Audi Scoops Up Ducati. The Backstory.

The German car company Audi has added Ducati motorcycles of Italy to its universe bringing it under the Volkswagen empire. In a strict business sense, it's a strange move as this piece explains. Ducati is too small and specialized of a manufacturer to matter on VW's bottom line.

So what gives?

As is sometimes the case, it's all about prestige. Ducati is a legendary manufacturer (much like Moto Guzzi and Aprilia); specifically in motor racing. There, Italian bikes manage to compete with Japan.

However, when it comes to capturing customers in a global competitive market, Japanese bikes rule. I don't know if this is by choice or simply a fact that Ducati was unable to mass produce through economies of scale.

 Hence, they (Italian companies) remain small, mostly specialized artisan based companies relying in some cases on subsidies leaving them too inefficient to compete on the global stage. Ferrari, Maserati, and all the other famous brands are not "priced to mass market" but cater to a specific high-end clientele.

If this be the case, we can see natural synergies between a company that mass produces and a unit that remains specialized. The Italian brand in cars, bikes, boats and motorcycles still carry a powerful luxurious image.

Enter the Germans.

There's always been, I think, a mutual fascination between Italy and Germany. As far as I can tell, this goes back to the days when Germanic tribes crossed the limes into Rome. Even in the literature of the time we hear about the "physical attributes of the strong German" and "wily, tactical intelligence of the Romans" later adapted to "Italian" by Machiavelli who touched on this in The Prince.

Presently, there may be something wedged deep within the psyche of each. In the Germans, the Italians may see traits and characteristics - efficiency, work ethic, and engineering - that was once were cornerstones of the mighty Roman empire. They see something in the Germans that's a part of their heritage. Engineering remains a part of the Italian identity but it is in Germany they see it at its apex. In Germany, they respect it. Not so sure if they do in Italy. In the Italians, the Germans see a part of their own identity oft overlooked. Once upon a time, the Germans were noted for their art and musicianship. It was under the guidance of Von Bismarck they became known for being a militaristic society too easily succumbing to authority. Germans see a wild side in Italy where authority is an option.

During and after the fragmentation of Rome, German kings and leaders sought to be accepted into Roman civilization. There wasn't, for the large part, a motive or interest to conquer and impose their culture for they knew they were entering a far superior society. The merely sought to integrate. The power of Rome's aura was too great. This held true well after Rome's said fall in 476 AD.

When Charlemagne rose to power he laid down the first attempt at uniting Europe before there were nation-states under the banner of the Holy Roman Empire where Italy was seen more as a prestigious trophy to hold rather than a conquered land. And so it went through the ages. Call it a Holy Grail of sorts. If you were to own and operate an empire you have to possess Rome no matter how insignificant to the grand scheme of things.

Alas, Charlemagne's European Community was not to be and would not be achieve (tenuously) until 1000 years later (perhaps too late?), and nations consolidated power into Monarchies and became England, France, Spain etc. but the mystique of Rome lasted right up to the 20th century with Mussolini's (who founded Fascism and help form the Axis alliance. A man even Hitler admired) promise of a "return to Rome" and Adolf Hitler's use of Roman symbols. Even Hitler seemed to have a soft spot of the "Italian mind."

Europe, for the most part in its early stages of greatness (say the 13th to 15th centuries), were largely a local affair. You weren't really English or French. You were Christian from London or Provence. The subsequent competition between the city-states splendidly shown in Renaissance Italy is what drove the continent to unsurpassed excellence in world affairs.

As most of Europe consolidated into various nations and empires, Italy and Germany were to remain fragmented, regionalized city-states until the 19th century. Another common feature they share.

With that brief, hopefully lucid and accurate background, perhaps we see why Audi buying Ducati is really just another moment in the long relationship between the two cultures.

One can still wonder how can the Germans and Italians get along despite all this?

Quite well, in fact. There simply is a willingness to cooperate. Perhaps there are examples to the contrary, I don't know.

Call it one of those strange glitches during the long course of European history.

All this to say, I just made a simple business transaction more complicated than it really is.