Billionaire Ineos oil boss Jim Ratcliffe has today driven his chunky new Grenadier 4X4 on its public debut in Britain – and revealed it will ‘almost certainly’ not be built in the UK.
In an exclusive interview with This is Money and the Mail Online, he said an agreement to make the Land Rover Defender rival at a former Daimler-owned factory in Hambach on the border of France and Germany is ‘pretty much’ decided, dealing a huge blow to Bridgend in Wales where the utilitarian car was originally pegged for production.
Mr Ratcliffe – Britain’s fifth richest man – took to the wheel of an early prototype of the off-roader at the Concourse of Elegance at Hampton Court Palace, London, where he admitted to us it was the first time he had seen the vehicle in the metal.
‘Almost certainly’ not being built in the UK: Sir Jim Ratcliffe (right) has all but confirmed his new Ineos Grenadier 4X4 will be produced in France and not Wales, as originally intended
The Grenadier 4X4 made its UK debut at the Concourse of Elegance at Hampton Court Palace today. Ratcliffe admitted it was also the first time he’s seen the vehicle in the metal
Delighted by the reaction of the guests to his bruising 4X4, Ratcliffe said: ‘It’s brilliant. It’s the first time I’ve seen it. I’ve only seen it in clay model form up to now. It’s very exciting.’
Asked to describe the vehicle and its performance, he added: ‘It will end up 80 per cent Mercedes-Benz G-Wagon, but at half the price.’
Mr Ratcliffe, who is reportedly worth £12.15billion, according to Time Times’ 2020 Rich List, gave some additional insight into the development going into the 4X4, which was due to be produced in South Wales and create 500 new jobs for the UK motor industry.
‘We’ve got 200 German engineers down near Stuttgart working on it,’ the petrochemicals mogul explained.
‘The engine is amazing. And it’s great engineering. The doors close with a real clunk.’
When asked directly if the decision had been made to go for it, he admitted; ‘Pretty much.’
Ratcliffe arrived and left for his Grenadier drive at Hampton Court by helicopter.
The 4X4 is a direct rival to the Land Rover Defender, but today Ratcliffe compared it to the Mercedes-Benz G-Wagon
‘The engine is amazing. And it’s great engineering. The doors close with a real clunk,’ Ratcliffe told This is Money
His words today will be a bitter pill for Bridgend.
Ratcliffe had said last summer that the the 4X4 would come with a ‘Made in Britain stamp’ as it would be produced at a new ‘state-of-the-art’ factory in South Wales.
Not only that, Inoes Automotive even unveiled computer-generated images of how the plant could look at the site close to the Ford engine factory, which is due to close this month.
However, the availability of a ready-made production facility in Hambach – close to the German border and near the German city of Saarbrucken in industrial Saar region – has resulted in plans to build in the UK being put on hold.
How does the Ineos Grenadier compare to the new Land Rover Defender? Here’s a head-to-head
Proposed UK automotive jobs could be scrapped: Ineos Automotive had previously said it will build its new Grenadier 4X4 at a new ‘state-of-the-art’ facility in Bridgend, Wales
The South Wales plant would have created 200 new jobs initially, expanding to 500 once production ramps up. Ford’s due-to-close engine plant is the building you can see in the top left of this image
In a statement released in July, Ineos Automotive chief executive, Dirk Heilmann, said: ‘Overcapacity has long been a major issue for the automotive sector.
‘Of course we considered this route previously, but as a result of the Covid-19 pandemic some new options such as this one with the plant in Hambach have opened up that were simply not available to us previously.
‘We are therefore having another look – and reviewing whether the addition of two new manufacturing facilities is the right thing to do in the current environment.’
The Grenadier offroader was only unveiled in full in July, revealing a shape very similar to that of the previous-generation Land Rover Defender
Petrochemicals firm Ineos, which is owned by the pro-Brexit billionaire Sir Jim Ratcliffe (pictured) – named the fifth richest man in Britain by the Sunday Times this year – said last autumn that it would make the vehicle in Wales
Grenadier is designed to be s a hard-working, utilitarian 4X4 in the same ilk as the original Land Rover Series and aimed at farmers and off-road enthusiasts
He added: ‘Covid has had an impact on our build schedules with ground clearing works and construction held up by the social distancing measures that have been required.
‘Safety is of course paramount, but we also have an obligation to do what is right for the business – and so need to assess these new opportunities in order to maintain or improve on our timelines.’
Ineos Automotive chief executive, Dirk Heilmann
Ineos said it would be reviewing its options in the next few weeks, though Sir Jim Ratcliffe’s comments suggest the deal is almost done.
Bosses had estimated that Ineos Automotive would build up to 25,000 4X4s a year, which would have created 200 jobs in Wales initially, rising to 500 in the longer term.
Around 100 staff are already with its engineering partner MBTech at its centre near Stuttgart in Germany – just 140 miles from Daimler’s Hambach factory in eastern France.
The engines used in Grenadier will be six-cylinder petrol and diesel BMW powerplants, which would also be easier and cost-effective to transport to a production facility on the French border rather than incurring import tariffs to ship to Wales post-Brexit.
A sub assembly plant in Estarreja, Portugal, had also originally been planned to produce chassis and body components.
It was said to also create up to 500 more jobs n the longer term, but is now also at risk.
German carmaker Daimler has put up for sale its Hambach factory in France (pictured), near Metz and Saarbrücken, as it tries to cut costs
The German site is currently the home of the Smart EQ ForTwo models – the compact electric-powered city cars
Ineos said it has suspended the post-lockdown resumption of work at sites in Wales and Portugal pending a decision to take over the Hambach plant being sold by Daimler (pictured)
Speaking to This is Money, Ineos Automotive commercial director, Mark Tennant, said earlier this year: ‘Grenadier is absolutely going ahead. This is a re-affirmation of it going ahead. We are looking at something that was not previously available. It’s not something we are taking lightly.’
The fall-out from the coronavirus has been a factor for the consideration to switch to the factory in mainland Europe, but Brexit had not, he insisted – despite some industry skeptics seeing it as convenient cover for a hard-nosed financial move.
Mr Tennant claimed the opportunity of a ready-made site provided by Hambach was the driving factor, not Britain’s decision to leave the EU.
‘Brexit was not an issue,’ he said. ‘Brexit has not played a role.
‘We are looking to mitigate risk around timescale. There’s a lot up in the air about a second wave of Covid.’
Ineos owner, Ratcliffe, 67, has been a vocal supporter of Brexit, saying Britain would thrive outside of the EU.
In an interview with The Sunday Time in 2018 – shortly after he was knighted – he said: ‘The Brits are perfectly capable of managing the Brits and don’t need Brussels telling them how to manage things.
‘I just don’t believe in the concept of a United States of Europe. It’s not viable.’
However, today’s announcement could result in a public backlash against the petrochemicals mogul, similar to the one aimed at Britain’s richest man, Sir James Dyson, when he announced his intention to move production of his ill-fated electric car from the UK to Singapore, despite intensely backing the Brexit decision.
The electric SUV project was eventually shelved late last year after the entrepreneur said it was ‘not commercially viable’.
Sir James Dyson, Britain’s richest man, was heavily criticised when he announced plans to shift production of the brand’s electric car from the UK to Singapore in 2018, despite strongly backing the Brexit campaign. The zero-emission SUV project was eventually axed last year
The Hambach plant has been recently developed with a new dedicated SUV line, similar in size to the Grenadier
Ineos bosses said the adaptations already made to the production facility would be ‘ideally suited’ to build the new Grenadier 4X4
Mr Tennant said; ‘The Grenadier has got to be a strong commercial proposition. We have to look at existing capacity. We’re still in negotiations.’
If the Hambach option is concluded, production in South Wales and Portugal will not go ahead, he confirmed. ‘It’s a binary decision,’ he explained,
Mark Tennant, Ineos Automotive commercial director
It was ‘too early’ to talk about any compensation or otherwise to the Welsh authorities who were developing the wider site for businesses, he added back in July.
Mr Tenant said he was confident that, despite the delays caused by coronavirus, production at the end of 2021 and first sales in 2022 would remain on schedule.
‘Our aspiration is still to start production at the end of 2021 and have the Grenadier on sale early 2022,’ he told us.
The coronavirus pandemic has seen demand for new vehicles around the world slump and worsened problems affecting overcapacity, just as the sector pumps billions into electrifying its model line-ups to meet stringent emissions rules.
German carmaker Daimler has made the French factory available as part of extended efforts to cut costs.
The site, which is the home of the smart EQ fortwo models, has been recently developed with a new dedicated SUV line, similar in size to the Grenadier.
Ineos bosses said this would be ‘ideally suited’ to the production of the 4X4, which is seen as the spiritual successor to the Land Rover Defender.
From launch, the Grenadier will be powered by 3.0-litre BMW petrol and diesel engines, though there’s an electric hydrogen-powered version to follow
Ineos Automotive will launch two variants of their own off-roader – a classic 4X4 design (left) plus a double-cab pick-up (right) with an open load-lugging platform at the back
Ineos bosses insisted they were not trying to exploit a grants merry-go-round by playing off one country against another, as other manufacturers have appeared to do in the past, but were looking to switch for purely commercial reasons.
‘Grants are not the main issue. We are not playing games in terms of who can give us most support,’ Tennant explained.
‘Hambach has given us more options to minimise delays caused by Covid.
‘The main factor for Hambach is the opportunity to switch from a green field site to an existing factory with a trained workforce.’
He accepted that the prospect of a trained workforce at Bridgend in South Wales had been a big draw initially.
He said Inoes had also looked at Hambach in the past, but ruled it out because at the time it did not have the capability to build 4X4s, Now it does, following a big investment in 2018.