December 13, 2020

Mahindra to close Pininfarina Engineering as a part of technique to exit loss-making ventures

Mumbai: Mahindra and Mahindra is liquidating Pininfarina Engineering, a unit of its Italian subsidiary Pininfarina, citing strategic irrelevance of the enterprise and poor market visibility.

The choice was taken for “the rationalization and simplification of the company construction of the Pininfarina Group” and the unit was not “thought of strategic” for the event of the group, Pininfarina stated in a press assertion dated 26 October.

That is consistent with Mahindra’s managing director-designate Anish Shah’s effort to exit loss-making ventures that don’t maintain strategic significance.

The corporate has to this point exited US-based electrical bike maker Genze and Australia-based small plane producer GippsAero and determined to promote the bulk stake in its South Korean subsidiary SsangYong on the block.

The choice to liquidate Pininfarina Engineering got here after it incurred losses to the tune of € 150 million (Rs 1,340 crore, approx.) after two worldwide tasks fell by way of, one every with an Iranian and a Chinese language firm, Italian media reported.

Pininfarina Engineering is a subsidiary of Mahindra’s listed Italian automotive design arm Pininfarina. It was established in 2018 as a “turn-key” or full automobile growth firm.

Mahindra group stated that Pininfarina will stay targeted on its core competencies of design and engineering. “We’re working below difficult circumstances because the state of affairs for the automotive sector continues to be tough as a result of affect of COVID-19. The enterprise must proper dimension consistent with the market state of affairs and the enterprise will endeavour to assist the workers for re-allocation to minimise social affect,” learn an extract from Mahindra’s emailed response to ET’s queries.

About 135 jobs at Pininfarina Engineering are on the road and the impacted workers took to the principle sq. at Turin, the place the corporate is predicated, to protest the liquidation, native media reported.

Commerce unions and Pininfarina administration have reached an settlement to relocate about 70 workers to the mum or dad firm and to a different Turin-based firm, in line with a report from Corriere Torino.

“We fail to grasp why the corporate can’t be reorganized and managed in a manner that has aggressive prices. We can not imagine that for Pininfarina Engineering Srl there aren’t any extra revenue margins, as the highest administration claims,” learn an open letter from the protesting workers to Mahindra and Mahindra’s high administration.

“We don’t perceive how this determination suits in with the moral and social tips at all times declared by the Mahindra Group and its president.”

The workers additionally wrote a letter to the Italian Minister of Labour and Social Insurance policies Giuliano Poletti

Mahindra and Mahindra and Tech Mahindra jointly-acquired automotive design agency Pininfarina in 2015. The corporate has designed vehicles for iconic carmakers like Ferrari, Alfa Romeo, Maserati and Peugeot.