Lamborghini: Never Insult a Tractor Tycoon

Previously on Behind the Business, we looked at how an Italian blacksmith took the automotive world by storm. Like many great innovators, Enzo Ferrari was a demanding, proud and energetic man. It is precisely this incendiary mix of personality traits that eventually and rather amusingly led to the creation of Ferrari's biggest rival and the subject of this week's Behind the Business video: Lamborghini. As with Enzo Ferrari, the story of Lamborghini takes us once again to the province of Emilia-Romagna, in northern Italy, to the quiet municipality of Renazzo di Cento. It was there that poor grape farmers Antonio and Evelina Lamborghini raised their son Ferruccio among the family vineyards.

Young Ferruccio was born a Taurus, although you'll see why this is important a little later. More importantly, he was born in 1916, right in the middle of World War I. Despite this, Ferruccio grew up hopeful and ambitious, but like most poor Italians in the early 20th century he faced a crucial dilemma. He could stick with traditional employment as a farmer or he could try to stay ahead of the curve and take a chance on industrial and factory jobs. For Ferruccio, however, the choice was clear: he was obsessed with machines and could barely stay away from his father's garage.

This eventually led him to study mechanics and in 1935 he felt confident enough to open his own workshop. However, five years later, Ferruccio was torn from his civilian life thanks to World War II. He was recruited by the Royal Italian Air Force in 1940 and assigned as a mechanic to the garrison on the Greek island of Rhodes. In carrying out his duties, Ferruccio gained valuable experience in dismantling and reusing old machinery. In 1943, however, after Italy surrendered, a German formation forcibly took over the garrison and dislodged its former allies. Ferruccio could have left, but he decided to stay as a civilian and with the permission of the Germans began managing his own workshop.

As much as the Germans loved Lamborghini's technical aptitude, along came 1945 and with it came the Allied forces. They took all the members of the garrison prisoner, but after seeing what Ferruccio could do, they put him to work fixing their vehicles for a year until he was finally sent home in 1946. Upon returning to Italy, Ferruccio opened another repair shop. short duration. but soon after a brilliant idea occurred to him. His experience with both Allied and Axis vehicles gave him a powerful advantage over most other mechanics. He knew that postwar Italy would need to increase its agricultural production to repair the wounds of war, and what better place to get the machinery to do so than the enormous reserves of military equipment that Mussolini's government had commissioned?

Ferruccio's ambitious plan was set in motion at the end of 1947, when he founded his first company. With only three other mechanics and 2,000 lire of start-up capital, Ferruccio took the large-scale production of affordable

tractor

s into his own hands. His main supplier was ARAR, the state-owned company responsible for selling all surplus military equipment left after the war. By taking an old British Morris engine and modifying it to run on cheap diesel instead of expensive gasoline, Ferruccio created an innovative and affordable

tractor

that he could sell throughout Italy. This was to be the first of their "Carioca" tractors, presented on February 3, 1948 and Italy went crazy for them.

The design was so successful that Ferruccio founded a second company, Lamborghini Trattori. He hired four new workers, bought a factory in Cento and borrowed 10 million lire backed by his family's grape farm to buy hundreds of Morris, Perkins and Dodge engines from ARAR. He also decided to participate in a prestigious endurance race called the Mille Miglia. He was driving his reconditioned Fiat Topolino, but crashed into the side of a restaurant and stopped racing for the rest of his life. Despite this, his company was doing very well and by 1950, Trattori had a staff of 30 people and could produce more than 200 tractors a year.

Demand grew rapidly and in 1951 Ferruccio acquired 1,000 m2 of land on which he built a new factory. Also introduced in 1951 was the L33 tractor, whose popularity would benefit greatly from government subsidies to farmers using domestically manufactured machinery. After signing an agreement with Motorenwerken Mannheim for its diesel engines, Lamborghini could now produce tractors completely on its own. Ferruccio's new factory produced his first tractor in 1956 and by that time he had already simplified his engine design to around three horsepower levels. Ferruccio also crossed the Atlantic to purchase heating and air conditioning technologies in the United States. In the early 1960s, Lamborghini's tractor factory had 400 employees producing up to 30 tractors per day.

Some of its biggest developments during that era were a series of air-cooled tractor engines and even helicopter concepts, although the government

never

approved them. In 1961, Ferruccio opened an independent diesel heater factory and at that time he was so rich that he decided to indulge his love of sports cars. As a mechanical scholar himself, Ferruccio was very critical of any engineering flaws he found in any of the cars he owned. Among them were two Alfa Romeos, two Maseratis, a Jaguar E-type, a Mercedes Benz and, of course, several Ferraris. Ferraris especially appealed to Ferruccio, but he found them unnecessarily noisy and he thought they had a basic interior.

He was particularly exasperated by the peculiar tendency of Ferraris to constantly have clutch failures. After finally growing tired of all the repair bills, Ferruccio took the problem vehicle directly to Modena, where he personally confronted Enzo Ferrari about the clutches. According to Ferrucio, Enzo basically ignored him and told him to continue driving tractors. That's not very surprising coming from the man who fired most of his senior staff when they complained about his wife, but Ferruccio saw it as a challenge. Aware of the benefits that could be obtained from the grand tourism industry, in 1963 the tractor magnate founded a car factory near Sant'Agata.

Thus, out of the primordial desire to show the middle finger to Enzo, Ferruccio created Automobili Lamborghini. For the brand's emblem he chose a bull: after all, it was his astrological sign and he also had a deep fascination with bullfighting. This rather fearsome creature proved to be an apt representation of Lamborghini's company as it moved towards milestones year after year. The first Lamborghini in operation, the GT 350, was created in 1964 with the help of the young engineer Paolo Stanzani. It featured extremely impressive technology, including a V12 engine, five-speed transmission, four-wheel disc brakes, and four-wheel independent suspension. Creating the GT 350 was not easy and its prototype suffered from some serious design flaws that became very evident during its hasty entry into the 1963 Turin motor show.

The most notable problem was the fact that the engine itself didn't even fit inside the car's body panels. Ferruccio's solution was to fill the compartment with bricks and keep the lid closed at all times. After all, the show was about looking at cars, not driving them. In the end, the GT 350 was a technical masterpiece and won praise from critics and customers alike. In 1966 the 400 GT and the Miura P400 appeared. The Miura was especially notable for establishing the rear mid-engine layout as the standard for all performance cars of the era, a standard that is still used today.

It was originally developed as a street racing vehicle by a team of bold engineers led by Marcello Gandini. They kept the project a secret from Ferruccio, as he was against building racing cars due to his own racing incident in 1948. When Ferruccio heard about the new design, he was delighted enough not to scrap it, but he doubled down. for not competing. policy. In 1968, the Espada established itself as one of Lamborghini's great classics along with the Islero 400 GT. The company continued its streak of success, launching famous models such as the Countach LP500, the Urraco P250 and the Jarama 400 GTS.

The 1970s, however, would be a difficult time for Lamborghini. In 1973, two years after the abolition of the Bretton Woods system, the world stock market experienced a dramatic crash, with the Dow Jones erasing almost half of its value. At the same time, OAPEC initiated an oil embargo, which greatly raised the price of fuel and plunged the automotive world into its own crisis. As if all that were not enough, Lamborghini Trettori was also hurt when a deal to supply Bolivia with 5,000 tractors was canceled after Hugo Banzer's 1971 coup. Ferruccio did his best to keep his various businesses alive: he eventually found buyers for unsold tractors and also moved his diesel heater factory to Dosso, in Nigeria.

In the end, he was forced to sell Lamborghini shares to outside investors to save his business from bankruptcy. The crisis broke Ferruccio and, although he managed to save Lamborghini, he retreated in the face of widespread strikes and unionization that had spread throughout Italy. In 1973 he sold the Trattori business to another Italian tractor manufacturer. A year later he sold the remaining 49% of his stake in Automobili Lamborghini to a Swiss businessman: René Leimer. A friend of René's had previously purchased the remaining 51% and together they hoped to revive the brand. Despite their attempts, they failed and eventually Automobili Lamborghini was forced to liquidate.

In 1980, the Italian government sold Lamborghini for $3 million to the Mimran brothers, two French businessmen who owned huge sugar cane plantations and flour mills in Africa. The brothers ambitiously wanted to renovate all of Lamborghini's facilities and form a new team of engineers, but they quickly went over budget and ended up selling the company. In 1987 Lamborghini passed into the hands of Chrysler, which wanted to import the luxury car brand to the United States. However, less than five years later, Lamborghini still had not turned a profit, so Chrysler sold it to an Indonesian conglomerate. In fact, the Indonesians managed to restore the brand a little and in 1996 Lamborghini made a modest profit of $120,000.

As luck would have it, in 1998 a financial crisis hit Asia and Lamborghini was sold again. This time, the buyer was Volkswagen's Ferdinand Piëch, who had also bought Bentley and Bugatti the same year. Under the paternal care of Volkswagen, Lamborghini found its structure greatly simplified. This allowed it to finally begin to regain its place in the luxury sports car market. To meet the challenges of the 21st century, Lamborghini has aggressively marketed its brand while investing heavily in materials research and development. They have diversified their cars to appeal to a wider range of budgets, although even their lowest prices are still prohibitively expensive for the average Joe.

The pinnacle of modern Lamborghini's success is undoubtedly the Gallardo, which, over the course of its ten years of production, sold just over 14,000 units, thus becoming Lamborghini's most popular design. 2015 marked the best year in the company's history, as its sales increased from just over two and a half thousand cars to more than 3,000. They are already manufacturing other heavyweights such as the Urus SUV concept or the Huracán, successor to the Gallardo. So far it looks like Lamborghini's corporate hot potato game has finally come to an end, at least for the moment. However, it's safe to say that if Ferruccio could see his company now, he would be pleased to know that Lamborghini is once again playing the red flag against the Ferrari bull.

This video was supported by viewers like you on Patreon, and for a donation of just $5 you can vote on which company we cover next. Impressive, right? We also encourage you to visit our subreddit. If you found a mistake in the video and want to rub it in our faces or if you just want to chat with us, that's the place to do it. Of course, you can also follow us on other social networks, we have a Facebook page that you can like and a Twitter profile that you can follow. If you haven't seen it, I recommend watching our previous video on the history of Netflix, from its origin as a DVD mailing service to its emergence as the world's preferred movie streaming platform.

We also have a playlist of the entire Behind the Business series in case you want to check out some of our older videos. Thank you so much for watching and as always, be smart.