Automobilwoche states Recaro shutdown was due to Ineos

The automotive business magazin "Automobilwoche" states in an article from today that the shutdown of Ineos was in parallel to the insolvency of Recaro and not because. Insider said to Automobilwoche that in deed the lack of orders from Ineos lead to the shutdown of Recaro.

Quote: " “Of all the possible components, it was precisely a very important one,” commented Calder on the failure in the British newspaper “Daily Telegraph.” Ironically, the imbalance at Recaro is said to have been caused by a lack of quantities from the largest client, namely Ineos, according to sources within the company.

Recaro's bankruptcy has a significant impact. When asked why Ineos had not attempted to stabilize Recaro as a supplier with a financial injection, an Ineos spokesperson told Automobilwoche that they could not comment on individual business relationships, as it is a complex situation. The interruption in Hambach is expected to last for several months. “With cautious planning, a return to full production capacity is anticipated in spring 2025,” said the spokesperson. It remains unclear where Ineos will source the seats for the Grenadier, as Recaro is set to cease its production in Kirchheim/Teck by the end of the year. "

They also refer to a past interview from June 2024 with Lynn Calder where she stated a targeted unit numer of 30,000 and Automobilwoche also remembers Ineos statement that there has been 20 ,000 orders when the ramp up has started in 2023, but the first number hasn't been reached and even the latter number is missed, over two years, yet. They also refer to Marklines number of around 5,000 units for the USA and that is the best running market. They continue that the sales went down about 36% in Germany and one-third in Europe, compared to 2023.

In the last section they repeat what I stated here, also, that the image of the car has changed and that the marketing has to adopt that:

"Changed Marketing Strategy
Calder also had to adjust the marketing strategy to make the vehicle appealing to a broader customer base. Initially, the Grenadier was promoted for heavy-duty off-road use, targeting foresters, farmers, or NGOs operating in rugged terrain.

However, a marketing campaign during the European Football Championship emphasized the lifestyle aspect in order to expand the potential customer base. "From many conversations, I know that the off-road vehicle Grenadier, in connection with the name Ineos, is still not well known," said Calder."

Here is the link: https://www.automobilwoche.de/autohersteller/warum-ineos-automotive-gerade-probleme-hat
Payment required.

AWo

 

[ADVAW8S]

The automotive business magazin "Automobilwoche" states in an article from today that the shutdown of Ineos was in parallel to the insolvency of Recaro and not because. Insider said to Automobilwoche that in deed the lack of orders from Ineos lead to the shutdown of Recaro.

Quote: " “Of all the possible components, it was precisely a very important one,” commented Calder on the failure in the British newspaper “Daily Telegraph.” Ironically, the imbalance at Recaro is said to have been caused by a lack of quantities from the largest client, namely Ineos, according to sources within the company.

Recaro's bankruptcy has a significant impact. When asked why Ineos had not attempted to stabilize Recaro as a supplier with a financial injection, an Ineos spokesperson told Automobilwoche that they could not comment on individual business relationships, as it is a complex situation. The interruption in Hambach is expected to last for several months. “With cautious planning, a return to full production capacity is anticipated in spring 2025,” said the spokesperson. It remains unclear where Ineos will source the seats for the Grenadier, as Recaro is set to cease its production in Kirchheim/Teck by the end of the year. "

They also refer to a past interview from June 2024 with Lynn Calder where she stated a targeted unit numer of 30,000 and Automobilwoche also remembers Ineos statement that there has been 20 ,000 orders when the ramp up has started in 2023, but the first number hasn't been reached and even the latter number is missed, over two years, yet. They also refer to Marklines number of around 5,000 units for the USA and that is the best running market. They continue that the sales went down about 36% in Germany and one-third in Europe, compared to 2023.

In the last section they repeat what I stated here, also, that the image of the car has changed and that the marketing has to adopt that:

"Changed Marketing Strategy
Calder also had to adjust the marketing strategy to make the vehicle appealing to a broader customer base. Initially, the Grenadier was promoted for heavy-duty off-road use, targeting foresters, farmers, or NGOs operating in rugged terrain.

However, a marketing campaign during the European Football Championship emphasized the lifestyle aspect in order to expand the potential customer base. "From many conversations, I know that the off-road vehicle Grenadier, in connection with the name Ineos, is still not well known," said Calder."

Here is the link: https://www.automobilwoche.de/autohersteller/warum-ineos-automotive-gerade-probleme-hat
Payment required.

AWo

I used the paywall clear and pulled this translated quote.
The largest market is the USA
Things are going better for the Grenadier in the USA. The country has quickly become the largest market. Since entering the market last autumn, sales have settled at over 500 units per month, and this year it is already almost 5,000
Nevertheless, that is not enough to really utilize production in Hambach. While Lynn Calder had spoken of a possible 30,000 units for 2024 in an interview with Automobilwoche in June of this year, the figure is now expected to be 10,000 less.

 

[ADVAW8S]

This article leads me to believe that Lynn Calder will be doing some big retooling during the shutdown. I can see them move dealership models. I could even see IFS be added. You figure they already did majority of the work for Fussilier, it might be easy for them to implement in the 2026 model. Develop a campaign that drives attention and squash the negative feedback loop.

 

[Zimm]

The only “fact” I pulled from this, is “spring”. Thats March, April or May, and vague timelines tend to emphasize the optimistic.

On the other hand, if it isn’t all bullshit, this means we’re gonna get a better seat we can swap into the rig.

 

[Zimm]

. I could even see IFS be added.

Not a chance.

 

[DoubleDoom]

I still do not believe Ineos were the major supplier with Recaro. BMW, Ford and VW all had options in their range for Recaro seats. If Ineos was the biggest, then Recaro were doomed long before this point.

 

[CrazyOldMan]

The automotive business magazin "Automobilwoche" states in an article from today that the shutdown of Ineos was in parallel to the insolvency of Recaro and not because. Insider said to Automobilwoche that in deed the lack of orders from Ineos lead to the shutdown of Recaro.

Quote: " “Of all the possible components, it was precisely a very important one,” commented Calder on the failure in the British newspaper “Daily Telegraph.” Ironically, the imbalance at Recaro is said to have been caused by a lack of quantities from the largest client, namely Ineos, according to sources within the company.

Recaro's bankruptcy has a significant impact. When asked why Ineos had not attempted to stabilize Recaro as a supplier with a financial injection, an Ineos spokesperson told Automobilwoche that they could not comment on individual business relationships, as it is a complex situation. The interruption in Hambach is expected to last for several months. “With cautious planning, a return to full production capacity is anticipated in spring 2025,” said the spokesperson. It remains unclear where Ineos will source the seats for the Grenadier, as Recaro is set to cease its production in Kirchheim/Teck by the end of the year. "

They also refer to a past interview from June 2024 with Lynn Calder where she stated a targeted unit numer of 30,000 and Automobilwoche also remembers Ineos statement that there has been 20 ,000 orders when the ramp up has started in 2023, but the first number hasn't been reached and even the latter number is missed, over two years, yet. They also refer to Marklines number of around 5,000 units for the USA and that is the best running market. They continue that the sales went down about 36% in Germany and one-third in Europe, compared to 2023.

In the last section they repeat what I stated here, also, that the image of the car has changed and that the marketing has to adopt that:

"Changed Marketing Strategy
Calder also had to adjust the marketing strategy to make the vehicle appealing to a broader customer base. Initially, the Grenadier was promoted for heavy-duty off-road use, targeting foresters, farmers, or NGOs operating in rugged terrain.

However, a marketing campaign during the European Football Championship emphasized the lifestyle aspect in order to expand the potential customer base. "From many conversations, I know that the off-road vehicle Grenadier, in connection with the name Ineos, is still not well known," said Calder."

Here is the link: https://www.automobilwoche.de/autohersteller/warum-ineos-automotive-gerade-probleme-hat
Payment required.

AWo

I think I’m all good for now with Recaro’s whining. To suggest that Ineos order volume is the thing that put them in this situation is such a load of garbage. Recaro put themselves in this niche, they’ve lost all their customers, and they are trying to put on a good face to get/force a rescue. It’s a classic bankruptcy dance. Ineos shouldn’t try to rescue them if they can get out with a spec and an alternative fabricator. It’s not a rosy picture for German automotive suppliers who don’t have a defensible unique space. I would not want to be left holding that bag if I were Ineos.

 

[AWo]

It is documented that Recaro was struggling for about two years.

That, again, leads to the question why Ineos went with such a candidate for such an essential part? I did a project for Ineos about 10 years ago, a mid-size 6-digit budget and all suppliers had to pass a solvency check... The misery of Recaro was foreseeable and known within the industry. All other car manufacturers used Recaro only as an option, so they do not get into trouble if they die and can easy replace seats (just not offering Recaro anymore). Not so Ineos.

Two years of time wasted to find an alternative supplier...if it wasn't Ineos which caused the insolvency.

However, I believe that missing Ineos orders were the death blow for Recaro. And missing orders are due to ow sales numbers and means low earnings and that means more problems.

AWo

 

[Zimm]

Volume pricing requires the volume. I’m not so sure what’s so hard to comprehend. If you’re running a lab and the instrument you just bought from Leica has a reagent deal for 100000 tests a year for 5 years, and you only run 40000, Leica is losing money on you and burning it down. If you’re were their only customer, they burn down. That’s how it works.

Now, why Ineos would make this deal is a mystery we will never know for certain, but, I’m guessing it has to with money. Maybe Recaro went from the premium seat to the only seat by circumstance rod Ineos trying to cut supply costs and it but them in the ass when sales targets could not reach the break even point. Maybe the original Ineos deal was the “save Recaro” deal in the first place, and it failed.