Enzo Ferrari was strong believer of competition, for this the company not concentrated on one series, but participated in different ones, including Formula 1 and endurance races, as Le Mans.

From 1963 to ’65 the Ferraris had been unbeatable at Le Mans, but after this period came the time for Ford. The company used the experience of the AC Cobra and developed the GT40, which won the famous race from ’66 to ’69. Enzo had to accept that his company was too small to finance alone the development of its future race cars. After he declined earlier Henry Ford’s offer to overtake the company, finally in ’69 he agreed to sell half of the company to Fiat, what allowed him to stay in charge of the racing team and further to develop the new endurance car 512 S, including its mandatory production of 25 cars, so that he was able to start at Le Mans.

With Porsche entered a third powerful competitor. Already in ’68 and ’69 they reached the the second position, for this they had been the favorite for the 1970 Le Mans event, also as Ford stepped out the race. But this was no automatic development, as Porsche  wanted more than the reached second positions; they developed already in ’69 the iconic 917, including the needed small production of 25 cars. The company used their experience from the last two years and developed based on this the new car with the direct task to win the famous 24 hours-race. The preparation paid out, and as expected the experienced Porsche team had no problem to beat the complete new Ferrari. The race itself was also used to film scenes for Steve McQueen’s movie about Le Mans, still today seen as the best Hollywood racing movie.

512S

Due to changes of FIA rules in the next year, Ferrari decided to start only with the semi-official N.A.R.T team in Le Mans. The US team did a good job and finished on third position behind two 917s, both strongly supported by the Porsche Company. In the meantime Ferrari started the development of the 312PB. The first appearance of the car at the 1000kms of Buenos Aires had a tragic end, as its driver Ignazio Giunti died in a race accident. But the next year, the 312PB dominated the FIA World Sportscar Championship, wining all races except Le Mans, as the Scuderia skipped it due to missing 24 hours testing.

The next year, Ferrari came back to Le Mans with a special 312PB long-tail version. But the race luck was not with the Scuderia and so the ’73 24 hours race was won by Matra Simca 670B.

Competition not only leads to technical progress, but also centralization, as in a mature market, further progress is difficult to reach, and requires, in opposite to young markets, high investments. Costs, which single companies alone often, cannot finance anymore. Joint-ventures and acquisitions are the results. Ferrari is since 1969 part of Fiat, in the same year Porsche collaborated a first time with Volkswagen to develop the 914 street car. Since 2013 it became a part of the VW Corporation. So theoretically competition leads at the end to an oligopoly or monopoly. Anti-monopoly laws have to limit this trend and ensure a fair race. On the other hand, new competitors can enter the market. Such companies may come from a completely different background, such as iPhone, Uber or Tesla, and due to this, may accelerate thanks to their fresh ideas. For this it is the governmental task not only to limit market-concentration, but also to keep the market entry-borders as low as possible.

 

Book:

Henz, Patrick (2015): Business Philosophy according to Enzo Ferrari – from motorsports to business

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