At a time when much of Italian industry is struggling to remain globally competitive, $830 million Brembo is going strong. It sticks to the high end -- Porsche, Ferrari, Jaguar, Lamborghini and Ducati -- while rivals TRW and Continental cast their nets wider. Design-conscious buyers, some of whom will pay $15,000 to outfit a motorcycle with Brembo racing-quality brakes, proudly display the logo and brightly colored calipers. "The brakes from Brembo deliver an appealing, crisp, tight response. They are top-of-the-line," says Jan M?nchhoff, a top engineer at Audi, which outfits its RS6 and RS4 sports cars with Brembos.
Superior performance doesn't come cheap. Brembo plows 6.5% of its annual revenue into research and development. At Bergamo's $365 million science park funded in part by Bombassei, Brembo churns out its newest product under a joint venture with DaimlerChrysler Corp. (DCX
). The disks in the new carbon ceramic brakes last up to 10 times as long as regular cast-iron brakes. A host of Ferrari models are now outfitted with the new Brembo brakes, and Mercedes is using them on its $400,000 McLaren SLR.
Innovation, says Bombassei, is one of the ways Brembo has managed to stay competitive, despite a strong euro and Italy's sky-high labor costs. The company recently added motorcycle maker Harley-Davidson Inc. (HDI
) to its high-octane roster of clients. Antonio Tognoli, an analyst at ING Bank (ING
) in Milan, expects Brembo's revenues to climb 8% this year, to $897.8 million. "This company is extremely well-managed," says Tognoli. But rising prices for scrap steel and the cost of consolidating three of its four Italian factories will keep profits flat, at $42.4 million. Nonetheless, the stock is up nearly 11% this year.
More than half of Brembo's 2,750 line workers are outside Italy, at plants in Brazil, Britain, China, Mexico, Poland, and Spain. The company is also building a foundry in Poland. "It takes much less time to open a factory there than in Italy," says Bombassei. It's that sort of opportun-ism that will help the Italian marque keep speeding ahead, even as other Italian companies slip into the breakdown lane. By Maureen Kline in Bergamo, with Gail Edmondson in Frankfurt