German automotive giant Volkswagen Group’s niche Ducati motorcycling indulgence continued to be a small but gloriously profitable jewel in the crown of its premium brands portfolio during the first half of 2023. BDN financial editor Roger Willis reports.
Six-monthly revenue from VW’s Bologna-based Ducati outpost climbed by 22.3% to £569m. Operating profit was a muscular 70.9% up to £99.5m. Operating margin rose from 12.6% to 17.6%. And these remarkable figures were achieved with a relatively modest 4.8% growth in retail sales volume to a record 34,976 units, highlighting the brand’s ability to charge eye-wateringly high prices for its wares.
Setting such an impressive performance in contextual scale, Volkswagen as a whole registered an 18% revenue increase to £134.2bn during the same period. However, adjusted group operating profit declined by 14.4% to £9.7bn. (There was a better “underlying” profit assessment available, but somebody may have been telling Teutonic porkies.)
The company’s premium brand sector (Audi, Bentley, Lamborghini and Ducati) together turned over £29.3bn, by far the biggest slice (about £26bn) from Audi. Their combined operating profit contribution came in at approximately £2.9bn. Audi’s profit share fell from 83% to 72%. Lamborghini increased from 9% to 13% and Bentley claimed 11%, up from 8%. Ducati took 3%, rising from just 1%. Smaller but beautifully formed?
Returning to metal bashed and flogged rather than purely banked loot in Wolfsburg or Ingolstadt, total Ducati production in 2023 to date grew by a marginal 1.1% to 36,224 units. Weakest segment by far was the Scrambler sub-brand. Output fell by 12.5% to 5274 and deliveries to customers slumped by 13.8% to 4311. Nevertheless, Ducati vice president for global sales Francesco Milicia flagged 3581 samples of the Scrambler 800 “family” as third best-seller.
Naked/sport cruiser segment production spanning Monster, Diavel and Streetfighter machines also declined slightly, by a narrow 3% to 11,668, and retail uptake only put on 2.2% to 11,397. But some 4299 Monsters grabbed runner-up retail spot worldwide. The dual/hyper segment was effectively leader of the pack. Production of Hypermotard, Desert X and most pertinently Multistrada models only grew by 0.3% to 11,619. But consumer demand went ballistic, leaping by 18.1% to 12,680 bikes rolling out of showrooms. Of these, 6382 were outright best-selling Multistrada V4 steeds in all their various configurations.
The sport segment covering supersport and superbike machinery waving a Panigale banner, upon which Ducati loves to be revered, was relatively tame. First-half production stacked on 23.8% to 7663. But retail managed only 1.7% growth to 6588. So there’s a fair chunk of inventory gathering dust somewhere.
Europe strengthened as Ducati’s largest market globally, accounting for 62% of all sales — up from 57% in the first half of last year. Italy’s domestic consumption topped the pile, adding 10% to reach 6639 units. Germany made a 13% gain, selling 4217. The USA reinforced second-tier status, its global share rising to 13% from 12%. US retail headcount grew by 11% to 4504 bikes. Deliveries to aspirant Chinese Ducatisti, including those in Hong Kong, sank to 4% from 7%. Other unspecified markets dropped to a 21% share from 24%.
€-£ currency translation at forex rates applicable on 31 July