If there’s one thing you’re gonna find
in every big city across the world, it’s cars. They’ve become so ingrained in modern society
that it’s hard to think how we could live without them, especially if your daily commute
involves more than a short bike ride. There are a lot of cars out there and they
come in a stunning variety, but you can generally divide them into two broad categories:
You’ve got regular cars, like the one my dad used to drive, and then you’ve got sportscars,
which, well let’s be honest, they’re on whole different level. The world of sportscars can seem a bit distant
to most people. Setting aside the stereotype of the fanatical
sportscar enthusiast who can recite model specifications like Bible quotes, usually
with sportscars, you’re either in love with them or you really don’t care. This week’s video is dedicated to the latter
group for two reasons. Firstly, you don’t have to be a sportscar
maniac to appreciate their fascinating history, and secondly, it would be pretty hard to impress
the enthusiasts who’ve been following this subject for three times longer than I’ve
been alive. Now, with that out of the way, we can move
on to the subject of this week’s Behind the Business video: Italy’s premiere sportscar
manufacturer, Ferrari During the early years of the 20th century automobiles were still in many ways an emerging
invention. Urban areas were doing pretty well in terms
of roads and infrastructure, but in the more rural parts of the world, a car was still
very much a rare sight. Northern Italy was no exception to this. In it’s earliest days the Italian automobile
industry was made up almost entirely of small local manufacturers. Most automotive hubs in the country were in
fact just the workshops of local engineers. One such workshop was ran by Alfredo Ferrari
in the outskirts of Modena, a city in the Emilia-Romagna region of northern Italy. Alfredo worked mainly as a metalworker, but
he also repaired cars in his workshop, since he owned one and knew how it worked. Alfredo would often get his young son Enzo
to help him out in the workshop, and in return he would teach Enzo how to drive. Enzo’s childhood ambition was to become
a race car driver, but before he was old enough to even try to pursue it Wolrd War 1 broke
out, and his father and bigger brother were drafted into the Italian army. Both of them died in 1916 during an influenza
epidemic, and the family business died along with them. Just one year later Enzo was also drafted
as a military blacksmith, but due to his poor health he was discharged in 1918 after barely
a year of service. Unemployed and desperate, Enzo took up a job
to drive ex-military refurbished chassis between Turin and Milan for an engineer that was rebodying
them for the civilian market. While working there Enzo met a lot of engineers
and former race car drivers. Eventually they gave him the opportunity to
pursue his dream of becoming a race car driver himself. Enzo’s first race was the Parma Poggio di
Berceto, a hillclimb race on October 5, 1919 where he managed to place fourth. In 1920 he went to drive for Alfa Romeo, and
in 1923 he managed to win the Circuito del Savio in Ravenna. The Savio track was one of the most competitive
tracks in Italy at the time, and Enzo’s victory was a huge surprise. One of the patrons of the race, Count Enrico
Baracca, was so impressed with Enzo’s performance that he invited him over to his mansion. There the Count’s wife recounted the tale
of their deceased son, Italy’s top scoring fighter ace from World War 1, Francesco Baracca. Francesco was credited with 34 aerial victories,
the highest among all Italian pilots from the war. His plane was decorated with the fearsome
cavallino rampante, a black horse prancing on a white background. The Countess was so impressed with Enzo’s
racing skills that she dedicated her son’s emblem to him. Enzo ended up winning about a dozen races
during his career, and in 1929 he formed his own team, Scuderia Ferrari, which served as
Alfa Romeo’s racing team for ten years. It is worth noting here that Ferrari actually
means ‘blacksmith’ etymologically and it’s one of the most common surnames in
Italy, essentially the italian equivalent of the surname Smith. But back to Enzo:
For the team’s emblem he chose the cavallino rampante, changing the white background to
yellow, the color of Modena. Enzo had a nose for talent, and he attracted
some of the best drivers of his day. Legends like Tazio Nuvolari and Giuseppe Campari
helped Enzo’s team win numerous races. Among some of their victories were the Targa
Florio, the Le Mans 24 Hours race, and over a dozen Grands Prix. In 1938 Alfa Romeo decided to disband Scuderia
Ferrari in order to build a team with their own name. At first Enzo remained as a manager of the
new team, but just one year later he left Alfa Romeo in order to form his own company,
Auto Avio Costruzioni. Enzo’s departure came with a sizable severance
package, but under the condition that he would not compete with Alfa Romeo’s new racing
team for a period of four years. During that time his company manufactured
machine tools and aircraft parts for Mussolini’s fascist government, although in 1940 Enzo
did try to design a race car of his own, the AAC 815. In just under four months Enzo designed and
built two of those cars. Only one of them still exists, and it’s
now a part of the Righini Collection, one of Italy’s finest private car collections
housed in a 15th century castle outside Modena. As World War 2 drew to a close the Allies
ended up bombing Enzo’s factory, but he had it back up and running by 1946. One year later Enzo unveiled the Ferrari 125
S, the first car to race under the Ferrari name. Unlike the 815, which used an 8-cylinder engine
designed by Fiat, Enzo had his engineers develop their own V-shaped engine with 6 cylinders
on either side. The V12, as it is called, has remained Ferrari’s
go-to engine for most of the models built since the Second World War. In 1948 Enzo released the Ferrari 166, the
successor of the 125 S, and it became the company’s first big international hit. Ferrari’s first big racing victory came
in 1952 when Alberto Ascari claimed the Formula One World Drivers’ Championship title driving
a Ferrari Tipo 500. Ascari would claim the title for Ferrari a
second time the very next year, becoming the first driver to win multiple titles in a row. It’s worth noting here that Formula One
is actually comprised of two Championships, one for the drivers and one for the constructors. Although the rules have changed considerably
since the 1950s, the modern iteration requires teams to field two cars at every Grand Prix. The teams can have up to four drivers per
season, and these drivers win points both for themselves and their team after every
race. Only the first ten drivers to finish a race
are awarded any points at all, and at the end of the season the driver with the most
points wins the Drivers’ Championship. The same method is used to determine which
team wins the Constructors’ Championship, but because teams can have multiple drivers
sometimes the two titles don’t go to the same team. Anyway, back to Ferrari. In 1957 they released the Ferrari 250 Testa
Rossa, which continued the company’s victory spree as it secured three World Sportscar
Championship titles in 1958, 1960 and 1961. The beginning of the 1960s, however, was actually
a very turbulent time for Ferrari. Several senior employees had opposed Enzo’s
decision to involve his wife Laura as a manager of the company. Laura was apparently very mouthy and had an
opinion on everything, which, well, it didn’t really win her any sympathy points, that’s
for sure. Eventually Ferrari’s Sales Manager Girolamo
Gardini confronted Enzo and presented him with a letter signed by 8 of his colleagues
demanding Laura’s resignation. Girolamo’s direct approach didn’t really
work though, since instead Enzo fired all nine employees who had signed the letter. This was a huge loss of talent for Ferrari,
and the event came to be known as the Great Walkout. The timing of the scandal couldn’t have
been worse, since Ferrari had suffered the death of four of its drivers over the past
two years. All of Ferrari’s developing models were
put on halt, and it took Enzo a year before he could finally resume production. Although the Great Walkout was the most disastrous
scandal in Ferrari’s history, it can be argued that it was in fact a blessing in disguise. Enzo hired a lot of young engineers to fill
the gap left by his former employees, and these newcomers designed one of Ferrari’s
most iconic grand tourers, the Ferrari 250 GTO. Only 39 of these beauties were ever produced,
which is actually pretty surprising, since the International Automobile Federation required
at least a hundred cars to be built before approving the model for racing. Enzo managed to cheat his way to approval
by numbering the chassis out of sequence and, when the inspectors came to visit, he shuffled
the cars around in different locations. Enzo got the 250 GTO approved, and it ended
up winning the World Sportscar Championship for three years in a row. The few 250 GTOs left in the world have become
extremely valuable. In fact, in 2014 one car sold for over 38
million dollars at the Bonhams Quail Lodge in California. The 1960s ended up being one of Ferrari’s
best decades. They also saw the release of Ferrari’s first
grand tourer equipped with a transaxle, the Ferrari 275, and it’s successor, the Ferrari
Daytona. Towards the end of the 60s demand for Ferrari
cars was becoming so large that Enzo couldn’t build them fast enough. In order to secure investment for the company’s
expansion, Enzo sold 50% of the company to Fiat, which back then and to this day remains
the largest car manufacturer in Italy. With this newfound capital Enzo expanded Ferrari’s
operations, and he even had enough money left over to finance one of his lesser known ideas. He wanted to see whether he could start making
cheaper sportscars that he could sell to a wider audience. He didn’t want to compromise the luxurious
exclusivity of the Ferrari brand though, so he created a new car brand, which he called
Dino, in honor of his firstborn son, Alfredo. Alfredo had died ten years earlier from Duchenne
muscular dystrophy, a rare degenerative disease that progressively destroys the muscles of
the legs, arms, and eventually the heart. Alfredo was only 25 when he died, and at the
time he was developing a V6 engine. Enzo was shattered by his son's death, and
in his honor he created the Dino brand, which featured three main models up until its discontinuation
in 1976. The 206 GT and the 246 GT used the V6 engine
Alfredo had developed, though the 308 GT4 had a more powerful V8 engine. During the 1970s Ferrari won three Drivers’
Championships thanks to the performance of Niki Lauda and Jody Scheckter, but Ferrari
didn’t manage to win that title again for 20 years. The situation further worsened in 1982 with
the death of Gilles Villeneuve in the Belgian Grand Prix. The tragedy shook the racing world, since
Gilles was one of the most popular drivers at the time. In 1984 Ferrari produced the iconic Testarossa,
which shares the name of Testa Rossa from the 1950s, although this model’s name is
spelled as a single word. Surprisingly enough, the Testarossa from the
80s didn’t appear in any official race. Even so it’s still one of the most widely
recognizable Ferraris, since it was featured in the final three seasons of Miami Vice. In 1987 Enzo celebrated the 40th anniversary
of his company by releasing the Ferrari F40, but just one year Enzo’s death cast a bad
light on the model. Speculators quadrupled the price of the F40
in the hopes of profiting from the car’s reputation as the last model personally approved
by Enzo. In fact, estimates from 1990 state that barely
10% of all F40s sold were actually used for driving. Enzo’s death caused a dramatic shift in
the company’s ownership. His only living heir was his second son Piero,
who inherited his father’s 50% stake in Ferrari and promptly sold most of it to Fiat
for an undisclosed sum in exchange for becoming Vice Chairman. In the end, Fiat ended up owning 90% of the
company, with the remaining 10% in the hands of Piero. Despite the death of Enzo, however, the 1990s
turned out to be a revival period for Ferrari’s racing team. In 1993 Ferrari hired a new General Manager,
Jean Todt, who would eventually become the CEO of Ferrari and the President of the International
Automobile Federation. Under his guidance Ferrari acquired Michael
Schumacher in 1996. Now at the time Ferrari’s Formula One team
was in horrible shape: they hadn’t won a single Drivers’ Championship
since 1979, their pitstop crew was a running joke, and their V12 engine couldn’t match
the lighter, more fuel efficient V10s of their competitors. Michael Schumacher’s decision to join Ferrari
was surprising to say the least, although to be fair they did offer him 60 million dollars
for a two year contract. Even today, Ferrari consistently outbids their
competitors to get the best drivers: in the 2016 season, for example, the most
well-paid driver is Ferrari’s Sebastian Vettel, who earns a cozy 50 million dollars
per year. But back to Schumacher. In the 1996 Drivers’ Championship he placed
third by winning three races for Ferrari, which was more than they had won in the previous
five years. Schumacher stellar performance didn’t really
start until the year 2000, when he defeated McLaren’s Mika Häkkinen to win Ferrari
their first Drivers’ Championship in 20 years. He then went on to win the Drivers’ Championship
four more times in a row, becoming the most decorated F1 driver in history. His reign during these five years was unprecedented:
In 2001 he won the Drivers’ Championship with a 58 point lead, and for the next season
his lead was even larger at 67 points. It wouldn’t be until 2005 that Schumacher
was finally dethroned by the up-and-coming Fernando Alonso, who would eventually secure
two titles for Renault. The early 2000s were the time when Ferrari
truly re-emerged on the global racing scene. Schumacher’s performance helped Ferrari
become the team with the most victories in both the Drivers’ and Constructors’ Championships,
an achievement they hold to this day. Ferrari’s highlight car from the period
was the Ferrari Enzo. It was released in 2002 and it became the
first Ferrari to use the new generation of V12 engines, the F140, which is still used
in contemporary models. Ferrari’s latest model is from 2013 and
it is aptly named LaFerrari, with the idea that it is the definitive Ferrari sportscar. With the stunning price tag of 1.4 million
dollars, only 499 LaFerraris have been built so far. Recently Ferrari announced they’d be building
a 500th one to the benefit of those affected by the deadly earthquake that struck Central
Italy in August. Interestingly enough Fiat decided to get rid
of their involvement in Ferrari, and so on January 3, 2016 they took the company public. Although that came as a surprise to Ferrari
enthusiasts, the move was actually pretty calculated. Ferrari had always enjoyed full autonomy from
Fiat’s management team, so the transition wouldn’t be anywhere near as difficult for
them as it would be for a regular company. Fiat also benefits from the split because
they’re short on capital for their expensive plans to reinvigorate their Jeep and Alfa
Romeo brands by 2018. Of course, if you look at Fiat’s share price
it’s easy to see that investors weren’t too happy with the Ferrari spinoff, but it’s
still too early to tell whether the move was actually successful. Ferrari, on the other hand, seem to be doing
great, and they’re currently preparing to release 350 special-edition cars for their
upcoming 70th anniversary. So far they’re planning on making special
editions of their five current models, except the LaFerrari, whose production ends later
this year. There’s not a lot of info out just yet,
but knowing Ferrari’s production team it’s safe to say their anniversary will probably
be a success. Hey everyone, thanks for watching! This is our first video in over a month, so
it’s clear that we had some scheduling issues. I know this is like the third time I’m promising
this, but I think those issues are resolved, so we’ll be going back to our regular release
schedule of one video every two weeks. If you’d like to watch our previous video
you can click over here. It’s about the history of Monsanto: how
they started as a chemical producer and eventually became the largest seed manufacturer in the
world. If you want to watch the full Behind the Business
series, you can click over there, and you can subscribe to our channel by clicking here
in the middle. Don’t forget to follow us on social media,
and as always: stay smart.
Mesut Ozil?
If anyone doesn't already know this guy's channel is awesome. He has videos over the Lego company, Rolex, Bayer, and Monsanto that are all really neat.
I can never figure out where he's from though, that accent is unusual to me.
Great documentary! It's even more interesting how Enzo Ferrari inadvertedly created Lamborghini when he (iirc) refused to meet with a client complaining of a broken clutch. That guy was Ferruccio Lamborghini and he started Lambo just to piss Enzo off LOL
Hey! that guy plays for Arsenal!
And how his arrogance and pride gave us Lamborghini, Spyker, and Shelby.
Too bad Enzo was a bit of a prick
Toby Maguire was great in this
This makes me really want to work for Ferrari lol
Are we all just going to ignore how funny that letter about his wife is?