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FCA’s decision to sell 10 percent of its Ferrari subsidiary and spin-off the rest to shareholders has triggered a debate about how much this storied luxury sports-car maker is worth and valuations vary by around $5 billion.

FCA CEO Sergio Marchionne reportedly believes Ferrari is worth up to $12.2 billion, but analysts estimates are substantially lower. Chicago-based Morningstar analyst Richard Hilgert estimates Ferrari’s worth at $7.4 billion.

Bernstein Research has just published a three-part analysis of Ferrari and its sums point to a value of about $7.3 billion for Ferrari when 10 percent of the shares are sold to the public in the middle of next year.

Bernstein Research’s Max Warburton says Ferrari can’t be valued as a luxury goods outfit as some have suggested. It’s margins are way too low and its capital intensity to high to be valued like a fashion company.

“Its growth rate is lower (than a luxury goods company) – and the need for exclusivity plus U.S. CO2 rules may cap growth going forward, although we await details of any product line expansion with interest. Will it really trade at a premium to luxury goods stocks, as Marchionne hopes?” Warburton said.

Marchionne replaced Fiat chairman Luca Cordero di Montezemolo with himself earlier this year after a dispute about long term sales strategy. Montezemolo was said to want to keep sales at the current level of around 7,000 because any more risked diluting the power of the brand. Marchionne reckoned sales could reach 10,000 without any harm being inflicted.

Annual sales of 10,000 is also the figure likely to be the maximum allowed by the U.S. government for exemption from CO2 fuel efficiency rules.

Some investors think it would be hard for Ferrari to survive on its own because government regulations would outlaw its gas-guzzling engines. Being part of a big manufacturer allowed excessive fuel use to be averaged down.

Warburton expects Ferrari to increase its range with a smaller, cheaper V6 sports car or perhaps an SUV.

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