During the global chip shortage, many in the automotive industry and beyond were scrambling to get decent orders of chips. However, in the same period Ferrari’s supply chain managed to absorb the shock.
The company increased shipments, posted record profits, and avoided major production disruptions. All of this was happening at the same time that mass-market carmakers slashed output and delivered cars missing features.
In this article, we explore how Ferrari’s supply chain pulled that off, what made it possible, what others can learn, and how African supply chains can put those lessons to work.
Key Nuggets:
- Ferrari’s supply chain stayed strong through the global chip shortage by building predictability into its order book.
- Small production volumes and high per-unit margins gave it bargaining power that other automakers lacked.
- Ferrari avoided production cuts, delays, and unfinished inventory by keeping plans stable and relationships tight.
- African supply chains can apply these lessons by focusing on demand visibility, strong partnerships, and value-rich outputs.
How Ferrari’s Supply Chain Stayed Stable While The Industry Scrambled
In 2020, automakers canceled chip orders as COVID hit. The chipmakers, now underused, were forced to adjust and make room for more consumer electronics as demand surged.
But car sales returned faster than expected in 2020.
Unfortunately, there weren’t enough semiconductors to go around. As a result, about 10.5 million vehicles were wiped from production plans in 2021. Plants could not operate, and those that could manufacture cars removed some non-essential features.
For example, in September 2021, General Motors halted production at 8 North American plants, including those making its lucrative trucks/SUVs. In some cases, the finished cars sat waiting in lots — missing tiny but essential microcontrollers.
Meanwhile, in the middle of this chaos, Ferrari stood out.
During the peak of the shortage in Q3 2021, while many were scaling back, Ferrari posted a 19% increase in revenue over the previous year. The company was not spared from the shortage, but it wasn’t crushed by it.
Read More: Lessons From IKEA’s Shipping Strategy During The Houthi Crisis.
Ferrari’s Rare Supply Chain Visibility
Ferrari’s entire production strategy is build-to-order, so customers typically have to pay deposits for the vehicle they want and wait. Sometimes the waitlists can stretch into multiple years, which means every vehicle on the production plan already has a confirmed buyer.
As of early 2022, Ferrari’s CEO said their order book was “up double digits” and “covered well into 2023.” That long-range visibility gave the company an edge in meeting customer demands that others didn’t have.
The supply chain could plan parts, production, and procurement months in advance, which is crucial when chip lead times stretch past 6–12 months.
While other OEMs flipped between over-ordering and canceling, Ferrari gave stable forecasts backed by committed demand. Suppliers rewarded that consistency with reliable allocation.
Read More: Lessons From Domino’s Autonomous Delivery Program.
Ferrari Needed Fewer Chips And Had More Cash to Get Them
Ferrari ships fewer than 15,000 cars per year. That’s not even a rounding error for companies like Toyota or Volkswagen, but in this case, it was an advantage. Because of the low volume, Ferrari didn’t need to fight for millions of chips.
At the same time, each car brought exceptionally high margins. In 2021, Ferrari’s EBITDA margin hit 35.9%. That gave the company room to:
- Pay extra for components without cutting profit.
- Expedite parts without damaging the bottom line.
- Offer suppliers high value per unit to ensure priority treatment.
The strategy had a massive impact because any supplier facing constraints will favor a small customer with high-per-unit value over a large one with thin margins and erratic orders.
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Stable Demand and Supply Planning Reduced Risk, Waste, and Chaos
Demand volatility made it difficult for automotive manufacturers to plan consistently. For example, during the pandemic, mass-market manufacturers had to repeatedly start and stop their manufacturing plants, which sent conflicting messages to chip suppliers.
Ferrari avoided that mess. Its waitlisted customers were used to delayed gratification, so during this period, they weren’t pushing for rush deliveries.
This allowed Ferrari’s supply chain to deliver full-spec cars with no stripped features, stick to its original launch and build schedules, and sequence production around chip availability without cancelling trims.
Every car was shipped with the complete features, and Ferrari had zero inventory loss from unfinished stock.
Read More: Lessons From Coca-Cola Sabco’s Supply Chain Innovations in East Africa.
Lessons From Ferrari’s Supply Chain During The Pandemic
Ferrari survived and grew during the semiconductor shortage by using levers that most companies overlook until it’s too late. Here is a simple playbook for you:
1. In Disruption, Value Density Trumps Volume
When demand outstrips supply, low-volume, high-margin production wins. Think of it this way: If you have one truckload of chips to allocate, who do you prioritize — the buyer whose product brings $50 per unit or the one that brings $5,000?
2. Demand Certainty Beats Forecasting
Ferrari’s advantage wasn’t better forecasting but having committed orders years ahead. These were locked in, paid for, and unlikely to be canceled. That level of certainty meant suppliers could count on those numbers rather than revising them every few weeks.
Forecasting is great when times are smooth. But when there is a disruption, it’s the companies with real demand signals that win allocations.
3. Relationships Don’t Start in a Crisis
Ferrari’s supply chain resilience wasn’t built during the chip shortage. Prior to that, the company already had a reputation for a predictable build schedule, long development cycles, and low SKU churn, which was revealed during it.
That meant it was easier for suppliers to prioritize the supply chain when tough calls had to be made. Meanwhile, mass-market brands that had cut orders in 2020 found themselves at the back of the line in 2021.
Stability isn’t sexy — until supply dries up.
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How African Supply Chains Can Apply These Same Principles
Ferrari’s playbook was about structure. And the same principles can apply to various supply chains across Africa, whether in food, electronics, manufacturing, or retail, and beyond.
1. Be a Reliable Customer
Some businesses are what you will call loud voices, but in reality, they aren’t very stable. That can be expensive during shortages, as suppliers face hard choices and want to prioritize customers with consistent orders, clear communication, on-time payment, and adherence to timelines.
Being reliable builds goodwill. And that goodwill becomes access when the market tightens.
2. Build Flexible Production Processes
Flexibility is less about technology and more about process thinking.
Ferrari adjusted which models to build when chips were tight without disrupting flow. You can do the same by in times of crisis by sharing components across products, cross-training staff, and sequencing production based on what’s available.
3. Don’t Outsource Supply Chain Thinking
Ferrari hired a semiconductor veteran as CEO. African firms might not do the same, but they can still include supply leads in strategic planning, train leadership on procurement risks, and build internal awareness of material constraints.
Every shortage is a mirror that shows whether your leadership sees procurement as a priority or a problem.
Obinabo Tochukwu Tabansi is a supply chain digital writer (Content writer & Ghostwriter) helping professionals and business owners across Africa learn from real-world supply chain wins and setbacks and apply proven strategies to their own operations. He also crafts social content for logistics and supply chain companies, turning their solutions and insights into engaging posts that drive visibility and trust.
