When venerable Volkswagen patriarch Ferdinand Piëch issued invitations to his 75th birthday party at Taschenberg Palace in Dresden three years ago, Ducati brand had just been added to the company.
The Italian firm, long Mr. Piëch's favorite two-wheeler brand and sometimes called the Ferrari of motorcycles, was purchased by Volkswagen’s automotive subsidiary Audi for an estimated €860 million, or $962 million.
Since then, Audi and Ducati have been emphasizing their high esteem for each other. But last year, sales figures for Bologna-based Ducati remained flat at about 45,000 units. And the operative margin that Audi released for Ducati, namely four percent, was significantly under the carmaker’s own margins. Even worse, motorcycle competitors BMW of Germany and Harley-Davidson of the United States recently achieved margins of more than 20 percent.
Ducati’s performance is supposed to change dramatically this year. “We expect to sell more than 50,000 units,” Ducati chief executive Claudio Domenicali told Handelsblatt. That would be a plus of more than 10 percent and a record for the brand from Bologna, which will celebrate its 90th anniversary this coming year.
How well Ducati motorcycles are selling is evident in the just-released figures for the first half year: 32,600 were sold, a rise of 22 percent in relation to last year. In Germany, which the country’s Motorcycle Industrial Association president Heiner Faust likes to call the “Big Bike Republic” because of its preference for large, heavy, powerful motorcycles, the increase was 24 percent. Market leader BMW sold five times as many motorcycles as Ducati, which was eighth in the rankings.
“The margin that we are aiming at in the next five years lies between eight and 10 percent,” said Mr. Domenicali, 49, who has been at the company since 1991 and now, with Audi, is witnessing its fourth owner. He said one should take Ducati's margin with a grain of salt. Because of additional, scheduled depreciation allowances because of the revaluation of assets and debts in the framework of purchase-price allocation, Audi calculated a margin of 4 percent. Without these special factors, the margin ― according to Ducati's reading ― was 8.2 percent.
For Ducati, the Scrambler models are smaller, simpler and at less than €9,000 more inexpensive motorcycles appealing to a significantly younger clientele
The reason why Ducati has made such a leap in sales this year is due above all to the new model line Scrambler. For Ducati, the Scrambler models are smaller, simpler and ― at less than €9,000 ― more inexpensive motorcycles appealing to a significantly younger clientele. In the first six months, 9,000 units from a total of four Scrambler variations were sold. That kind of figure had never been reached before by individual Ducati models.
For that reason, Mr. Domenicali intends to introduce further versions onto the market in coming years. He said the margin will not be watered down through this comparatively inexpensive model ― a Ducati normally costs about €20,000 on the average: “The fact is that the Scrambler is not that expensive to produce.”
Also, Mr. Domenicali plans to present one high-end version of a Ducati model line each year. Last year, 500 such versions of the 1199 Superleggera sportsbike were sold at a price of €65,000 each.
Mr. Domenicali retained his composure regarding recent rumors about a management shake-up. “No idea,” he said in perfect German. He said he didn’t anticipate any changes in the foreseeable future.
Ducati is not Audi's first Italian experience, but some collaborations have been more successful than others. The Germans also own the sports car manufacturer Lamborghini and the premier engineering company Italdesign, which designed the first VW Golf in 1974.
With Lamborghini, Audi showed that life within the VW company can bring opportunities to an Italian brand. The circumstances surrounding the takeover of the high-end car manufacturer in 1998 were similar: Lamborghini as well had experienced several ownership changes ― from Swiss, then French proprietors, past Chrysler all the way to Indonesians.
Audi invested massively in the Italian brand. When the Germans arrived, the brand sold only 250 to 500 cars a year and was incurring losses. Today the figure is more than 2,500 and the company sends profits back to Germany. Starting in 2018, Lamborghini intends to bring the SUV model Urus onto the market and sell 3,000 of the model each year. That would represent the same transformation as at Germany’s Porsche where, despite its racing-car history, the company has come to sell more sport utility vehicles than its other offerings.
At Italdesign, founder and designer legend Giorgetto Giugiaro, 76, departed for good this month. Five years after its initial involvement, Audi last week took over the remaining 9.9 percent from Mr. Giugiaro and his son Fabrizio, 50.
Shortly after the turn of the millennium, Wolfsburg-based Volkswagen wooed Walter de Silva away from Italian automaker Alfa Romeo. He provided Volkswagen’s Spanish automaker SEAT division with a new design, then Audi. Since 2007, he has been in charge of visual appearance for the VW group’s brands. The eye-catching appeal of the cars has been a crucial factor in the doubling of sales since then.
But the Volkswagen group will have to bid farewell to one other Italian dream. Alfa Romeo, also a favorite brand of Mr. Piëch, will not make its way into the company's holdings. Mr. Piëch, the Porsche family scion and chairman of Volkswagen’s supervisory board, lost a public battle with the automaker’s popular chief executive, Martin Winterkorn, and resigned suddenly in April.
Video: Ducati's Diavel Carbon Edition.