However, the design firm's growth has lagged Tech Mahindra's since the acquisition. Its revenue has increased just 25% from $94 million in FY15, while Tech Mahindra's revenue has grown 73% from $6.4 billion over the same period.

Pininfarina, which follows a January-December financial calendar as against Tech Mahindra's April-March, ended 2025 with a net loss of €6.7 million ($7.6 million), down 63% on-year. This was its fourth loss in the last five years. Its revenue rose 13% on-year to $118 million.

“The performance in 2025 was driven primarily due to a market environment characterized by persistent uncertainty, weaker demand and increasing competitive pressure, which adversely affected margins and overall profitability,” said a Pininfarina spokesperson, adding that the company is confident of delivering on its growth targets.

Tech Mahindra does not break down revenue by engineering services. But Pininfarina falls under the company's manufacturing business, which makes up a fifth of its revenue.

The acquisition was meant to bolster the IT company's engineering and design capabilities, as chairman Anand Mahindra said at the time of the deal. Instead, the Italian firm has become a recurring capital commitment for the Mohit Joshi-led firm, which aims to script a turnaround.

Fading shine

Pininfarina's challenges are both old and new. Its troubles began as automakers started cutting spending on external design houses. “Automotive businesses continued paying great attention to cost management and operational efficiency, revising their strategic plans and focusing on innovative and diversified solutions to mitigate market volatility,” read Pininfarina’s FY25 annual report.

Industry executives also identify weak demand and slowing growth at European car brands such as Volkswagen, Renault, and Stellantis for the struggles of European design brands such as Pininfarina.

“The cost-cutting measures affect designing as companies have moved it internally to save costs and also have more control to save time. European carmakers are executing a lot of such measures to cut down costs," said Amit Kaushik, founder of auto tech consultancy Mobidx AI.

Kaushik added that another factor is that carmakers are moving beyond traditional designs to more radical new introductions as China has disrupted the market. For instance, Ferrari recently outsourced the design of its first EV, Luce, to former Apple designers Marc Newson and Sir Jonathan Paul Ives.

Last year compounded the designer's worries. Pininfarina's Italian business reported a €14 million loss, higher than the Pininfarina Group's €6.7 million loss because it wrote down the value of its investments in its Chinese and German subsidiaries.

The loss reduced its shareholders' equity to €29.6 million against a share capital of €56 million. Under Italian law, if a company loses more than a third of its share capital, the parent is expected to invest money to keep it running.

Consequently, the Dutch parent was forced to write off about €10 million of the €14 million it loaned to Pininfarina last December. This write-off equals half the loans, or about €20 million, that the car designer got last year from Tech Mahindra and Mahindra & Mahindra.

This further led Tech Mahindra to quadruple its guarantees to the company, reflecting the group's growing financial exposure.

TECHM

Ferrari's former design house is hanging by a thread—extended by Tech Mahindra

Wait for it…

Wait for it…