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Tycoon says he needs subsidy to build Land Rover Defender successor in UK

The last Land Rover Defender comes off the production line.
The last Land Rover Defender comes off the production line last year. Ineos plans to make an ‘unbreakable’ version of the car. Photograph: Land Rover UK PR/Twitter/PA

The billionaire businessman Jim Ratcliffe has warned that it would only be possible to build a successor to the Land Rover Defender in the UK, creating up to 10,000 new jobs, if the project receives government backing.

The founder and chairman of the chemicals firm Ineos said Britain was the “number one” choice to invest about £600m in a new 4x4 off-road vehicle that could fill the gap in the market left by the Defender, which Jaguar Land Rover stopped making in 2016.

He added that while Ineos was having “positive” conversations with the UK government, options included a number of other countries, such as Germany, where skills and facilities were more readily available.

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“It would be quite a challenge to do it in the UK without a subsidy because there are facilities and trained workforces [elsewhere], so in the UK we get higher risk and higher costs. At the end of the day it has to be a profitable venture.”

Ineos said it would make a decision on where to build the 4x4 off-roader within the next nine to 12 months, with the first vehicles rolling off the production line in 2020-21 and priced from about £35,000. Volumes are expected to reach 25,000 vehicles within three years, and it would be available in diesel, petrol and hybrid versions.

About 1,000 jobs would be created directly, the company said, with another 5,000 to 10,000 created indirectly among car part suppliers and other service providers. If it did opt for the UK, a new factory would be located somewhere along Britain’s east coast, possibly Grangemouth in Scotland or Hull, where Ineos already operates.

Ratcliffe said a “catastrophic” blow had been dealt to the UK manufacturing industry over the past two decades, with its contribution to the UK economy falling from 23% in 1990s to less than 10% today.

“We are not afraid of manufacturing challenges and I think the UK does need a few manufacturing challenges. In an ideal world we would like to build it in the UK, which is obviously its heritage. But it has to make economic sense and we have had a surprising amount of interest from the continent using existing facilities. You would have to build a new facility in the UK.

“Workers’ skills are a challenge in the UK – not an insurmountable challenge – but you would need to train a complete workforce in the UK. Nissan have done it and Toyota have done it in Derby but if you go to places like Germany, you’ve got a trained workforce.”

He said the aim was to build a more reliable, “unbreakable” version of the Defender, whose famous owners included the Queen.

“It was the world’s most famous car. It conquered the planet in many ways,” Ratcliffe said of the Defender. “It was the world’s best off-road vehicle – not the most reliable – and we lamented its demise two years ago when Jaguar Land Rover said it was stopping production. It’s 67 years old but it still looks cool today.

“Maybe it’s a little bit arrogant for a chemical company to think it can produce a world-class 4x4 but we have the confidence that we can manufacture things. We’re very prevalent in Germany. We have a lot of German engineers and a great respect for German engineering. I think there will be a step change in the quality of this vehicle.”

Jaguar Land Rover is already working on an updated version of the Defender and a spokesman for the company said the original design had been registered in many countries, with a trademark application currently under way in Britain.

He added: “We fully believe we have proprietary rights on this vehicle. It is one of the most recognisable shapes on the road.”

Ineos has yet to produce a specific design or name for its version of the car, nicknamed “Projekt Grenadier” after the London pub in which the idea was conceived.

Ratcliffe said he was confident the demand would be there for the new 4x4, which he described as “an honest” vehicle which would appeal to farmers and adventurers alike. Key target markets initially would be the UK, mainland Europe and the US.