Ferrari’s share price surges in wake of Lewis Hamilton’s bombshell move
Lewis Hamilton’s decision to join Ferrari sent shockwaves through the Formula 1 community and has triggered a remarkable surge in the team’s share price on Thursday.
The Scuderia’s stock catapulted over 10 percent, translating to an impressive boost of just under USD$7 billion (£5.48 billion) on the New York Stock Exchange.
Late on Thursday (European time), Mercedes officially announced that the seven-time world champion, who clinched six of his titles with the Silver Arrows (he won his first in 2008 while with McLaren), had invoked a break clause in his recently signed two-year contract. This strategic move positions Hamilton to replace Carlos Sainz at Ferrari in 2025, leaving Sainz in search of a new team for the upcoming season. Hamilton will join forces with Charles Leclerc, forming a formidable duo for the iconic Italian racing team.
The immediate and substantial surge in Ferrari’s company value dispelled any uncertainties about the financial advantages of Hamilton’s move. On Thursday, the share price reached a peak of $384.00 on the NYSE, propelling the Scuderia’s estimated market capitalisation to $69.12 billion – an impressive surge of nearly $7 billion from the previous day’s closing.
While Hamilton’s transfer is undoubtedly a contributing factor to Ferrari’s financial upswing, other elements such as the sale of higher-priced cars, robust sales in key markets like the United States and China, and an uptick in personalised features also played a role.
Hamilton, renowned as one of the most marketable sports figures globally, commands a significant influence as an ambassador, having closely collaborated with Mercedes’ car brands and major sponsors. With an annual salary of approximately £40 million, the 39-year-old Briton boasts a net worth of £300 million, according to the Sunday Times Rich List.
Scuderia Ferrari is pleased to announce that Lewis Hamilton will be joining the team in 2025, on a multi-year contract. pic.twitter.com/moEMqUgzXH
— Scuderia Ferrari (@ScuderiaFerrari) February 1, 2024
Despite signing a new contract with Mercedes last summer, expressing his apparent desire to prolong his association with the Silver Arrows, 2024 will mark Hamilton’s 12th and final season under the leadership of Toto Wolff. Eager to conclude his Mercedes career on a high note alongside teammate George Russell, Hamilton faces the upcoming season with renewed vigour.
After winning four straight F1 Drivers’ Championships from 2017-20 to equal Michael Schumacher’s record career total of seven, Hamilton was pipped in dramatic and controversial fashion by Max Verstappen in the last race of the 2021 season.
Red Bull Racing’s Verstappen has gone on to clinch two emphatic world title wins in 2022 and ’23, while Hamilton has failed to win a race in the past two seasons. He finished a career-low sixth overall in 2022 but improved to third behind Verstappen and Red Bull teammate Sergio Perez in a more consistent 2023 campaign.
Ferrari dominated the Formula 1 scene during Schumacher’s early-2000s heyday but has not produced a world champion since Kimi Räikkönen’s 2007 triumph, while the last of its record 16 Constructors’ Championships was in 2008, with Red Bull and Mercedes creating a duopoly on the title in the past 14 seasons.
The eagerly anticipated 2024 F1 season kicks off in Bahrain from February 29-March 2, setting the stage for an exciting conclusion to Hamilton’s tenure at Mercedes.