Ineos Automotive Faces Tariff Threat Ahead of Key Market Decisions

Sir Jim Ratcliffe’s Ineos Automotive could find itself in dire straits due to the proposed rise in US tariffs on the automotive sector. The chief executive, Lynn Calder, has expressed her concerns that the firm might experience substantial operational challenges as a result of these decisions.

The company currently manufactures vehicles at a former Mercedes-Benz factory in Hambach, France, with production of its Grenadier Quartermaster pick-up truck already well underway. Since launching, Ineos Automotive has put around 22,000 vehicles on the road and possesses the capacity to increase annual production to 30,000 units.

With the US emerging as a critical market for Ineos, Calder has publicly criticised the European Union’s approach to trade negotiations. Presently, US import tariffs on vehicles from the EU are at 2.5 per cent, while US-made cars entering the European market face a 10 per cent tariff.

The warnings from Calder have heightened in light of President Trump’s recent indications of escalating tariffs on automobiles to 25 per cent. She stated that this inequity in tariffs represents a significant risk for smaller brands such as Ineos, bringing the phrase “life and death” into discussions regarding their future viability.

The pressures of these tariffs have led Ineos to reconsider its production strategies. Although a factory in Bridgend, South Wales had previously been a consideration, Calder noted that focusing production efforts in the US would be more advantageous given that over 60 per cent of their business stems from that market. Any potential shift to UK production would likely require more time and resources than initially anticipated.

As Ineos Automotive navigates these turbulent waters, the ramifications of trade policies will be crucial in determining the firm’s future and strategies for maintaining its market footing.