Industrie Pininfarina: The New Customer Decision

 Assumptions & Scope

Industrie Pininfarina is known for participating the designing and manufacturing of some of the most popular cars known to date; Alfa Romeo Spider Duetto, Fiat Coupe and Bentley Azure among others. This leads to the general assumption that the manufacturer is a power house in vehicle production, which to some point was. However, after close observation, it is evident that the company was not well invested in mass production of cars meaning that the designs the company produced would be what is referred to as limited editions today. The expansion proposal by Mitsubishi seemed easy for the company to accept. This was not the case as the case study by Professor Nell Jones documents in, Idustrie Pininfarina: The New Customer Decision. (2011)

The scope of this writing is on the ability of the company, Industrie Pininfarina to accept a new customer, satisfy the demand of mass production, transportation of the raw materials as well as expansion of their production capability while maintaining high quality products (Jones, 2011). This is a business undertaking that should be seen to help the company grow into a diversified motor vehicle manufacturing company in Italy.

Major Issues

  • The first major issue at this point is the viability increasing production volumes the company being a niche manufacturer. The company has been producing small volumes of cars with the maximum standing at 17,000 for the Fiat Coupe. At this point, Mitsubishi proposing that the company manufacture the Pajero Mini to supply the whole of Europe. This would mean that the company has to increase the production space, resources and work force for the project (Jones, 2011).
  • The company had to re-organize their operations to ensure that future manufacturing technology and client needs are being catered for. The aspect of quality in the proposed model by Mitsubishi challenged the company. This is because the company did not have a clear description of what a defect in car that they have not designed looked like.
  • There was the issue of logistics and supply of the parts to be used in the manufacturing. The supply of these parts had to be pre-arranged and negotiated by Industrie Pininfarina. The volumes of orders made it difficult to negotiate for lower prices from the suppliers. This ultimately meant that the manufacturer had to find another way of producing to ensure quality is maintained while at the same time, the profit margins are increased.


  • Estimate the amount of capital that the company requires to contribute to the project; the expansion of production and the workforce required to effect the same.
  • Understand how the partnership is beneficial to Industrie Pininfarina. This is the profit margins and infrastructural benefits that the company will get from the partnership once the project is completed.
  • Understand how the various manufacturing processes are likely to be altered in the process of satisfying the goals of Mitsubishi in the European market.


  • I recommend that the manufacturer accept the proposal by Mitsubishi as a new customer. This will mean that the old set up of the company would have to be switched up, the space for paint more cars; more workers to work in the manufacturing and more advanced equipment will have to be bought. For a niche company to venture into such investment is a risk but when the project pays off, the company remains better off. The company, therefore, should be encouraged to take the deal and produce the Pajero mini in Europe (Mitsubishi Motors, 1999).
  • I would recommend that the company communicate with Mitsubishi to ensure that the definition of quality and defects were well explained. This would mean that the Mitsubishi Company as a new customer would give Industrie Pininfarina the clear cut definition of the product they wish to put out to the market. At the same time, Mitsubishi would offer nuggets of wisdom on the manufacturing after having carried out a similar project previously.
  • The company would benefit in being introduced to the parts suppliers. For the company, this is a major milestone. I would recommend that the company accepts the proposal to produce the Pajero mini, then once this production is over, the company will have created links with suppliers for future use. Mitsubishi will have helped the company to expand their networks in terms of trade.

Analysis and Conclusions

Industrie Pininfarina had reduced the production output by the year 1996. This is the time during which Mitsubishi approached the management with a counter proposal where the company looked to sub-contract Pininfarina to produce the Pajero mini for Europe. The company’s performance in 1996 had reduced greatly compared to that of 1992 due to the changes in the supplier’s technology of production of car parts. The decline in performance is evident when looking at the average production per hour in the two years. In 1992 60 cars per hour were produced which is quite a high number compared to the 42.5 cars per hour in 1996 (Jones, 2011). This is a 29.1% decline in productivity. All factors remaining constant means that the production of the company needed to be turned around. 

In conclusion, the company needed a top-down intervention to change the situation. The management needed to see why the production was low and whether the partnership with Mitsubishi was going to change the situation. The levels of specialization needed to be leveled up. More employees needed to be trained on working a specific part of the company. This means that the company will produce faster because each employee has a specified role in the company. The management will also have to be diversified to ensure that the partnership will be beneficial to all three parties; the clients, Industrie Pininfarina and Mitsubishi.


Jones, N. (2011). Industrie Pininfarina: The New Customer Decision. Ontario: Richard Ivey School of Business Foundation.

Mitsubishi Motors. (1999, March 2). Mistubishi Pajero Pinin Compact SUV. Retrieved from Mistbishi Motors:

Order a unique copy of this paper
(550 words)

Approximate price: $22

Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

At Solution Essays, we are determined to deliver high-quality papers to our clients at a fair price. To ensure this happens effectively, we have developed 5 beneficial guarantees. This guarantees will ensure you enjoy using our website which is secure and easy to use.

Money-back guarantee

Most companies do not offer a money-back guarantee but with Solution Essays, it’s either a quality paper or your money back. Our customers are assured of high-quality papers and thus there are very rare cases of refund requests due to quality concern.

Read more

Zero-plagiarism guarantee

All our papers are written from scratch and according to your specific paper instructions. This minimizes any chance of plagiarism. The papers are also passed through a plagiarism-detecting software thus ruling out any chance of plagiarism.

Read more

Free-revision policy

We offer free revisions in all orders delivered as long as there is no alteration in the initial order instruction. We will revise your paper until you are fully satisfied with the order delivered to you.

Read more

Privacy policy

All data on our website is stored as per international data protection rules. This ensures that any personal data you share with us is stored safely. We never share your personal data with third parties without your consent.

Read more

Fair-cooperation guarantee

Ordering and sending money to us is an indication that you are purchasing our products and services. To have business talks laid out in the official language, you can check on our terms and conditions and get more information about this.

Read more

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Order your essay today and save 20% with the discount code: LEMONADEPlace Order