13.10.2011 ERA AT AN END AS PININFARINA QUITS CAR ASSEMBLY

ALFA ROMEO SPIDER

A huge gamble on taking on a swage of manufacturing contracts that were financially stacked heavily in the favour of its clients - including Ford, Mitsubishi, Volvo and Alfa Romeo (Brera, above) - in the middle of the last decade has brought the Pininfarina to the edge of bankruptcy and into the control of its creditor banks.

A long and often rich history is finally coming to a close as struggling Pininfarina is now laying off the remainder of its contract manufacturing division staff and exiting this activity which has brought the famous name to its knees.

A huge gamble on taking on a swage of manufacturing contracts that were financially stacked heavily in the favour of its clients (including Ford, Mitsubishi, Volvo and Alfa Romeo) in the middle of the last decade has brought the Turinese company to the edge of bankruptcy and into the control of its creditor banks.

Even in its latest accounts the Pininfarina directors still cannot say if the company can remain a going concern in the future and no end seems to be in sight to the problems with no buyer found so far, although a list of high profile names have been linked with buying the remaining businesses, which include its famous design activities as well as the Pinfarina Extra division. Potential suitors include Austro-Canadian car components maker Magna-Steyr as well as several Chinese firms.

Now the division that caused the rot is finally put to rest, although the last of its work had dried up. "Pininfarina S.p.A. announces that, today, it began to carry out the procedures required by current regulations for the purpose of implementing a long-term unemployment benefit plan for termination of production activities and staff downsizing, due to the absence of conditions suitable for continuing to operate the production activities," read a press release issued by the Turinese company.

"The long-term unemployment benefit procedure will apply to 127 employees of the production sector and of directly and indirectly related units. This transaction will result in a direct charge of 2.9 million euros for contributions to social security institutions and indemnities required pursuant to law, plus a payment of about 2.5 million euros to liquidate the provision for termination indemnities, which will be distributed upon completion of the procedure, with no impact on the income statement," the statement concluded.

In April Pininfarina lost its share in Véhicules Electriques Pininfarina Bolloré (VEPB), the innovative electric vehicle project which was developed in Turin and which the firm had hoped to put into production. Pininfarina's partner in the joint venture, French industrial conglomerate Bolloré, took over Pininfarina's stake for 10 million euros (after the Turinese company exercised a 'put' option) as well as its Bairo Canavese plant which is being earmarked to assemble the Bluecar.

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