Hong Seh Motors, the local distributor for Ferrari sports cars, could face the loss of its 25-year franchise rights to the brand. Sources say that Ferrari is close to signing a new deal with tycoon Ong Beng Seng, who brought F1 to Singapore last year.
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Ferrari may be in race for new dealer
By Christopher Tan
27 February 2009
Italian sports car maker Ferrari is close to appointing a new dealer in Singapore - a move that could hurt incumbent Hong Seh Motors, a private enterprise that has held the franchise for 25 years.
The Straits Times understands that Ferrari - arguably the world’s most desirable car brand - has been in talks with several suitors and may make an announcement in coming weeks.
Market sources say the leading contender is Mr. Ong Beng Seng, the flamboyant hotelier who brought Formula One to Singapore last year.
‘Ferrari has strong association with F1,’ said an industry player. ‘And (Mr. Ong) is in all the right lifestyle businesses that Ferrari can be associated with.’
Mr. Ong - who runs hotels, builds high-end properties and holds the Hard Rock Cafe franchise for the region - was not reachable for comment, but talk is that his automotive business Komoco will be fronting the Ferrari franchise.
Komoco sells Chrysler, Jeep, Dodge, Hyundai and Harley-Davidson vehicles, but has long been looking to relinquish the first three brands due to poor sales.
Ferrari is officially denying the news. Asia-Pacific spokesman Matteo Bonciani said: ‘We have received many proposals from many parties...(but) Ferrari is still with Hong Seh at the moment.’
Hong Seh director Edward Tan said he was unaware that changes were afoot. The homegrown company, which started as a chemicals trading business 40 years ago, acquired the Ferrari franchise in 1983.
According to the Accounting & Corporate Regulation Authority, it posted an after-tax profit of $1.007 million in 2005 - the latest numbers available - up from $433,533 in 2004 and a loss of $608,966 in 2003.
The company recently acquired several new franchises, including Dutch supercar Spyker, German boutique brand Artega and Italian bike brands MV Agusta and Cagiva. It also has a few boat makers in tow, including the luxury brand Riva.
Ferrari, part of Italy’s Fiat Group, has increasingly been asking its dealers to invest more in the brand. This has apparently led to some parting of ways.
London-based Inchcape - one of the world’s biggest vehicle retailers - gave up Ferrari and its sister brand Maserati in 2007. In the same year, Ferrari became its own importer and distributor in Japan, its largest Asian market.
Should the Ferrari franchise here change hands, Maserati may follow.
Mr. Bonciani said Ferrari and Maserati - both based in Northern Italy - are sold alongside each other in many markets.
Last year, Hong Seh sold 45 Ferraris and 87 Maseratis - down from 52 and 94 respectively in 2007. Ferrari was also beaten by archrival Lamborghini, which registered 49 sales last year. Lamborghini first overtook Ferrari in 2006.
Worldwide, Ferrari sold about 7,000 cars last year - nearly three times the Lamborghini sales figures.
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