Ineos forced to shut down production on supplier issue

Media starting to break that production of the IG is going to be paused until 2025 due to financial troubles at one of its suppliers.

The UK dealers were just told and mine told me today but I didn't post anything until I saw it starting to appear in the media. I cant see behind the paywall but I wonder if this is recaro?

 

[DaveB]

I don’t buy the 20,000 number either. They only made 4553 in 2023. 2022 was a very low production year. I seriously doubt they pumped out 15000 (tripled production) in 2024. Guessing - and just a guess - there are 12000-ish world-wide right now. - Mark

At the end of 2023 there were 900 in Australia or on the way here.
I doubt we were 25% of their orders or production.
Could have been I guess but I doubt it.

 

[DaveB]

My VIN is 21528 and I picked it up 14 days ago. So using the logic that some here have offered, I’m guessing you picked yours up from the dealership 12 minutes ago and they made nearly 1100 cars in the past 11 work days. Unlikely - right? Right. This is why I doubt the 20,000 car figure.

I don't think they put the vins on after they arrive at the dealer so your vin could have gone on the vehicle 6 months ago.
They could have shipped another 1,000 vehicles to customers in europe since they made yours
Considering we have received a fair few Quartermasters here in Australia that also has to add to the total

 

[DaveB]

Interesting statement, who or what is the source for this statement? Perhaps to be posted in the Chuckle of the Day" thread?

Most reliability reports think Landrover is the least reliable brand or close to it.

https://www.motortrend.com/reviews/2021-land-rover-defender-110-yearlong-review-update-6-reliable/

 

[DaveB]

If a large manufacturer like vw, gm, ford, toyota builds this exact truck, its 65g and all the little issues are gone. we already paid the extra 20 for the small volume manufacturer cool tax. Another 30 and this thing is DOA. I think they would have been better off lowering the price to hit higher volume targets, but it's tough not to get caught up in your own hype.

I am pretty sure none of those manufacturers would build this exact truck as it is way to niche and low volume.
If they could sell it for $65K in large volumes at a profit then one of them would be building it.

 

[DaveB]

According to Automotive News - this is Recaro of Germany automotive seats business - the only production series they supply is Grenadier. The rest are aftermarket which is a shrinking market. Perhaps Volvo use another Recaro division . Recaro also make aviation seats that are not connected to the insolvency so it’s not as simple. I guess it’s specifically relating to a loss making German Recaro factory.

The Porsche Audi and VW business has stopped as the vehicles they were used in are discontinued models.
The Ford and Chevrolet was moved to the US manufacturing plant
Chinese business is sold out of Japan I believe.
it looks to me like the US owner has done this on purpose as I am sure the German plant is very expensive. Or they are just really bad managers.

 

[ADVAW8S]

Totally done on purpose. US owner probably got better conditions

 

[Shopkeep]

Why you say that?

Just the vibe I get, but not suggesting they are less than fully committed now they are balls deep in. Starting a car company from scratch is like starting a new airline, it seemed like a good idea at the time.....

 

[ADVAW8S]

Just the vibe I get, but not suggesting they are less than fully committed now they are balls deep in. Starting a car company from scratch is like starting a new airline, it seemed like a good idea at the time.....

He did mentioned that he spent way more to get it started than he thought he would.

 

[ethree]

I think INEOS is handling this issue as best they can.

As to the official statement and not naming the supplier, this is normal. The last thing they want to do is further embarrass a working partner. Word will get out—and it has but without INEOS throwing them under the bus. That’s called good leadership.

As to the shut down, no seats = no production and since the seats are a safety component that include airbags, it’s not a plug and play affair by just going to seat “X”. I’m willing to venture a logical guess that they are trying to resolve this with Recaro while looking at an alternative they can get safety tested and government approved. No small hurdle. One that’s gonna set them back a few months in either solution case.

When I went to Curry (Danbury, CT), I saw a lot of traded in Defenders and Jeeps. Guess what they were buying? Grenadiers. I made the comment that Curry had a great used Defender lot. Saw a bunch, along with plenty of Grenadiers for sale.

Much to the chagrin of some (hopefully not in here), INEOS isn’t going anywhere. We are lucky to have the backing of INEOS proper and the fact we are part of a small manufacturing footprint when compared to the giants. The giants, like VW, are the one’s struggling—Bad. Something to be said for the nimbleness of a small manufacturing footprint. INEOS is probably in the best position to weather this storm.

Consider a possible silver lining: if they do change seats—maybe lumbar support will be added.

In any case, I’ll be glad I have my Recaros.

 

[RYAustralia]

The issue may also be that if using an alternative seat supplier that Ineos would have to re-do all the testing /safety and engineering approvals etc for all the markets they sell in.

I’m guessing Ineos would rather wait it out with recaro to sort out their debt restructure and to recommence with recaro, than have the massive hassle and cost of switching suppliers.

 

[Shopkeep]

The issue may also be that if using an alternative seat supplier that Ineos would have to re-do all the testing /safety and engineering approvals etc for all the markets they sell in.

I’m guessing Ineos would rather wait it out with recaro to sort out their debt restructure and to recommence with recaro, than have the massive hassle and cost of switching suppliers.

Recaro is the only car seat brand the average person recognises (unless you are a motorsport tragic or hard core car nut). Ineos needs to offset their lack of brand equity by leveraging reputable brands people are familiar with (Recaro, Brembo, BMW, ZF, Eaton etc).

 

[Karearea]

With due respect, your suspicion isn't correct.
I have a VIN 1312. Each time I am at my dealer, I look at the VINs of the new cars. It steadily goes up. Last time I saw new Grenadiers and Quartermasters with VINs above 14000.

My vin is 193
Anyone care to beat that on the downside?

 

[AWo]

You are correct that their profit is down, however they are still making a fairly healthy profit.

View attachment 7870733

I see "Indebtedness" is ten times the EBITDA (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation). Subtract the 972 Million, so the revenue is 713 Million. The relationship between the EBITDA, the deprecation, amortization and impairment and the indebtedness got worse from 2021 to 2023. A very important figure is the net debt, and that has increased, what is not good. That is what I read from that table.

Do not forget the Ineos is splittet into business units, usually between 15 and 18, depends on time and acquisition and sales. There are fortune BU's and not so fortune BU's. Automotive is also one BU. Money one BU has and earns is not automatically available for other BU's. Money earned by a BU in the US is not money this BU can spend in Europe. A BU may own more than one site, sites are like competitors. However, BUs also support their fellow BUs in other countries. If, for example the OPN BU in Norway makes profit, it can help other OPN BUs somewhere else.

The European chemical business is still under heavy financial pressure, the slight increase in business during early summer is gone already (the reason for that is the situation in the Red Sea which lead customers to buy where the logistic is not harmed and European producers are in advantage here). Taking money from chemical BUs for other adventures would be suicide, it is simply not possible. Except the decision is made, to sell sites or BU's to others...but who will pay for European chemical sites at that time? There's a reason why Ineos started a joint venture with SINOPEC in China again for the same products produced in Europe. It seems that they move away production capabilities to countries where it is cheaper to run the sites. However, this joint venture will cost 5$ billion on the Ineos side...

Fun fact: They signed that joint venture with SINOPEC, a company they fought in front a court ten years ago already, when they started their first joint venture with them...they seem to be real friends...

INEOS and SINOPEC complete major petrochemicals deal in China.

INEOS has today completed the formation of a 50/50 joint venture with SINOPEC for the Tianjin Nangang Ethylene Project.

www.ineos.com

INEOS announces legal action against Sinopec and Sinopec subsidiaries

Jim Ratcliffe, Chairman, says “ we want to take our best technology to China but we need to know that it will be protected .” INEOS, one of the world’s largest chemical companies, takes legal action in China against a number of Sinopec subsidiaries for misuse of trade secrets in its Acrylonitril

www.ineos.com

AWo

 

[AWo]

Regarding this German Newspaper article Recaro will continue to produce seats despite their situation and fulfill all contracts....

Auto-Zulieferer Recaro ist insolvent: "Fühlen uns vom Management im Stich gelassen"

Die Autosparte des Sitzhersteller Recaro hat Insolvenz angemeldet. Im Betriebsrat fühlt man sich vom Management im Stich gelassen.

www.augsburger-allgemeine.de

In English: https://www-augsburger--allgemeine-..._sl=de&_x_tr_tl=en&_x_tr_hl=de&_x_tr_pto=wapp

"The dpa report also states that despite the insolvency, production will continue at full capacity in order to fulfill existing and new orders. The approximately 200 employees will also receive insolvency benefits for three months. According to the official portal for insolvency announcements , Stuttgart lawyer Holger Blümle has been appointed as provisional administrator, who will examine the company's financial situation and monitor management."

dpa is the German press agency.



AWo

 

[Tazzieman]

I really think the pessimists should sell sell sell so the optimists can buy buy buy.

 

[AWo]

"pessimist" is a term optimists created for realists.

AWo

 

[G-Man]

"pessimist" is a term optimists created for realists.

AWo

'Optimist' is a term pessimists created for Early Adopters

 

[Tazzieman]

'Optomist' is a term pessimists created for Early Adopters

I love being an early adopter. No issues whatsoever, and I paid the right amount What a vehicle , and what a bargain!

 

[G-Man]

As most of this thread is pure speculation I'll add to the hubbub by predicting that every stock vehicle with a Rough Pack, Smooth Pack and tow bar will now sell out quickly regardless of paint colour or funky configuration

 

[JonSutton]

At the end of 2023 there were 900 in Australia or on the way here.
I doubt we were 25% of their orders or production.
Could have been I guess but I doubt it.

Tend to agree. My chassis number is mid 4000’s and was built June 23. Gut feel is that 20k won’t be too far wrong unless Ineos are not building sequentially numbered vehicles.