With many in the automotive industry – most recently Mercedes-Benz – turning their backs on smaller models due to razor-thin profit margins, today’s news that Ineos’ second production model after the Ineos Grenadier will be a smaller 4×4 surprises and intrigues on many levels. .
Land Rover, never far from an Ineos comparison (and is it any coincidence that the Ineos news comes on the same day as the Land Rover Defender 130 reveal? I don’t think), has long sought to make models more small, but the likely return on investment makes them unsustainable.
Indeed, when you have year-plus waiting lists for models like the full-size Range Rover (whose average transaction price would now be around £125,000) and the Land Rover Defender, why s bother to reduce anyway?
After all, it costs as much to design a small car as a large one, but manufacturers can’t compensate for that with a higher list price, and so profit margins are squeezed.
So what did Ineos see that the others didn’t? Or perhaps more pertinently, what will potential Ineos customers not get from the Grenadier that this proposed model will bring them?
When Ineos launched its stand as a car manufacturer, its mission was very simple: to build a car to fill the void left in the market by the departure of the original Defender. The Grenadier fulfills this mission.
With today’s news, that core mission moves away: the new model will not only be smaller but also electric and built on a new platform as well.
These last two aspects again mean that significant investments must be made without any obvious advantage of economy of scale by deriving it from the Grenadier.
How small is it? It’s yet to emerge, but there are around four different sizes of 4x4s Ineos could slot under the nearly five-metre-long Grenadier, which starts at £49,000.
The higher price of electric technology alone could also make the car more expensive than the Grenadier. Smaller, yes, but cheaper is by no means a given. Those margins again…
Ineos will soon start delivering cars – a huge milestone and achievement. He walked through the toughest valley that many aspiring automakers typically fall into: getting a concept into production, due to the huge investments required, the kinds of safety and legislative requirements that need to be met, the needs of durability and reliability, as well as making thousands or parts, both physical and digital, work together seamlessly.
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This notice was published: 2022-05-31 14:33:16