates an attractive business opportunity for the luxury industry. Among the many examples possible (like private jets, superyachts, architecture, etc.) I focus on luxury cars, more specifically the recent launch of the new Ferrari “dodici cilindri” (Italian for 12 cylinders). The model’s name tells everyone right in the face (and I shall assume that you can also hear a heroic sound of majesty right in your ears), that it represents three regular 4 cylinder cars in one chassis. Ok, it also tells us, that Ferrari is still modest as it does not represent four regular 4 cylinder cars like the 16 cylinder Bugatti, build by Volkswagen. But it is also two six cylinder Porsche 911, which grosso modo also represents the price tag of the new Ferrari with a proposed starting price of 395 000 Euros (another text on the tragedy of the 911 as victim of its own success is coming soon, but seriously, we do not have to feel sorry for Porsche). The Dodici Cilindri also works with the non-charged “naturally aspirated engine” like the 911 — did in the past (if I may:“naturally” is an absurd word for a machine).

Now: why is the launch of a new 12-cylinder car — by the name “12 cylinder” — such an issue seen through the greenlash perspective? For three reasons:

1. Downsizing: The general trend of downsizing cars for the last years due to the commitment to reduce emissions and stop, ahhh, sorry, mitigate climate change.

2. International regulation: Changing from fossil fueled to electronic vehicles from around 2035 onwards.

3. Lobbying: Fleet emission regulation and — pars pro toto — Ferrari as smartest luxury brand in the room (quote LoL).

Ad 1: Downsizing: The general trend of downsizing cars gained momentum during the last years due to the commitment to reduce emissions and stop climate change. Mercedes for examples banned all 8 cylinders from the main brand, that is Mercedes-Benz. So, the famous S-Class 500, an institution for decades with 8 cylinders and 5000 ccm has been abandoned from the Mercedes-Benz brand universe. It has however to be said, that the 8 cylinder is still available as supercharged version in the inhouse-tuning brand AMG, a legally separate Mercedes company. But even on the AMG level, the 12 cylinder has been banned, and only supercharged 8 cylinders will be available. The AMG S class with 12 cylinders is not produced anymore. The Mercedes-AMG S 65 Final Edition from 2019 was the last model. But sorry, Mercedes. We got your holistic thinking. Mercedes-Maybach, a third independent company belonging to Mercedes still has the 12 cylinders. So good news for the environmentally friendly middle class Mercedes drivers. Their brand cares about downsizing. Needless to say, that the same is true for Stellantis, to which Fiat belongs, to which Ferrari used to belong. Still fan of upsizing? Currently the following brands feature 12 cylinders: Ferrari, Rolls Royce, Maybach, Aston Martin, Lamborghini and the Bugatti 16 cylinders from VW, whereas Bentley (also VW) stopped in April 2024, shortly before the Ferrari Dodici cilindri launch.

Ad 2: International regulation. Several jurisdictions have issued plans to ban all fossil fueled combustion engines from around 2030 or 2035 onwards. The EU commission declared that the “Fit for 55” deal will end the sale of new CO2 emitting cars in Europe by 2035. Several US states as well. The UK from 2040 onwards. China plans 50 % elective vehicles by 2035 and Norway bans new combustin enginge cars from as early as 2025. So all in all, plenty of time so sell the 12 cilindri in the next 11 years. Only in Norway this will get difficult, but as one can read these days many Norwegian billionaires left Norway and are now living in sunny Lugano. As of now Switzerland is still thinking about adopting the EU regulations of going emission-free in 2035. Maybe, maybe not. Good for Ferrari! That means a life cycle of at least 10 years. And Germany’s strongest political party (CDU/CSU) just now in May 2024 argues for abandoning the ban of combustion engines — and I have not yet mentioned the oil-states in the deserts, who are not so much known for downsizing anything.

Ad 3: Lobbying: Ferrari’s strategy to launch and thus to celebrate the 12 cilindri in 2024 is therefore an extremely smart move. Bold, but smart. A slap in the face of the non-Ferrari drivers, but isn’t that what 12 cylinders is all about in the first place. Conspicuous consumption as Thorstein Veblen has described it more than a hundred years ago? But “Ferrari as the smartest luxury brand in the room” (did you realize the play of word borrowing from Enron?) does not stop with intelligent timing of channel-specific product development. The EU allowed for an exception of the upcoming emission regulation for Ferrari (and some other car makers selling small numbers of units — sorry Porsche, no sorry, you just sell too much). Selling less than 1000 units per annum in Europe means that no restrictions of emissions whatsoever will apply. As “auto-motor-sport” one of Germany’s most relevant car magazines explains, this exception is a concession for Italy, as the Italian minister for environmental affairs Roberto Congolani (who by chance happens to have worked before with Ferrari,) argued, that “European Small Volume Car Manufacturers” (ESCA) produce luxury goods with a longer lifespan. Did they use the word sustainable? Well, I do not know, but given the almost Babylonian confusion of language when it comes to the term sustainability, I would not even be surprised.

So, all in all an extremely smart move from Ferrari not only getting an exception from the legislation for the other car makers, but taking a restriction and turning it into a business opportunity. Creating a new 12 cylinder and play the marketing concept in a blunt way upfront calling the product a 12 cylinder. This goes much further than Maserati calling its rare four-door-car a Quattroporte (Italian for four doors). That was elegant, also because of the elegance of the Italian language for non-italophone-ears. Ferrari goes all-in symbolically saying: “This is Ferrari”. A bit like “This is Sparta” like in the Jack Znyder film “300”. “This is Ferrary. This is the Dodici Cilindri.” It is a bold message of a bold identity.

Learnings

So, what may we learn from this little LoL-reflection?

a. Downsizing is for the luxury middleclass. The top segment still has a fantastic variety of 12-cylinder models, and the Ferrari 12-cylinder opens the new chapter of being clear about it: Maybach, Ferrari, Bugatti. The top level segment does not downsize. The middle-top level luxury segment has to find itself in the political mainstream of regulation. Just think of the S-class 500. Once the highest standard, now the top end of the lowest brand range (under AMG, under Maybach) of cars with the star from Mercedes. Louis Vuitton is for ordinary people watching the Olympics (maybe an essay on LV as Olympic sponsor when the games start in Paris later this year).

b. Why follow the money is more powerful than follow the science: Coming back to the greenlash. The success of the Dodici Cilindri from Ferrari, which, although not yet launched, is highly probable, confirms the greenlash — embodied in the chassis of a luxury grand tourer sports car. As the luxury segment often works as anticipating trends that later enter mainstream, I would expect that the greenlash is just getting started. Sad but true, seen from a scientific point of view. Just think of the decline of biodiversity. But business follows the money, not the sciences. And the sciences look into details. Business however says: Don’t look up. (Lol).

c. Hey Porsche. Sure, the 911 is an icon with 6 cylinders we all love and here in Lugano you can see the 911 marking its territory all over the place. But how will you explain to your shareholders n o t to capitalize on the top luxury segment with a real top-end luxury car with an insane big engine like the Ferrari dodici cilindri? And didn’t Ferrari — ähhh — borrow the black stallion in the logo from Porsche in the first place? But Ferrari somehow gets away with it. Always. Turbo Furbo.

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