Americas The threat to Ineos Dealers

[255/85]

Agreed - I think Ineos missed the mark on not only the size of the US market, but the owner profile. The Grenadier at $80k average lands squarely in the US upper middle class - 40-50 million consumers according to a quick google.

That said, I don't think the US dealer network can afford to scale geographically in the short term. I think it only makes financial sense to focus Grenadier dealerships on high population, high income areas. The good news is this will likely sort itself out naturally, dealerships without sufficient buyers and service within a normal range won't be able to stay in business.

For example, I really question the longevity of RDS in Philadelphia. Now that there is coverage for the DC Metro, a 2 xNJ, NY and CT... Who's driving all the way to Philly? It'd probably be more logical to put a second dealer on the south side of the DC Beltway.

Which begs the question " How do you increase sales in areas outside reasonable distances from a dealer?"

Answer: Owner service reset ability, a scan tool, and a workshop manual.

Most of the real problems have been sorted with a few outliers like the front driveshaft or whiny steering boxes, etc. There may be a few other things that will pop up over the years but I can't imagine what that will be as the parts used in this these vehicles are pretty solid. That means Ineos playing everything so close to the vest is becoming inappropriate. Most buyers will have the dealer perform every repair while under warranty and a sizable portion of those will continue to do so long after the warranty has expired but not if you live a day's drive away - or use one far away from a dealership network. The various resets requiring dealer input reveals just how uncertain they were after entering this entirely new field with an entirely new product.

Providing a manual may have seemed at some point like cutting their own throat but It will need to happen. A readily available workshop manual will prove that the Grenadier is the rightful heir to the OD/LC70 thrones, drive consumer confidence with both the hardcore users and the wannabes, and promote sales both within and outside of the shrinking dealer loci. Which would they rather have? Full service bays by milking every penny out of their current owners or full service bays and full pockets from higher sales?

 

[[ Adam ]]

Which begs the question " How do you increase sales in areas outside reasonable distances from a dealer?"

Answer: Owner service reset ability, a scan tool, and a workshop manual.

While I agree that providing the above will enhance the ownership experience of many, I don't think this will lead to a significant increase in sales to consumers living outside of a dealer service area. It will lead to some sales, but I don't believe they will be impactful. I think real rural market penetration will require a dealership model that is subsidized by Ineos OR some sort of service tie-up that would currently have a negative impact on fledgling dealerships. I think that service network probably makes sense once the major market dealerships are stabilized and have a sufficient customer base to draw on for new/used sales and non-warranty labor.

 

[255/85]

While I agree that providing the above will enhance the ownership experience of many, I don't think this will lead to a significant increase in sales to consumers living outside of a dealer service area. It will lead to some sales, but I don't believe they will be impactful. I think real rural market penetration will require a dealership model that is subsidized by Ineos OR some sort of service tie-up that would currently have a negative impact on fledgling dealerships. I think that service network probably makes sense once the major market dealerships are stabilized and have a sufficient customer base to draw on for new/used sales and non-warranty labor.

I see your point. The rancher busy during calving season or at harvest time just wants his vehicle repaired and back on the road. Likewise the busy weekender. A workshop manual is not a substitute for a true service network but you've got to start somewhere. In the meantime we wait for that stabilization. So what would bring that about as quickly as possible?

I'm guessing advertising. (@Zimm)

I don't know where their advertising budget is aimed but, for some reason, I still have to search out concise overviews of the vehicle's design and capabilities when I want someone to know what the hell these things are. If Ineos is not going to bombard every form of media with advertising - like Toyota or Ford or GM - then they need to do it on their dedicated website. If I send someone to ineosgrenadier.com the first thing that should hit them in the face is a high-production overview of the who & what of the vehicle. It doesn't. Instead I have to try and remember some utoob boob's channel to refer them to watch an accurate review. I understand not wanting to be crass and boorish but it's like they're embarrassed to toot their own horn. I'll say this for Toyota: I almost got a chubby after watching a very well done ad for a Camry the other night... and I hate those things!

 

[[ Adam ]]

I don't know where their advertising budget is aimed but, for some reason, I still have to search out concise overviews of the vehicle's design and capabilities when I want someone to know what the hell these things are. If Ineos is not going to bombard every form of media with advertising - like Toyota or Ford or GM - then they need to do it on their dedicated website. If I send someone to ineosgrenadier.com the first thing that should hit them in the face is a high-production overview of the who & what of the vehicle. It doesn't. Instead I have to try and remember some utoob boob's channel to refer them to watch an accurate review. I understand not wanting to be crass and boorish but it's like they're embarrassed to toot their own horn. I'll say this for Toyota: I almost got a chubby after watching a very well done ad for a Camry the other night... and I hate those things!

US Marketing has been a total and complete fail.

I'm tired of acting as a Grenadier spokesperson every time I leave the house. After a year anda half, I have no interest in having conversations with the constant "What is that thing?!?" inquiries. It's high time Ineos educated the public on their product.

 

[255/85]

So it's not just me. I'm starting to find it difficult to not be rude and brush people off when I'm in a hurry.

 

[AWo]

Hold your horses, hombres. I think you're looking at this all wrong. Those are actually excellent numbers. Here's why I say that:

I'm convinced (by the smarter folks here) that Ineos believed the majority of sales would happen in the UK and the EU followed by ZA and AU/NZ. The US was almost an afterthought.

There is clear evidence, that this is not the case. It is vice versa, the US was a key market right from the start. BTW, that is one of the most important decisions before you plan any car. You need to plan it right from the beginning for the designated markets. You'll not be able to add market specific modifications later, nor change your production in this direction. So every car manufacturer starts with all markets in mind, they want to sell to.

From an interview with Dirk Heilmann in 06/2020 (Automobilwoche):
Mark Tennant identifies here Europe, USA and Australia as the main markets. And that the Grenadier should become a lifestyle car for enthusiasts.

From an interview I did with Mark Tennant 03/2020 he told me that the Grenadier will be available in Europe first, then North America (however, in reality Australia was served before the USA):

Im Gespräch mit Mark Tennant von Ineos Automotive über den Grenadier

Seit ziemlich genau 3 Jahren ist bekannt, das Jim Ratcliffe den Geländewagen schlechthin entwickeln und produzieren möchte. Dazu gründete der Inhaber des Petrochemie-Riesen INEOS eigens eine Automotive-Sparte. Einiges ist seit dem passiert, zuletzt die Bekanntgabe der Kooperationen mit BMW...

matsch-und-piste.de

From an article 06/2021 (Automobilwoche):
Dirk Heilmann speaks about the sales modell and the the car first sales will be in Europe and the US will follow.

From 07/2021, BMWBlog (https://www.bmwblog.com/2021/07/09/...the-bmw-powered-off-roader-you-always-wanted/)
"Sales of the Ineos Grenadier are said to start in 2023, with the European market getting it first but North American sales to follow. If you love BMW but always wanted an off-roader, this could be the car for you. It’s not going to be cheap but it’s going to be a very interesting vehicle, designed from the ground up to be a no-nonsense off-roading machine. It also gets BMW power, so it should be dependable and fun to drive."

From an article 02/2022 (Automobilwoche)
"Jim Ratcliffe thinks further on - he doesn't want to sell the Grenadier not only in Europe but also in America and Africa".

From an interview with Lynn Calder in 09/2023 in the German Automobilwoche:
She said, that they put great hope into the US market. After opening the order books it has immediately become the major market for Ineos.

Another interesting statement from an Australian interview in 2020: "“We’ve got some great innovative ideas on service networks… which is really fundamental [to the Grenadier’s success]. The biggest ‘why not buy’ is where do I get my parts and where am I going to get it fixed.”"

INEOS Grenadier debuts - carsales.com.au

Unapologetic 4x4 wagon unveiled; UK-based maker promises unrivalled off-road ability and LC70 pricing

www.carsales.com.au

AWo

 

[Tazzieman]

US Marketing has been a total and complete fail.

I'm tired of acting as a Grenadier spokesperson every time I leave the house. After a year anda half, I have no interest in having conversations with the constant "What is that thing?!?" inquiries. It's high time Ineos educated the public on their product.

Write a small paragraph, print it out 10x on A4 page and cut it up as handouts.
You'll feel warm and fuzzy , and oxygen will be saved!

 

[ryanjl]

While I agree that providing the above will enhance the ownership experience of many, I don't think this will lead to a significant increase in sales to consumers living outside of a dealer service area. It will lead to some sales, but I don't believe they will be impactful. I think real rural market penetration will require a dealership model that is subsidized by Ineos OR some sort of service tie-up that would currently have a negative impact on fledgling dealerships. I think that service network probably makes sense once the major market dealerships are stabilized and have a sufficient customer base to draw on for new/used sales and non-warranty labor.

I said this in the other thread, but I disagree. I believe there is an ocean of potential Grenadier buyers who haven't bought yet because there is no service option reasonably close, and potentially even more buyers who live close to a dealer but are reticent out of concern of what happens if they are on the road somewhere and break down hours away from a place that can work on them.

Ineos can keep the existing dealer network, but amp up service options and tap into this market. Seems like, as a goal, any place with a Land Rover dealership should have a place that can work on Ineos.

 

[[ Adam ]]

I said this in the other thread, but I disagree. I believe there is an ocean of potential Grenadier buyers who haven't bought yet because there is no service option reasonably close, and potentially even more buyers who live close to a dealer but are reticent out of concern of what happens if they are on the road somewhere and break down hours away from a place that can work on them.

Ineos can keep the existing dealer network, but amp up service options and tap into this market. Seems like, as a goal, any place with a Land Rover dealership should have a place that can work on Ineos.

I find it unlikely that Ineos can garner more sales in less populated areas of the country than those with higher population densities. It's just not logical to me.


Even if you spread it across the country, the concentration of upper-middle class wealth (the buying sweet spot) is more prevalent in high population areas. Ineos should look to maximize sales by locating dealerships in the goldilocks zone of high median income and population density.
Median income:

Population Density (the previous map was from 2003):

 

[ryanjl]

I find it unlikely that Ineos can garner more sales in less populated areas of the country than those with higher population densities. It's just not logical to me.


Even if you spread it across the country, the concentration of upper-middle class wealth (the buying sweet spot) is more prevalent in high population areas. Ineos should look to maximize sales by locating dealerships in the goldilocks zone of high median income and population density.
Median income:
View attachment 7902885
Population Density (the previous map was from 2003):
View attachment 7902889

Not sure why you quoted me because your post does not address what I wrote. I did not advocate for adding more dealers. If, for whatever reason, Ineos wants to hold off launching more dealers, I'm talking about maintaining the existing dealers and launching a bunch more service locations, or otherwise authorized service places.

Ineos' current dealer network does not even begin to cover all the dense population areas in the U.S. Hell, Land Rover came to the U.S. in 1985 with 36 "charter" dealers, and the U.S. population has grown over 40% since then. Upper middle class would be fine travelling to one of the existing dealers to buy so long as they knew they could get their vehicle serviced nearer their home.

As far as those who already live near a dealer go, if Ineos is going to even begin to live up to its adventure aesthetic, it has to facilitate service for its customers who dare take them up on it. An expanded service networks helps fill that need.

I won't begin to unpack your theories on density and money. While true, what they ignore is that Ineos has to appeal to the right kind of people with money, and there are a lot of those kinds of people in the areas that Ineos currently does not serve.

 

[[ Adam ]]

Not sure why you quoted me because your post does not address what I wrote. I did not advocate for adding more dealers. If, for whatever reason, Ineos wants to hold off launching more dealers, I'm talking about maintaining the existing dealers and launching a bunch more service locations, or otherwise authorized service places.

Ineos' current dealer network does not even begin to cover all the dense population areas in the U.S. Hell, Land Rover came to the U.S. in 1985 with 36 "charter" dealers, and the U.S. population has grown over 40% since then. Upper middle class would be fine travelling to one of the existing dealers to buy so long as they knew they could get their vehicle serviced nearer their home.

As far as those who already live near a dealer go, if Ineos is going to even begin to live up to its adventure aesthetic, it has to facilitate service for its customers who dare take them up on it.

I've already covered why I don't think adding additional service centers makes sense in the short term. Longer term, sure.

 

[ryanjl]

I've already covered why I don't think adding additional service centers makes sense in the short term. Longer term, sure.

Yeah, and that's what I disagree with. I think the existing dealers would love to sell more vehicles regardless of whether they have to service them. Your idea is that the dealers would lose out on servicing those vehicles. What I am saying (and I think it's pretty obvious what I am saying) is that those are vehicles that would not be sold at all without the expanded service network.

 

[Rayzar]

In our state of Western Australia the dealer said they sold 30 cars since Jan. It's not alot but there's potential for alot more over here. With only one dealer here, the idea of a mobile tech travelling around the state in a quarter master makes alot of sense. Servicing, minor repairs, pads etc. Anything major could be booked into the main workshop and have the parts ordered well before by the tech. They could even offer a roadside assistance. It'd reassure me in a purchase out in remote areas instead of me trying to get a car back to the dealer some 2000kms away, which would cost an arm and a leg. Not to mention the caravan that may be on the back. These cars are so nice and a welcome change to the 4WD community that I so hope they succeed long term.

 

[Logsplitter]

That would be great everywhere. Pretty much how agricultural mechanics work here in the U.K. and much of the world I guess. You get a problem with your tractor or harvester and the mechanic/technician comes to site to fix the machine.

 

[[ Adam ]]

In our state of Western Australia the dealer said they sold 30 cars since Jan. It's not alot but there's potential for alot more over here.

I've heard rumor my local dealer is around 3-3.5x that amount - a number which is insufficient.

 

[MattA]

I've already covered why I don't think adding additional service centers makes sense in the short term. Longer term, sure.

There will be no long term if Ineos doesn’t address the current situation

 

[NQ94]

Imo Ineos should really start pushing harder into fleet sales in Australia, SA and Europe as the Grenadier and QM are the right sized vehicle to compete against the traditional work 4x4s in these markets. Maybe introduce a single cab as these are the biggest sellers for LC70 which QMs only live axle equivilant in most markets. What is often commented with Grenadier sales is the people retiring or buying their forever 4x4 this eventually means limited future repeat sales from these customers. Pushing the vehicle into traditional LC70 or Defender commercial markets that constantly turn over vehicles will increase both new and used sales, parts and service availability.
Like original Jeep, LC 40 and 70, LR Series and Defender they didn't earn their reputation from being a pampered enthusiasts vehicle all earned their true reputation working in fleets, businesses and in fleet workshops. This allowed all of them to solve issues in less time and deliver more options to private buyers.
We don't want to see Ineos as a two model brand struggle like Harley Davidson did recently as traditional enthusiasts dried up and the brand struggle for a new demographic to keep relevant.

 

[LC0013]

https://imgur.com/a/Axev9mQ

View: https://imgur.com/a/Axev9mQ

 

[PalmCoveWagon]

In our state of Western Australia the dealer said they sold 30 cars since Jan. It's not alot but there's potential for alot more over here. With only one dealer here, the idea of a mobile tech travelling around the state in a quarter master makes alot of sense. Servicing, minor repairs, pads etc. Anything major could be booked into the main workshop and have the parts ordered well before by the tech. They could even offer a roadside assistance. It'd reassure me in a purchase out in remote areas instead of me trying to get a car back to the dealer some 2000kms away, which would cost an arm and a leg. Not to mention the caravan that may be on the back. These cars are so nice and a welcome change to the 4WD community that I so hope they succeed long term.

That’s only 5 a month. That’s really slow.

 

[Rayzar]

That’s only 5 a month. That’s really slow.

Yeh mate it's very slow but there is the interest. NQ94, you make a strong point about getting into fleet sales. I work in the mining industry and theyre replacing the cruisers with rangers soon as they have a 5-star ANCAP rating. Ineos could do extremely well here by asking the big miners to purchase a few each and offer free service and just pay for parts to test there ruggedness for 1 year. If they survive then offer them a fleet deal. At the very least it would give Ineos a great test bed to prove the brand in Australia side by side where toyota gained a solid reputation . At the moment Ronny Dahl is the only one advertising the brand here and thats how i found out about the brand. Imagine if the media advertised, "Ineos enters Pilbara mining Industry". Wouldn't take long for the brand to become very well known down under