The reborn TVR project has been delayed by European Union rules causing a seven-month tender process for construction work on the factory.
TVR revealed the all-new Griffith at the Goodwood Revival in September last year, but public updates on the project have been infrequent. Now Autocar can reveal that progress at TVR has temporarily stalled due to an unintended consequence of the Welsh government’s 3% purchase of a stake in the company alongside a £2 million loan earlier this year.
That deal means that TVR is now subject to EU rules around state funding, so the construction work needed on its currently dilapidated factory in Ebbw Vale, South Wales, has had to go out to tender across the entire EU, rather than to only local firms.
That seven-month process is ongoing, and won’t be completed until January 2019, meaning construction work on the new factory is still many months away from starting.
First deliveries of the new Griffith had been slated for early 2019, but that target is now optimistic given the significant amount of work still needed to hit that deadline.
“It’s frustrating, that’s for sure,” TVR boss Les Edgar told Autocar. He revealed that the construction work will take around six months once the tender is awarded and the contractors take over the site.
In the meantime, TVR is hoping to carry out some if its own prep work on the site to help speed up the process.
Edgar cannot put a date on when production will start, but said it’s possible some work could begin in March at a building next door to the factory that TVR had planned to use for training and development.
As for the development of the car, Edgar said 75% of the parts had now been sourced for the Griffith, which will use a Ford-sourced and Cosworth-tuned 5.0-litre naturally aspirated V8 with 500bhp.
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Date
March 29th , Jobs a good'en
£2.5m goes a long, long way in the car industry
Another sound investment by the Welsh government. Just enough to have all the signage translated into Welsh...along with the stationary...and the paperwork...and the small print...
Lawyer
Yep, this is the reason companies employ lawyers. Sounds like TVR need a new one.........
Some actual research
So, unlike this publication, I’ve carried out some actual research.
This factory building is owned by a charitable foundation. They have agreed a lease with the Welsh Government. Whether or not the Welsh Government has agreed sub-lease terms with TVR (or the company acting for TVR) is unclear.
The owners have commited £4.5miliion to the building (it has been empty since 2002), which includes new below ground drainage, demolition and construction of some new buildings. Again, so far nothing to do with TVR. Capita are the construction project managers. This makes me clench, a bit, but we are where we are with that.
I’m more interested in this aspect. The commitment from the owners also happens to be at the GBP threshold where EU tendering rules apply. If this is the same sum of money then it would appear that the foundation have loaned the money to the Welsh Government. The Welsh government have also loaned £2million to TVR and bough very small stake for £500k which puts them on the hook for quite a lot of taxpayer’s money, though the 3% stake “may” give them some protection as creditors, which is wise.
so that’s £7million of other people’s money committed to this. Then there’s around £2.5million in customer deposits (500 at around £5k each it is said to be).
So far we have just a prototype (which looks great inside, and outside from most angles, and sounds phenomenal) but not much else. The investment in the building only counts if TVR are in fact the sub-tenant and, in any case, represents no asset to them.
I really don’t know what it would have cost to develop the prototype. I can easily imagine fees eating up the deposits, and the WG loan being spent on prototype construction (vice versa, or a combination of). Fitting out a factory doesn’t come cheap. Do TVR have other investors, with deeper pockets? There doesn’t seem to be much more visible investment.
Touching on the nearby Circuit of Wales, it seems that the local authority are completely on the hook for it. They have recently submitted further planning applications. I imagine that they consider it too far gone - in terms of their commitment - and so are seeking to get the consents in place and then attempt to find a serious buyer that won’t have to do the boring stuff to get it going.