Ducadi Case

IES168

DG-1507-E 0-306-074

Ducati: In Pursuit of Magic (A)

On the first business day of January 2006, Federico Minoli pulled up and parked his Ducati Multistrada motorcycle in front of the Ducati headquarters in Bologna, Italy. As he looked up at the complex, which housed offices, the assembly factory and the Ducati museum, he reflected back on the company’s history. 2006 would mark several anniversaries: 80 years since Ducati was established to produce electronic radio equipment; 60 years since Ducati had been producing motorcycles; and ten years since Minoli had become the company’s CEO. Minoli joined the then near bankrupt Ducati in 1996, and led its turnaround by creating the “World of Ducati,” a world that involved superior engineering, Italian heritage, slick design and an undeniable attraction for racing enthusiasts to “join the tribe” and become “Ducatisti.” Revenues moved from €95 million to €380 million from 1996 to 2000. EBITDA improved from a loss to €60 million in the same period. However, in the five subsequent years, business results stalled: revenues fell 2.3 percent on a compound annual growth rate from 2000 to 2005, and EBITDA fell to -€273,000 at the close of 2005.

This case was prepared by Jordan Mitchell, Research Assistant, under the supervision of Professor Bruno Cassiman as the basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation. November 2006. Copyright © 2006, IESE. To order copies or request permission to reproduce materials, call IESE PUBLISHING 34 932 534 200, send a fax to 34 932 534 343, or write Juan de Alós, 43 - 08034 Barcelona, Spain, or iesep@iesep.com No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means - electronic, mechanical, photocopying, recording, or otherwise without the permission of IESE. Last edited: 11/17/06

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