Luxury vehicle sales soar as demand outstrips supply

A post-pandemic surge in ‘passion purchases’ is seeing Ferraris, Maybachs and even private jets sell out.

Ferrari 812 Competizione.

A post-pandemic surge in “passion purchases” — ultra-expensive cars like Ferraris, Maybachs, and even private jets — is being driven by the realisation that life is short, or what people in the industry call “YOLO spending”.

Ferrari Australia president Jan Hendrik Voss, president of Ferrari Australasia, says his company is racking up record-breaking order banks for its cars, most of which cost well north of $500,000, and it’s clear to him that the results are being driven by a change of mindset.

“With Covid, to me, it’s been three things; one is you have had no chance to spend your money travelling around the world, so people are choosing to spend their money on other things,” Mr Voss said.

“And then also, people see other people dying in the community of Covid, and people experiencing hardships, and they think, ‘life is short,’ so they don’t want to push their passion purchases out any more, they want to live those dreams now.

“People call it YOLO spending, as in You Only Live Once.

“Thirdly, I think what it comes down to, as a phenomenon of what we’ve lived through the past few years, is that people want to buy things that have meaning to them, and Ferrari provides meaning to them.

“There’s been a rethink of where people spend their money. Yes, I still want all the day-to-day things, but I want to add meaningful purchases to my portfolio as well.”

Mercedes-Maybach S 680 4MATIC

Another premium brand, Maybach - a Mercedes-Benz-owned luxury marque with prices reaching into the $500,000 bracket - has sold more vehicles in Australia since the start of 2021 than in the five years prior.

Mr Voss says that in the past year he’s seen a level of passion and inquiry about new Ferrari purchases that exceeded expectations, and that “the sky is the limit” in terms of orders.

The entire allocation of Ferrari Competiziones has already been sold out

Ferrari recently launched a new, V12-powered super car in Australia, the 812 Competizione, priced at $1,035,768, and its entire allocation has already been sold out.

In the rarefied world of private jet purchasing, the pandemic has caused a similar boost in sales, according to Mick Doohan - a former motorcycle racing world champion who now runs a company called Jetcraft, which sources new and pre-owned jets for the hugely wealthy.

“The effect of the pandemic has been the opposite of what you’d think, actually, because it’s been quite positive and demand for private aircraft is through the roof,” Mr Doohan said.

“The waiting time for some new jets is now out to 24 months, there’s just so much demand. And the price of some of our pre-owned jets has doubled in just the past 10 months.

Mick Doohan with Jade Russell aboard a Challenger 604. Pic: Peter Ristevski

“The jet manufactures lead times are pushed out, allowing them to increase their asking prices for the first time since the GFC.

“It’s a really interesting station for every asset class and it will be interesting to see how it plays out. Hopefully this demand situation will continue for a while.”

While supply chain issues have meant many people have to wait for new cars at present, waiting up to two years for your passion purchase is no problem for many people, according to Mr Voss. It has long been the case that Australians slapping down a deposit for a Ferrari might not take delivery for 18 to 24 months.

“Waiting is involved, and buyers don’t mind that, you can liken this to Christmas or your birthday; it’s so much more special because you’ve waited for it. They are comfortable with the deposit and the wait time because they know that something extraordinary is coming their way,” he explained.