Ferrari NV will embark on a major shift toward electrification by turning its historic factory in northern Italy into a hub for battery-powered cars, underscoring how even the most pure-bred makers of combustion engines are embracing an electric future.

The Italian manufacturer will invest about 4.4 billion euros ($4.6 billion) to develop fully electric and plug-in hybrid models that will make up 60% of its portfolio by 2026, Ferrari said on Thursday during an presentation to investors that included a new forecast for higher profit.

Ferrari will expand its Maranello plant to make electric cars.

“We have all the skills, all the capital,” to successfully manage the electric transformation, Chief Executive Officer Benedetto Vigna said during a presentation at the Maranello site. 

Vigna was brought in last year to speed up Ferrari’s transition away from the 12-cylinder combustion engines that have been the hallmark of the carmaker for decades. While the company continues to command enviable profit margins, its shares have underperformed recently, in part due to investor concern that Ferrari is late to the EV race and the costs associated with catching up.

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Ferrari expects adjusted earnings before interest, taxes, depreciation and amortization to climb to as much as 2.7 billion euros in 2026, up from about 1.5 billion euros last year.

The firm said it will expand its Maranello plant to make EVs and assemble batteries, confirming an earlier Bloomberg News report. Ferrari will introduce its first fully electric car in 2025. Still, about 25% of Ferrari’s investment in 2025 will go toward traditional combustion engines, while full-electric cars will get about 35% of total spending, up from 5% this year.

The company also provided more details on its first sports utility vehicle, the Purosangue, due to be unveiled in September. The model would mark a dramatic departure from Ferrari’s low-slung, two-door supercars. Other manufacturers, from Porsche to Lamborghini to Bentley, have shown that pushing into that niche has expanded the brands appeal to a wider clientele.

Still, Ferrari executives said they’ll remain mindful of keeping the exclusive cachet of the brand, emphasizing the company’s creed that it will always produce one car less than the market wants in order to maintain an air of desirability.

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