Jobs fear as Ineos rethinks plan for car plant in Wales
INEOS Automotive is considering scrapping its plan to build a car plant in Wales, the manufacturer has announced.
The firm said it is in talks with Mercedes-Benz over acquiring the German company’s Hambach factory in Moselle, France, instead of building new facilities in Bridgend and Portugal.
Production of a new 4x4 vehicle named Grenadier was due to begin in Bridgend next year.
The company had announced last year that it would build its new factory next door to the Ford plant in Bridgend which closes in September, with the loss of 1,700 jobs.
Around 200 jobs were due to be created initially at the planned new plant, but that was expected to increase to 500 once the vehicle reached full production.
But Ineos Automotive chief executive Dirk Heilmann yesterday said: “Over-capacity has long been a major issue for the automotive sector.
“Of course we considered this route previously, but, as a result of
the Covid-19 pandemic, some new options such as this one with the plant in Hambach have opened up that were simply not available to us previously.
“We are therefore having another look and reviewing whether the addition of two new manufacturing facilities is the right thing to do in the current environment.
“Covid has had an impact on our build schedules with ground-clearing works and construction held up by the social distancing measures that have been required. Safety is, of course, paramount, but we also have an obligation to do what is right for the business and so need to assess these new opportunities in order to maintain or improve on our timelines.”
Under Ineos’ original plans, Portugal would make the body parts, which would then be shipped to Wales and assembled in a new custom-built facility.
But taking on the new site in northeast France would potentially mean the company wouldn’t need to build the factory in Wales and another in Portugal.
The potential loss of the two sites is a hammer blow to the 1,000 workers in both countries who had expected to be hired for the project.
Last week it revealed the first images of its new off-road vehicle with clear design references to the muchloved old Land Rover Defender, which went out of production in 2016.
Production was scheduled to commence next year, in what would have been a timely investment for the automotive sector in Wales.
The factory was planned to be built on the 100-acre Brocastle site, which is owned by the Welsh Government, next to Ford’s factory.
The Ineos project was secured with promise of a significant financial package of support from the Welsh Government, but with backing also from the UK Government’s department for Business, Energy and Industrial Strategy.
A Welsh Government spokesperson said: “We have invested significant time and money in this project and, should the situation arise, and Ineos decide not to invest further in Wales we will of course look to recoup appropriate costs from the company.”
Bridgend MP Jamie Wallis said: “We have a skilled workforce in Bridgend experienced in the automotive industry and the prospect of the 200 new jobs at Ineos was important to offset the loss of jobs taking place with the closure of the Ford engine plant. If the scheme had gone ahead, it was hoped that a further 300 jobs would have been created at the plant.”
Health Minister Vaughan Gething said: “It’s obviously extremely disappointing that Ineos are casting doubt on the investment in Bridgend. If they do go ahead and decide not to make that investment then that would be a really significant step backwards for Bridgend.”
Helen Mary Jones, Plaid Cymru shadow minister for the economy, said: “The fact that a site on mainland Europe appears to be favoured over a site in Wales may be a sign of what we risk, post-Brexit.”
A UK Government spokesperson said: “We’re continuing to work to ensure Wales and the whole of the UK is an attractive location for cuttingedge automotive technologies – just last week making £10m of funding available to scale-up low carbon innovation. Today’s news from Ineos is disappointing but we will continue to work alongside the Welsh Government to support the automotive industry in south Wales.
“Through our unprecedented package of measures during the coronavirus pandemic we have also supported more than 418,000 people in Wales through the job retention and selfemployment schemes, as well as provided support for businesses through government-backed loans and VAT deferral.”