Americas The big May 17 Announcement / Pricing / Discussion thread.

[40man]

I am out for now and let me explain why:-
The Grenadier was conceived as a tough off road utility vehicle for the working man, not a fancy Mall crawler. The fact is that it is not well equipped enough and doesn't have the brand recognition of Mercedes or Land Rover to be a mall crawler means it sits in the middle. It is too expensive for the Jeep/Bronco user and too cheap without the build quality and residual history of a G Wagon or a Land Cruiser/Lexus. It will probably end up like a Range Rover with atrocious depreciation. Lexus and Toyota hold their value because they have had decades of good reliability and proven offroad chops.
Anybody serious about off-roading knows that rock rails, lockers and winches are absolutely mandatory. These accessory prices are insane. You aren't going to tackle much at Moab or any other national park without them.
I want to wait and see how the third-party accessory market embraces this vehicle because except on the margin there is simply not enough demand to support a robust aftermarket. Just look at the Land Cruiser/Lexus market very few options with a vehicle that has a much bigger customer base.
The dealer network in the US is so subpar and undefined that I might find myself 300 plus miles from a dealer. My nearest Land Rover/ Jeep/ Mercedes dealer is 8 miles away. Customers simply aren't going to drive that far. This looks like the Alfa Romeo relaunch in the US, not enough dealers, sketchy out the door reliability and atrocious depreciation.
I think INEOS don't understand the US market, It will make or break the Grenadier it creates volume (unless they can crack China who are not big off road vehicle buyers). To get the factory to a margin level 25,000 units a year is a minimum, so it must be successful in the US. It is the largest off-road vehicle market in the world by far. The sheer size of the US aftermarket for Jeep parts proves that. There are hundreds of companies producing all sorts of gear because the market is huge. The Bronco is growing it further, along with the Colorado, New Tacoma, Ranger who all are very capable off-road vehicles and have at least some aftermarket support.
I want to see if Sales really do support the value proposition. To achieve the sales levels INEOS needs the UK, SA, Australia and other markets simply cannot generate enough sales. Holden folded in Australia because they couldn't make money in a market where in their best years, they only sold 100k units. The UK new car market is Australia around 1m units, SA is 500k, The UK is 2.3m in a good year. The USA is around 16m (pre covid) this is why prices are lower it is where the sales are. The G wagon in its best year sold 15k units globally and 8.5k in the US. Half of global sales!!! Land Rover sells 90,000 units in the US (30% of its production) with the Defender being the best seller by far.
I am concerned about depreciation. If it is the same as Land Rover then waiting is the prudent move.
There will always be people who will buy the latest cool toy. It is a very small market. Not enough to sell 10,000 units in the US, EVERY YEAR, which INEOS must do. If the Grenadier was $10k - $15k less then I would probably be in but at mid $90k including taxes for a well-equipped but spartan in comparison a Lexus, Range Rover or Mercedes vehicle, it is going to have a very small market. If they have soft sales, they will have to cut prices to drive efficiency in the plant.
I am willing to make the bet that INEOS have their pricing wrong, and that pricing will soften. It will for all manufacturers as inflation and supply chain shortages disappear. We are already seeing it starting to happen in the US. You can only throttle back production so much unless you can keep raising prices. It worked for a while, but I think that ship has sailed. Every Auto manufacturer is at their peak margin position right now as they all priced much higher than their cost increases because they could. Keynes was not wrong......
I love the vehicle; I love the concept, but it simply isn't THAT much better than other options to justify the price right now. I have the means to buy it but not the desire.

They can only sell 4,999 per year in the U.S. due to CAFE regulations. If they didn't have that restriction, I bet prices in the U.S. would have been lower to try and sell more. As it stands, the U.S. will be a small portion of total sales, and they'll likely have no problem getting to 4,999 sales per at current pricing.

With so few, it will likely be hard to expand the sales and service network.

 

[ChasingOurTrunks]

Is this because it's built in France? The Grenadier is probably the only car build in France that you can buy in the US. For a good reason. Maybe if they decided to build it in Eastern Europe like the big boys are doing, they could have kept the prices down.

I am not so sure it would result in savings - the plant they ended up with was turn-key and ready to go; to develop that from scratch would have a huge price tag that, certainly in these early days, would eat into the advantages of the lower labour costs in Eastern Europe. I don't know the exact numbers but they bailed on the UK because of the availability of the Hambach plant and workforce, which was a huge risk/hit to their intention of "great British icon reborn" and cost them a lot of goodwill with buyers early on, but also resulted in a time-to-delivery that was much faster than it otherwise would have been and I think ended up being worth it in the end.

I am out for now and let me explain why:-

I won't quote the whole post but I mostly agree with your reasoning, @Limeyjeeper. The main thing I disagree with you on is the importance of the US market.

Ineos only needs to sell 30,000 units per year to have a viable business. That's not that many, and in terms of sales numbers it's not even close to the volume of Jeep, Land Rover, etc. and I don't know if those numbers are fair comparisons - they do rely on the US market for sure, but with a need to only sell 30k units worldwide, Ineos is in a different boat.

In 2021, Toyota sold 13,900 70-series Land Cruisers just in Australia. And that's a car that came out in 1984. They actually stopped taking more orders, and the wait time is 4 years. I wasn't able to find info for the rest of the world, but they sell like hotcakes in the middle east, Africa, and South America too. And again - 1984 design.

Couple that with the progress of health and safety regulations in developed nations like Australia, and all of a sudden fleet buyers - who right now buy a TON of 70-series - might start saying "Hmm...1984 design vs 2023 CAD design that would include digital crash simulations, modern tech like crumple zones and some airbags, etc." -- when corporate health and safety obligations come into it, the modern design is likely to curry a lot of favour and rob sales of the 70 series.

So, I think the fleet sales will be huge for this thing -- but, another bit of evidence is that Ineos has said they cannot accept fleet orders right now. There's too much demand from consumers like us -- and that was months ago, before the US pricing; that could mean Ineos assumed a bunch of sales in NA, but they're on record as expecting 50% reservation cancellations so even there, they had conservative expectations of US sales already. It could also mean that just from Europe, AUS, and South Africa - where they've already launched - the volume is enough where they have to tell fleet customers - "Sorry, you'll have to wait".

I don't think they will have trouble hitting 30k units per year. I think they'll have trouble like Toyota - they'll have a waitlist a mile long and it'll take years to get a Gren in the driveway if one doesn't hold their reservation now (though they'd be well within their rights to not do so, for all the reasons you mentioned).

 

[ChasingOurTrunks]

They can only sell 4,999 per year in the U.S. due to CAFE regulations. If they didn't have that restriction, I bet prices in the U.S. would have been lower to try and sell more. As it stands, the U.S. will be a small portion of total sales, and they'll likely have no problem getting to 4,999 sales per at current pricing.

With so few, it will likely be hard to expand the sales and service network.

I didn't know that - this makes the pricing make more sense, actually. It's a lot cheaper to do the testing, importing, etc. if you have the chance of selling 10k or 15k units vs being limited to a ceiling of under 5k. That's a finite profit margin, and the books have to balance. With that number, I wonder if Ineos is even making money of the NA sales after all the people in the way between Europe and NA take their cut.

 

[BroncoBilly]

They can only sell 4,999 per year in the U.S. due to CAFE regulations. If they didn't have that restriction, I bet prices in the U.S. would have been lower to try and sell more. As it stands, the U.S. will be a small portion of total sales, and they'll likely have no problem getting to 4,999 sales per at current pricing.

With so few, it will likely be hard to expand the sales and service network.

at the prototype viewing GC told me the NA target for first year was 10k with 1200 of that for Canada.

 

[ChasingOurTrunks]

at the prototype viewing GC told me the NA target for first year was 10k with 1200 of that for Canada.

That's $163,200,000.00 in revenue in Canada at the price of my "ideal spec" which I admit has lots of boxes checked but not all of them. $163 million dollars.

That is 5% of the total GDP for the city of Toronto, where about 8% of Canadians live.

Ambitious.

 

[40man]

at the prototype viewing GC told me the NA target for first year was 10k with 1200 of that for Canada.

Right. Release in November 2023, get close to 4,999 through December, and 4,999 through the next year. They are calendar year #s.

 

[40man]

at the prototype viewing GC told me the NA target for first year was 10k with 1200 of that for Canada.

And to clarify, I received all of that info from the Ineos reps at the Seattle area test drive a little over a week ago. They said with the # restrictions, they'd have plenty available if all reservation holdera stayed on, but they were expecting a large drop (30% IIRC).

 

[BroncoBilly]

That's $163,200,000.00 in revenue in Canada at the price of my "ideal spec" which I admit has lots of boxes checked but not all of them. $163 million dollars.

That is 5% of the total GDP for the city of Toronto, where about 8% of Canadians live.

Ambitious.

my reply to him was "if you come in at around 85k you'll do that" foolish, foolish me but in my defence when I said that inflation was only transitory.

 

[painter]

I always go devils advocate on all decisions. Your emotions control so much of the buying decision. If you force yourself or someone to play the otherside a better picture emerges.

Point understood.

Doing the guy a favour (or doing the church's work, to continue the devil analogy). But to write, you'll regret it (do as I do or you'll go to blazes) is too much, imo.

My perspective, these folks will have already had their long walk in the snow. They've spent a lot of time on this, some a lot of time on here. Rather than just walk and go silent, this is their goodbye. Let them say their piece, have their closure.

If they respond back to the advocating member some of that will simply be out of politeness (I know for sure in one case)

If you can't afford it, you can't afford it. Maybe for 15% less you could have. Unfortunate.

If someone decides not to buy it, doesn't want to buy it, so be it. Some are disappointed. Some really want one, hoped they could but cant swing it. Had big plans.

No need to add salt in the wound.

It's bad form.

- My opinion, others will feel differently, that's ok with me. -

 

[Norb-TX]

Toyota discontinued the Land Cruiser because not many people were buying a bare bones off roader for $80K+ in the US.

Although I did.

 

[Limeyjeeper]

They can only sell 4,999 per year in the U.S. due to CAFE regulations. If they didn't have that restriction, I bet prices in the U.S. would have been lower to try and sell more. As it stands, the U.S. will be a small portion of total sales, and they'll likely have no problem getting to 4,999 sales per at current pricing.

With so few, it will likely be hard to expand the sales and service network.

Not true. CAFE doesn't limit vehicle sales they just fine the manufacturer based on this equation. "The fine is calculated at $14 for 2019 to 2021 model years for every 0.1 mile per gallon new vehicles fall short of required fuel economy standards. This amount is multiplied by the number of noncomplying vehicles sold. The fine rises to $15 for the 2022 model year". So for each Grenadier the fine would be roughly $1,000 per vehicle. Plenty of manufacturers don't meet CAFE standards. (Porsche for example)

 

[ChasingOurTrunks]

Not true. CAFE doesn't limit vehicle sales they just fine the manufacturer based on this equation. "The fine is calculated at $14 for 2019 to 2021 model years for every 0.1 mile per gallon new vehicles fall short of required fuel economy standards. This amount is multiplied by the number of noncomplying vehicles sold. The fine rises to $15 for the 2022 model year". So for each Grenadier the fine would be roughly $1,000 per vehicle. Plenty of manufacturers don't meet CAFE standards. (Porsche for example)

Too bad we can't say "Hey IA, give me a diesel without DEF/Regen, and build the fines into my purchase price, please and thanks!"

Environmental stewardship is critically important to me as a value, but I think the impact of a few thousand dirty diesels of this scale is pretty minimal when the ships they arrived on are still burning Bunker C, and the advantages for travel would be huge.

I know there are likely lots of reasons they can't do this but a guy can imagine!

 

[ZEN_OWT]

The build and ride quality are indeed fantastic. But when justifying the price tag, keep in mind that Ineos has saved money by cutting back on a ton of other features, including smart/driver assist functionality and cabin comforts. I'm on board with that design philosophy, but I'm not sure that it justifies the relatively high price. Steel is cheaper than software.

Ultimately, this is a low production vehicle and given the unaggressive pricing, I'm not sure that Ineos plans on expanding Grenadier production in the future. I'm coming around to the idea that this is probably a one-time-deal boutique 4x4. Would love to be proved wrong on that.

yeah, we'll i'm coming from a 4runner perspective. not a lot of cabin comforts there! So my bar is pretty low. haha. And the smart driving features I had permanently disabled because the sensors get uncalibrated every time i went off road.

That's what interested me about IG. I just want simple, solid and built for purpose, without having to do a lot a mods.

 

[Reducs]

Honestly, I would trade much of that for blind-spot "alert" (usually a little light on the outside mirror or similar). I think it's a fantastic feature that, while it may seem superfluous, makes "seeing" your blindspot much easier and safer - especially when there's lots of stuff in the vehicle and the side window(s) might be blocked. There is an endless supply of shitty, self-obsessed, distracted drivers in the US who will blindspot sit because they are, in fact, shitty, self-obsessed, distracted drivers.

Amen! I currently drive a Toyota FJ Cruiser and if ANY vehicle ever needed a blind spot alert it's that one. Not quite as bad as a panel van, but pretty close.

 

[RoadBuilder]

Blind squirrels find nuts and broke clocks are right twice a day - and to be clear I am the squirrel/clock! I did not know that but it sure feels good to know smart people use it too! Thanks for this!

The Big Mac Index shows that the Canadian $ is about 14.7% undervalued relative to the US $. That explains the difference in price for the Canadian Grenadier, as it would indicate a price of 15,340 Big Macs for a Canadian Grenadier. Slightly more than your calculated price of 15,087 Big Macs. Still very high, indeed, but it looks like currency values may be a big driver of that difference.

 

[Norville]

Not sure if this is the best place to ask, but as I try to make the purchase "work" ... what average insurance costs have people been seeing per year. I'll have to compare deductibles and insurance regs to see what is comparable in the US. I'm assuming a min of $1500-$1800 for decent insurance, but hard to say.

 

[40man]

Not true. CAFE doesn't limit vehicle sales they just fine the manufacturer based on this equation. "The fine is calculated at $14 for 2019 to 2021 model years for every 0.1 mile per gallon new vehicles fall short of required fuel economy standards. This amount is multiplied by the number of noncomplying vehicles sold. The fine rises to $15 for the 2022 model year". So for each Grenadier the fine would be roughly $1,000 per vehicle. Plenty of manufacturers don't meet CAFE standards. (Porsche for example)

Why are you using 2021 data for a 2024 MY car?

The standard for 2024 MY cars is 43.5 mpg. The trialmaster, if #s stick, gets 14 mpg. A 29.5 mpg miss. The penalty is $14 per 0.1 mpg missed or over $4,000 per vehicle.

So to clarify, the U.S. will allow Ineos to sell up to 4,999 without being subject to the CAFE standards. My understanding is if they go above that, the entire sales that year are subject to the standard.

With only one car in the lineup with poor mpg, that would be a lofty penalty.

So manufacturers with a blended lineup deal with the penalty because they have large sales and have no choice.

So Ineos can sell more, but the penalty to do so would be prohibitive.

 

[40man]

Toyota discontinued the Land Cruiser because not many people were buying a bare bones off roader for $80K+ in the US.

Although I did.

Toyota also did not advertise the LC in the U.S., nor did they import many. I think they had higher profit margins with other cars, and didn't care about the 200 series sales here unfortunately. The 300 seems to have some big improvements in offroad performance.

The new Tacoma looks like a big hit. I WAGER they WILL have a similar lineup w the 4Runner, but hopefully the ft-4wd is available across the lineup and not just with the limited.

 

[th_igloo]

I just specced out the exact build of Bronco my brother has, and it came out to $69,000. While cheaper, it is still in the ballpark of the Grenadier.

I recall my dad looking into LC200s back in 2017/2018. They were asking $84,000 back then, and so I just optioned out a similar spec current generation Sequoia TRD. it came to $86,000 (no, I did not check every box… far from it, really) and that doesn’t even have lockers.

While some say that you could buy X or Y vehicle and have so much $$$ left over, I think they may be looking at the base prices of those vehicles, and rarely does anyone buy the straight base vehicle.

I don’t think Ineos is horribly off here. Yes, I wanted it to be 5k less, but it’s still in the ballpark of acceptable looking at a host of other offerings.

While I agree that there are a lot of comparable vehicles out there that are within the same pricing ballpark of an IG, the one thing that IG doesn't have is the enormous support infrastructure of the other manufacturers. We're comparing first generation vehicle from a company that just started their automotive arm of the business. We don't have any history on IG reliability or what type of experience we would get with their service centers (which they won’t have a lot) compared to the others. So with that said, paying around ~$89K, not including dealer markups, taxes, etc… this will bring this vehicle to over ~$100K in my case. A little tough to justify in my opinion just because of what I just mentioned.

As a new vehicle from a new manufacturer, they should provide incentives like lower cost (especially for early reservations) just to get some foothold in the market and gain trust from us. Once the vehicle is proven to perform as advertised, excellent reliability, and ease of dealing with support centers, then they can re-visit pricing and will have better comparison to what’s out there. We can’t just compare vehicle prices as we have to look at the bigger picture.

 

[th_igloo]

As per the Ineos website: "We know you might want to do some work yourself. So, we’ve designed and engineered the Grenadier to be easy to work on inside and out. To help you we’ll provide online repair manuals, with support from the technical team at INEOS HQ just a call or a click away". Does not sound like they are going to be sticklers for dealer installation of fairly basic accessories.

To me, this phrase. -> “We know you might want to do some work yourself. So, we’ve designed and engineered the Grenadier to be easy to work on inside and out. To help you we’ll provide online repair manuals, with support from the technical team at INEOS HQ just a call or a click away"

Actually means -> “We won’t really have a lot of service centers to help you with your issues, so we really appreciate if you can do all the work yourself”

Not sure about you guys but I’m not the “do it all" kinda guy. If I’m paying ~$100K for a vehicle, even if I need help putting floor mats in, I better get the support I need.