THE INEOS Grenadier 4×4 is to be built in France after its manufacturer said it had reached a deal with Mercedes-Benz to use its Hambach facility.
The announcement confirms reports from this summer that Ineos was in talks with Mercedes to purchase the site, which is located on the French-German border. The final deal will see Ineos produce Mercedes’ Smart EQ fortwo electric city car alongside the Grenadier on a contract manufacturing basis, which the company says secures the future of the site and safeguards 1,300 jobs in the region.
However, the move is seen as a snub to Wales after Ineos founder Sir Jim Ratcliffe, a prominent Brexiteer, had said the Grenadier would be assembled at a new factory in Bridgend, close to the old Ford plant, creating 200 jobs and up to 500 in the long term. A second factory in Portugal was to build the Grenadier’s chassis.
Moving production to Hambach means the entire process can be completed in one facility.
Hambach is a state-of-the-art facility with a highly skilled workforce and is well located for access to markets, suppliers, and #automotive talent.
— INEOS (@INEOS) December 8, 2020
In a statement, Ineos said: “Hambach is the ideal facility for production of the Grenadier. One of Europe’s most modern automotive manufacturing sites, it is home to a highly experienced and capable workforce, has an excellent track record amongst Mercedes plants for the quality of its output, and recently benefited from a major investment to enable the production of larger vehicles.
“Additionally the site’s location on the French-German border, only 200km from Stuttgart, gives excellent access to supply chains, automotive talent and target markets.”
Production in the European Union means Ineos will avoid 10% export tariffs when shipping vehicles to buyers on the continent, which will be added to any cars built in the UK in the event of a no-deal Brexit and defaulting to World Trade Organisation terms. The company will also avoid the same tariff on imports of components from Europe.
Car makers have warned that the “catastrophic” cost of Britain leaving the EU without a trade deal could amount to as much as €110bn (£101bn) over the next five years, adding to existing woes. The British motor industry lost more than 20,000 jobs in the two years before the Covid-19 pandemic, including the closure of the Honda car plant in Swindon and the Ford engine factory in Bridgend.
It is thought the Vauxhall car plant at Ellesmere Port in Cheshire could also be closed.
Although Nissan has said it will not be cutting jobs at its factory in Sunderland, the biggest car manufacturing plant in the UK, boss Ashwani Gupta warned that a no-deal Brexit would make the car maker’s operations in the UK “unsustainable”.
Mini, which has a plant in Oxford, told Driving.co.uk that it was committed to its UK facility until 2023 or 2024, when the current Mini is replaced, as the brand is committed to its British heritage, but could not comment on plans beyond that. Head of Mini Bernd Körber said that “everything would be a lot easier if there would be at least a free trade agreement.”
Sir Jim, 68, is one of a number of prominent business owners who supported Brexit, along with Sir James Dyson, the vacuum cleaner tycoon who last year brought down the shutters on his own car business, and Lord Bamford, the owner of JCB. Sir Jim has said he supports “a common market but not a united states of Europe”.
He made his fortune in the petrochemical business and is described by The Times as “a Monaco-based tax exile who is reckoned to be worth £17 billion”. He decided to create the Grenadier, which is strikingly similar in appearance to his beloved classic Land Rover Defender, after Jaguar Land Rover ended production of the car in January 2016.
Jaguar Land Rover has since gone into production of a new generation Defender, much more like its stable of other luxury sports utility vehicles, in Slovakia.
Sir Jim said: “Hambach presented us with a unique opportunity that we simply could not ignore: to buy a modern automotive manufacturing facility with a world-class workforce. Ineos Automotive set out a vision to build the world’s best utilitarian 4×4, and at our new home in Hambach, we will do just that.”
Chris Elmore, Labour MP for the Ogmore constituency in Bridgend, called the decision a “hammer blow”.
“That Brexit is clearly a major factor at play is a bitter pill to swallow,” he wrote on Twitter. “Ineos owner Sir Jim Ratcliffe was a vocal Brexiteer, loudly proclaiming the benefits of leaving the EU. Today, we can see his claims are as hollow as his promises.”
That Brexit is clearly a major factor at play is a bitter pill to swallow. Ineos owner Sir Jim Ratcliffe was a vocal Brexiteer, loudly proclaiming the benefits of leaving the EU. Today, we can see his claims are as hollow as his promises. 2/2
— Chris Elmore MP (@CPJElmore) December 8, 2020
Ineos recently signed a deal with Hyundai to work on speeding up the global transition to a hydrogen economy, including work on a hydrogen-powered Grenadier.