I've also viewed Ferrari as on the decline, but I don't think they're all that bad off. After narrowly winning both 2007 championships, in 2008 they almost won the WDC (although some poor stewarding at Spa made it closer than it should have been) and won as a constructor. In 2009 they were essentially tied with McLaren far behind Brawn and their double-diffuser domination of at least half a season. In 2010 they almost won the WDC. In 2011 they were a good ways off from the Red Bull, but so was everybody. This year isn't off to the greatest start, especially with Massa pulling so little weight, but Alonso has had a decent start to the season and the season is still young.
Ferrari has still been threatening for wins, so while they aren't dominating I don't see a "demise" here.
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