Ferrari has a problem that makes other auto companies sick with envy - out of control demand. "In China, they enter the showroom with bags of money and say they want to take the car," says Amedeo Felisa, 60, the genial and rumpled general manager of the Italian sports and racing car maker.

The wannabe Ferrari owners are told to wait. Two months, six months? Dream on. Try two years or longer for new Ferrari models, such as the F430 Scuderia. Older models - "old" in Ferrari-speak means a car introduced two years ago - have waiting lists as long as 15 months.

Ideally the waiting lists should be 12 to 15 months, Mr. Felisa says. The figure is a careful concoction of economics, psychology and marketing voodoo - Ferrari's sales managers call it "managing the wait list." A wait list of less than a year might tarnish Ferrari's cherished reputation for exclusivity and erode the (rising) profit margin. "I've always felt Ferrari has to remain exclusive," says Remo Ferri, 58, the owner of Maranello Sports and its two Toronto Ferrari dealerships. "It's a car that needs to be desired and pursued, like a beautiful woman."

If the wait is longer than two years, prospective buyers might exit the showroom to buy a customized Porsche, whose waiting lists are three to six months long, an Aston Martin, a Lamborghini (owned by Volkswagen) or a different luxury toy, such as a yacht or a holiday property.

Long waiting lists can lead to other difficulties for Ferrari, its dealers and (by definition) their wealthy and often impatient customers. In effect, it means Ferrari and the dealers risk losing control of pricing and alienating the loyal client base, about half of whom own more than one Ferrari.

Long waiting lists mean second-hand values are often much higher than new values. This can tempt punters to buy a new Ferrari and flip it immediately for an instant profit of $100,000 or more.

When the 12-cylinder Ferrari 599 GTB Fiorano was introduced in 2006, North American buyers were willing to pay as much as $200,000 over the list price, says an American businessman who bought one.

With second-hand values so high, some dealers insist on the right of first refusal if the owner sells the car within a year. "Break the deal and you ain't getting another Ferrari, ever," says the businessman.

In an effort to reduce the waiting times, Ferrari is doing what it vowed it would never do - raise production rates fairly significantly.

In 1999, Ferrari president Luca di Montezemolo, who is also chairman of Fiat, Ferrari's 85-per-cent owner, said the company would never make more than 5,000 cars a year. At the time, the figure was around 4,000. Then Russia, Europe and China started minting millionaires and billionaires in the hundreds, each of them eager for high-end status symbols.

Mr. Felisa says the sales growth rate in the "new markets" is four times higher than in the traditional markets such as the U.S. and Germany.

Demand for Ferraris suddenly took off like never before. So did prices and wait times. Last year's deliveries were 5,671 and this year's figure will surpass 6,000, the company says. Earlier this year, Morgan Stanley analyst Adam Jones predicted Ferrari would produce 7,200 or more cars in 2009 and that one of them could be a new "Dino," the rumoured code word for the rumoured new small Ferrari, one that would carry the lowest price tag.

Ferrari aficionados worry higher volumes and a cheapie Ferrari, if built, would dilute Ferrari's powerful brand image. It is probably the only brand on the planet that rose to prominence without the benefit of advertising.

[In the Factory] The Globe and Mail's photographer is politely warned by Ferrari's PR lady not to take long-view pictures of dozens of cars under assembly. "We don't want to give the idea of massive production," she says.

Indeed, mass-produced cars cannot be "exclusive" cars. Ferrari wants to give the impression the speed machines are crafted by artisans in a space that is closer in spirit to atelier than factory. For Ferrari, it's all about protecting and building the brand. Ferrari insists the higher production rates and plans for new models will in no way compromise the company's image. "Everything is done to increase the value of the brand," Mr. Felisa says. "When you buy a Ferrari, you buy an image, a dream. You are entering into a special world."

While production rates are rising, Ferrari, he says, is not engaging in a market-share war. Its share will remain steady as the market for luxury sports cars, driven by the newly rich in Asia, expands. The Formula 1 team will never go away because it's a crucial brand-building element; Mr. Felisa calls the Grand Prix racing side, which probably loses a small amount of money after all the sponsorship money is tallied up, "an investment." Technology used in Formula 1 cars will continue to migrate to the road cars. Ferrari, unlike Porsche, will never build SUVs.

While Ferrari is nominally independent, the truth is Fiat, with its majority ownership, can ultimately decide whether the company builds high-end sports cars or tractors or anything in between. But Sergio Marchionne, Fiat's Italian-Canadian CEO, happens to be a Ferrari lover and seems unlikely to tamper with the brand as long as Ferrari's financial performance continues to improve. Ferrari's profit margin, or return on sales, was 12.6 per cent last year and is expected to reach 15 per cent this year. Morgan Stanley says it could go to a hefty 20 per cent by 2010 as sales increase and Formula 1 development costs come down".



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