INDUSTRIE PININFARINA: THE NEW CUSTOMER DECISION
The 25th of April is a national holiday in Italy, but it was not for Industrie Pininfarina (Pininfarina) top management in 1996. A meeting between Pininfarina and high level Mitsubishi executives lasted the entire day. The following day, a Friday, Renato Bertrandi, manager of operations at Pininfarina, sat in his office at the Pininfarina plant at Grugliasco, in the Piedmont region of Italy. In a rare quiet moment, he reflected on the challenges that lay ahead for the manufacturing operations. On Monday, he would recommend whether Pininfarina should accept European manufacturing responsibility for a new vehicle, the Mitsubishi Pajero. The vehicle presented both a major opportunity and a significant commitment, which would impact Pininfarina's fortunes through the year 2004 and beyond and it would require major changes in manufacturing. The contract would virtually double Pininfarina's output. Once again, Bertrandi thought through the company's options and tried to evaluate the near term benefits and challenges to manufacturing as well as the longer term consequences. He thought with satisfaction about the many achievements in manufacturing since the 1980s. An active triathlete, he wondered where the next phase of the competitive race in the changing global automotive industry would leave the company.
In 1904, at the age of eleven, Battista "Pinin" Farina began work in his brother's coach-making business -which also specialized in making seats for racecars. After long experience in the emerging and rapidly expanding Turin automobile industry, he founded his own company in 1930. Pinin specialized in the design and production of custom and small series automobiles. While he expected to build relatively few "special" cars and was rooted in a tradition of highly skilled craftworkers, he was much impressed with the Ford system, which he had seen on a plant tour in the United States in 1920. The visit contributed to his conclusion that he had to draw on the strengths of Ford's method to be successful. As he would later say, I was looking for a third state, between the craft we had to leave behind and industry. The state had to have industrial norms and structures but it must not suffocate that individual reality, which can be defined as style. There was no tradition to which we could appeal, our occupation was brand new and we paid for any mistakes we made in person. The company soon earned a reputation for the quality and beauty of its designs. By 1939, Farina Industrie employed over 500 workers and manufactured close to 800 automobiles. For a period of time during World War II, the company product line included ambulances, airline seats, and stoves, but it returned to a focus on automobiles after the war ended. And, it was in automobiles where it continued to find its greatest success - producing revered designs such as the Ferrari Berlinetta Dino and the Alfa Romeo Spider Duetto (Exhibit 1). Farina's Cistalia automobile, designed in 1947, was celebrated in a collection of mobile sculptures at New York's Museum of Modern Art. In 1954, after the great success of the Alfa Romeo Spider, the company added facilities to manufacture lower volume cars for major automobile manufacturers. To handle an increasing demand, in 1958 the company moved from Turin to a manufacturing plant in Grugliasco, a nearby suburb. Upon Pinin's death in 1966, management of the business was taken over by Pinin's son Sergio and his son-in-law Renzo Carli. The family name and that of the business were changed from Farina to Pininfarina by presidential decree. 1
Troughout the 1960s and 1970s Pininfarina continued to design and produce unique automobiles such as the Ferrari Berlinetta, the Lancia Flaminia, the Austin A 40, and the Morris 1100. By 1972, the company employed about 1900 people and was producing more than 23,000 cars per year. In 1979, Pininfarina split its design...
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