Henry Payne: How Ineos got a gas-fired, startup automaker off the ground
Published in Business News
ASPEN, Colorado — The early 21st century auto market has experienced a flurry of startup automakers not seen in a century. Following in the footsteps of Tesla Inc., new battery-powered vehicle makers have been inspired by a new electric market, government EV mandates, and fat taxpayer subsidies.
Startup, internal-combustion-engine-fired automaker Ineos Automotive Ltd. is an exception.
The Brit brand sees an opportunity in a different niche market as it brings its straight-6-cylinder-powered Grenadier SUV and Quartermaster pickup to the ring in the hot, premium, off-road segment competing against heavyweights like Land Rover Defender, GMC Canyon AT4, Jeep Wrangler Rubicon and Ford Bronco Raptor.
Like its fresh-faced EV peers, Ineos is jumping into the world’s most ferociously competitive consumer market with a team of risk-takers who believe their product offers a unique answer to consumer needs. The Ineos story is one of overcoming the mountain-sized hurdles of design, funding, manufacturing, marketing and regulation.
“If it were easy everyone would be doing it. We see a lot of people try and fail and I can completely see why,” said Lynn Calder, Ineos’ 45-year old, Scottish-born CEO in an interview. “It’s an extremely complex business that has probably never been as complex as it is right now.”
Unlike its EV peers, Ineos entered the market the old-fashioned way: without government assistance, without the need to build its own fueling infrastructure, and with faith in the traditional franchise dealer market to connect with customers.
“Electric is having its moment, and it’s got its place in the mix of powertrain needs for the customer, but I don’t think it’s everything,” Calder added. “We see an opportunity for a pure-blood, very mechanical, very capable off-road vehicle that (is) different than all the other cars on the road.”
Ineos’ journey stated a decade ago with petrochemical industrial billionaire and adventure seeker Sir Jim Ratcliffe talking with veteran South African guide Charles Van Rensburg about the void created by Land Rover when it discontinued its truck-based, off-road vehicle. The rugged Defender (reborn in 2020 as a unibody SUV) was the cornerstone of African safari adventures.
“We could see the gap in the market as vehicles were stepping away from that pure, go-anywhere 4x4,” said Ratcliffe’s son, George, who resides in New Jersey as Ineos’ president of the Americas. “Everyone was moving to SUVs and becoming street-only cars. That was the seed of our idea.”
The Grenadier SUV was born in its namesake — the Grenadier Pub in London — a favorite hangout of the Ratcliffes and Ineos employees. The dirt-kicker’s distinctive, macho shape was then penned in 2018 by famed yacht designer and Ratcliffe pal Toby Ecuyer. Ineos survived a lawsuit from Land Rover in 2020 claiming the company had stolen its boxy design, then bought an assembly plant from Mercedes in the eastern French city of Hambach.
With Magna International Inc. (which also makes the Mercedes G-Class and Jaguar i-Pace in Europe) as its industrial partner, BMW AG providing engines and ZF providing gearboxes, Ineos set out to sell in 50 markets with an eye on the biggest prize: the USA.
“The heritage of our story, the entrepreneurial aspect to it” has real appeal, said CEO Calder, noting iconic auto executives in the United States like Henry Ford and Elon Musk. “Sir Jim Ratcliffe funded this, designed it, developed it. This is his car. And I think Americans really champion entrepreneurs that do really cool things and stick their neck out and succeed. I think that really resonates in the U.S.”
On paper, the business model had back story, business partners and secure funding from Ineos’s parent petrochemical company. “Ineos appeals to bus boys and billionaires. It offers a tough mage even if it never goes off-road,” said Allison Worldwide auto analyst Rebecca Lindland, herself a veteran of Fisker Automotive’s (failed) EV startup. “Magna has consistently built high-quality vehicles.”
Calder smiled: “That was the easy part.”
The Scot joined the Ineos automotive team as CEO in late 2022 as the brand struggled to organize production. A university-trained economist, Calder had extensive experience in private equity and nine years as CEO of Ineos’ composites subsidiary.
“It’s systems, it’s people, it’s relationships,” she said. “Everyone thinks it’s about getting the system to deliver the right part at the right time. But if you don’t have your supply base knowing what you are trying to achieve, and you don’t communicate with them sufficiently? You need to build relationships and spend time.”
That meant consolidating a diaspora of Ineos employees — supply team in Germany, buyers in Portugal — to join production workers at Hambach’s “coal face,” Calder’s English slang for vehicle assembly.
She also made the decision — against the industry trend — to distribute Ineos vehicles through traditional dealer networks. As other luxury startups like Tesla, Lucid Motors and Rivian Automotive Inc. pursued innovative, in-house retail outlets, industry consultants told Ineos that manufacturer-led distribution was the future.
“BMW, Mercedes, everyone was going to it,” Calder said. “Whereas we had the chance to come in from the ground up. It was a persuasive argument, it was of its time. But we just learned that it is not the right thing to do.”
Ineos has built a network of 30 franchise dealers in the United States, including in Michigan, where Feldman Automotive Group has opened a dealership in Waterford Township. Calder said U.S. demand has been strong, already accounting for 60% of global sales.
“Where we are really excelling is in the U.S. where traditional dealers know how to sell cars,” said Ineos’ chief. “They do it very well, they look after their customers really well.”
Coupled with distribution, Ineos also had to put in place a marketing plan so its voice could be heard above the cacophony of multi-million-dollar consumer ad campaigns. That was not an easy ask of a petrochemical giant, a company that had made its fortune in business-to-business sales.
“The world needs to understand just how complex (the auto) industry is compared to B2B,” said Calder, noting that Ineos' only other consumer ventures were a small cleaning supplies company and a sportswear maker. “It’s great that we are manufacturing a car, but if nobody knows where we are, nobody is going to buy it. We are learning a new trade, a new, magic black art of marketing.”
In an industry where big players spend “a few hundred million a year” on brand advertising, Calder said Ineos has focused on targeted social media and sponsoring events like Olympic superstar Shaun White’s Snow League pro snowboard competition.
Hanging over these complex operational details is the constantly shifting climate of government regulation and trade policy.
“It’s insane. It’s important for the industry to be regulated, (but) there is something about this particular industry that has gone a bit mad,” Calder said of, in particular, European emissions regulations that are on target to ban internal-combustion engines like that used by Ineos by 2035 — with the United Kingdom threatening a 2030 ban.
“The policy is all wrong. In Europe and the UK right now they want it to be one-size-fits-all, and it’s breaking the industry and it’s not doing consumers any favors.”
The regulatory environment means Ineos — as well as its petrochemical parent that is also under pressure from regulators — has to divert resources to government lobbying. But Calder said it’s the “consumer that speaks at the end of the day. My view is the government stance in Europe . . . is not 10 years in the future, it is tomorrow, relatively speaking. And they are going to have to accept it’s just not going to happen.”
She takes solace in the transition to President Donald Trump in the United States, Ineos’ biggest market, and the move towards deregulation. But the Trump administration’s tariff policies brings other challenges.
“(Tariffs are) a huge worry particularly the levels (Trump) is talking about. We could absorb (a small) tariff giving the size of this market. But the levels that have been imposed on Mexico and Canada — which are in line with the 'chicken tax' — would basically mean our cars would be dis-incentivized,” she said. The chicken tax is the 25% tariff the United States already levies on imports of light-duty trucks from outside North America; Ineos is paying the tax on its Quartermaster pickups.
In the end, Calder hoped U.S. tariff threats will level the playing field and reduce tariffs between the United States and Europe. The European Union currently levels a 10% duty on U.S. auto imports, which is significantly higher than the 2.5% U.S. tariff on (non-pickup) vehicles.
“My view is Trump is a negotiator, and he’s talking about 25% because he says (trade is) unfair and you need to do something about it,” Calder said. “My hope is Europe will to come to the table; that is a better outcome. I think all (Trump) wants is parity, so . . . everything is 2.5%.”
That’s a lot on the menu for a startup automaker. The upside, Calder said with a smile, “is the most satisfying job I’ve had. My team and I have a lot of fun.”
It’s fun that Ineos hopes translates to its unique 4x4 products. “The Grenadier and Quartermaster are a celebration of the choice that’s in the U.S. auto market today,” said analyst Lindland. “They show that customers still want individual, customized, gas-powered cars.”
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