Pininfarina Finds a New Owner and a New Lease on Life
In August, we took a look at what was going on at Pininfarina, the iconic Italian coachbuilder responsible for some of the most iconic and beautiful cars of all-time. As we said then:
“The [Ferrari] Testarossa, California Spyder, Daytona, F40, and Dino all wear Pininfarina’s fender badge, and for those of you who aren’t familiar with the company’s automotive oeuvre, its industrial design wing styled that fancy computerized Coke machine that seems to be everywhere too. But despite a portfolio consisting of dozens of beloved cars, the 2006 Winter Olympics torch, and a host of trains, buses, hotels, among other projects, the company is in serious financial trouble.”
Over the summer, it was reported that Indian manufacturing powerhouse Mahindra was working on a proposal to buy the storied company. This week, a deal worth $185 million has been agreed to after nearly a year of negotiations. And a new owner – along with an influx of cash – could be the best thing to happen to Pininfarina in a very long time.
The coachbuilder hit hard times last decade when its manufacturing contracts with Peugeot, Alfa Romeo, and Volvo lapsed, and as longtime clients like Ferrari have begun to rely more on in-house design and manufacturing, Pininfarina has run into dire straits fading in and out of financial solvency since 2008. But with recent projects like the BMW Gran Lusso coupe and Ferrari Sergio, it’s proven that it can still design some of the most beautiful cars in the world.
This could prove to be a valuable asset for Mahindra, a massive corporation that deals with everything from IT to heavy manufacturing as it seeks to expand its footprint in the international auto market. Pininfarina will technically be owned jointly by Mahindra & Mahindra (it’s automotive arm) and Tech Mahindra, though it will remain a separate, publicly-traded company run by Paolo Pininfarina, grandson of Battista Pininfarina, who founded the company in 1930.
Mahindra’s first order of business is to get Pininfarina solvent again, and that means $125 million of the deal goes directly to creditors; $28 million will go to buy 76.5% of Pininfarina shares from its current owner, the Pincar holding company, with the rest of the sum going to investments. Mahindra will make an offer to buy the remaining shares after the deal is finalized in 2016.
In recent years, Mahindra has developed a reputation for saving struggling automotive brands, most notably South Korean automaker Ssangyong and PSA Peugeot-Citroën’s motorcycle arm. The coachbuilder’s know-how could be a near-instant asset for Ssangyong, who has a reputation for building some of the most, um, aesthetically-challenged cars in the world.
But Pininfarina isn’t likely to become a behind the scenes player. Speaking with Road and Track, Krishna Bala, VP and head of automotive and aerospace business at Tech Mahindra said ” The Ferrari relationship will continue. The Maserati relationship will continue, all of [Pininfarina’s] relationships will continue as-is.”
Ssangyong and Mahindra-badged cars and trucks are popular in Asia and Europe, but the company is virtually unknown in North America aside from its tractors. That may change however, as rumors are beginning to swirl that between the company’s design expertise, Tech Mahindra’s R&D facilities, and Mahindra & Mahindra’s manufacturing capabilities, the coachbuilder could eventually launch its own line of premium luxury and sports cars, making them the first cars to solely wear the Pininfarina badge since the 1983-’85 Sport Spyder, a continuation of the Fiat 124 Spyder.
In a press release issued about the deal, Mahindra says:
“Pininfarina’s philosophy of Purity, Innovation and Elegance will find a perfect fit with Tech Mahindra’s world of connectedness – where design & styling will, hand in hand with engineering services, go after a larger market.”
With Mahindra’s growing presence in the automotive world, and its very deep pockets, we’re just glad Pininfarina’s philosophy will continue to grace some of the world’s most beautiful cars for years to come.
Like classics? It’s always Throwback Thursday somewhere.
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