Brexiteer Ratcliffe’s Ineos drops Wales for France to build new car

FILE PHOTO: Ratcliffe, CEO of British petrochemicals company INEOS, poses for a portrait with the Canary Wharf financial district seen behind, ahead of a news conference announcing the launch of a British America's Cup sailing team in London, Britain

By Costas Pitas

LONDON (Reuters) – Billionaire Jim Ratcliffe’s Ineos will manufacture its first car in France after a deal to take over a site run by Germany’s Daimler, ditching plans to build a factory in Britain as COVID-19 disrupts the automotive industry.

Prominent Brexit supporter Ratcliffe’s petrochemicals company said in September 2019 it would build the Grenadier off-roader in Wales, creating up to 500 jobs, with a new plant in Portugal supplying the body and chassis.

But in July it announced it was reviewing the investments due to the pandemic presenting “opportunities in terms of existing manufacturing capacity that were not previously available to us.”

On Tuesday, Ineos confirmed it would take over Hambach, a Daimler facility close to the border with Germany.

“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,” Ratcliffe, who is Ineos group chairman, said in a statement.

The global car sector has been shedding jobs, reviewing decisions and cutting costs as COVID-19 hits demand.

The Grenadier will enter production late next year and as part of the deal, Ineos will also continue to make the smart EQ fortwo vehicle and some Mercedes-Benz components totalling roughly 1,300 jobs at the site in France.

The company said it was won over by the location due to its proximity to the border with Germany, giving access to supply chains and target markets among other factors.

The original investment decision from prominent Brexit supporter Ratcliffe was a major boost to the British car sector which has been hit by uncertainty since 2016 as to the terms of its trading relationship with its biggest export market, the EU.

The planned location in Wales was close to a Ford engine plant which shut earlier this year, with the loss of some 1,700 jobs.

(Reporting by Costas Pitas, editing by Sarah Young, Elizabeth Piper and John Stonestreet)