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Is Ineos in financial woes?

The UK Telegraph states that JR is threatening Scottland (or the UK) to close the site in Grangemouth completely incl. the loss of jobs.

AWo
 
The UK Telegraph states that JR is threatening Scottland (or the UK) to close the site in Grangemouth completely incl. the loss of jobs.

AWo
It was in the news in March. Losing $500,000/year; not exactly viable.
Grangemouth closure
 
Yes, but that was about the Petroineos stuff in March and April.

Now it's about the rest, the O&P (Olimers and Polymers) plant, about another 2,000 jobs. The biggest chemical plant in the UK left.

AWo
 
Grange mouth closing is all down to the UK governments hate for oil and gas , just becoming unviable for companies like ineos to stay here
"When will they ever learn?" Never, I'm afraid... The Chinese will be happy!
 
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In fairness to Ineos they bought it from BP who were planning on closing it 20 years ago. It’s ancient and like most downstream facilities run on a shoestring. Just ticking along, if it’s losing money for a company like Ineos (who are very lean compared to the majors) then it’s surely not viable for anyone else.
 
In fairness to Ineos they bought it from BP who were planning on closing it 20 years ago. It’s ancient and like most downstream facilities run on a shoestring. Just ticking along, if it’s losing money for a company like Ineos (who are very lean compared to the majors) then it’s surely not viable for anyone else.
Apparently you didn’t get the memo. When an ancient plant closes, it’s always about greedy unions and burdensome regulations, and never about owners and managers pulling huge profits and bonuses for decades without putting any money back into maintaining and updating the place.
 
😂

I can’t speak for Ineos but all the “traditional” oil companies I’ve worked with separate their upstream and downstream business for exactly this reason. Upstream is the sexy glamorous side that makes a metric shit load of cash. Downstream is the fat ugly sister that takes loads of maintenance and contributes fkall in cashflow. It becomes easy to plead poverty when a refinery is making a loss - and it’s easy to sell the crude to somebody else and let them refine it then retail it. The profit is in the crude and trading of it.
 
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Rating Agency Fitch downgraded Ineos the second time this year from BB to BB-. Money has become more expensive to Ineos by that downgrade again. Main driver is the Project One called new cracker in Antwerp, which increased the Ineos debts by €4 bn.

The UK Telegraph also mentioned what I was already stating here, the chemical buisness payed for Mr. Ratcliffes other interests (beside the chemical business), incl. the Ineos Grenadier, which are mainly lossmaking.

Ineos Enterprise wa salso downrated to B+ because of Ineos selling single business, weakening the business.

AWo
 
The Economic and Political System in the UK and EU are going to cause headwinds and worse for INEOS and many other companies. The legacy car manufacturers will survive by shrinking with the situation that ultimately plays out. I watch every morning two podcasts from the UK and they speak of the EU as well, its very concerning. However with INEOS, survival is going to be much more difficult. INEOS will need a lot of cash on hand. The sale of Bellstaff got my attention.
 
Very helpful thread - I was just musing with a friend about how INEOS Automotive was doing in the light of the wider coverage of the petrochemical issues (Grangemouth and the move to the US) and rationalising of the non petrochemical interests and sponsorships (clothing cycling football sailing rugby etc )

I hope it survives and receives adequate investment to thrive
 
Bloomberg wrote that Ineos Automotive stacked up a loss of $1,2 bio., yet. The article is from April.

Quote: "After racking up €1.08 billion ($1.2 billion) of losses to date, the venture is turning out to be a costly bet for Ratcliffe. The entrepreneur — who lists “losing money” as one of his biggest dislikes — faces the choice of shouldering losses for years, or pulling the plug, according to independent autos analyst Matthias Schmidt."

"Demand among European consumers is “well below that expected a few years ago when Ratcliffe was first setting up this venture,” said Michael Dean, an autos analyst at Bloomberg Intelligence. “We’re still 15% below the peak in 2019, and no one believes we’re going to get back to that level.”

Low-volume carmakers are under particular strain, with strong sales needed to offset high development and manufacturing costs. “If your volumes aren’t there then you’re just constantly having to put in cash,” Dean said."

"Even Ineos’ main chemicals business is showing signs of strain. Ineos Group Holdings, the conglomerate’s largest chemical unit, slipped to a €150 million loss in 2024 as debt-servicing costs climbed.

But the most consistently loss-making cog in the Ineos machine has been the auto business. In 2023, the most recent year for which figures are available and the first to include sales of the Grenadier, the company posted a €323 million loss, its biggest to date, on revenue of €501 million."

"Industry executives are always cynical when an outsider tries to create a successful car company from scratch, especially since so many have failed over the years, said Andy Palmer, former CEO of Aston Martin Lagonda Global Holdings Plc.

'In my experience, they can develop the car and buy-in the engineers to do it — but they always miss the complexity of manufacturing maturity,” Palmer said. “That’s typically where most people underestimate just how difficult developing a car is.' ”

After Fitch, Moody also downgraded Ineos from B1 to Ba3 "highly-speculative".

Some more business news news will follow, but they are not official, yet....

AWo
 
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Their biggest own goal has been poor quality integration, and going too fast into model specific customisation. Even the seats, yes they are recaro, are custom to the car. Simple things like the battery, custom. They were never going to be a mass market brand, they knew it, and I feel the biggest let down had been their overly ambitious misadventures into last mile customisations. Sucks.

And let's be honest, the reason we are here on this thread is down to the simple fact that the vehicle is non viable in the absence of their, dysfunctional, supply chain.
 
But the most consistently loss-making cog in the Ineos machine has been the auto business. In 2023, the most recent year for which figures are available and the first to include sales of the Grenadier, the company posted a €323 million loss, its biggest to date, on revenue of €501 million."
That is a bit on the misleading side though as costs of development were still ongoing and they had not ramped up product yet.

Lynn Calder stated earlier this year that IA is now running cash positive. So, whilst development losses will still be baked in, it does suggest that they daily running is positive.
 
How can IA run cash positive, when the biggest market, the US, is roughly 40% behind last year and other registration number fell down, as well.

AWo
 
😂

I can’t speak for Ineos but all the “traditional” oil companies I’ve worked with separate their upstream and downstream business for exactly this reason. Upstream is the sexy glamorous side that makes a metric shit load of cash. Downstream is the fat ugly sister that takes loads of maintenance and contributes fkall in cashflow. It becomes easy to plead poverty when a refinery is making a loss - and it’s easy to sell the crude to somebody else and let them refine it then retail it. The profit is in the crude and trading of it.
The short term spike that permits speculative investors to cash out. Long term slow growth will always be in the infrastructure. It's real estate. Real estate will always make money, the variable is who owns it when it does. SO, lets be frank, Sir jim had the choice to put money back into the place and have wealth in assets like a farmer, or go be a playboy and spend money that really wasn't meant to be spent on "marketing" like sports teams and americas cup boats. Now he want's to blame the British taxpayer for not covering his debts. Assholes like him callously ruin lives of dedicated employees, I'll take the depreciation on my car to watch him implode if his actions cost the livelihoods of working class Scot's.
 
Where was this asserted, that IA is running net positive ?
An AI scrape spits out:-
  • Despite challenges, Ineos remains committed to the car business and hopes to become profitable on an adjusted basis in the current year, according to Bloomberg.
Now there are massive sunk costs and walking away from a French factory is impossible without paying vast penalties, (which was why it was cheap from Mercedes/Smart in the first place), but if the cash flow has reversed, then keeping winding the handle becomes the least-worst proposition.
 
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