Australian-made Ethan car reveal in early 2016

The next pivotal moment in ambitious Australian start-up Ethan Automotive’s plan to develop and build a range of passenger vehicles locally comes in the first quarter of 2016 when it reveals the name of its new brand, sketches of its three-model line-up and their engineering fundamentals.

The co-ordinated launch is designed to kick-start the company’s push for the investment funding required to get the scheme off the drawing board and to the stage of rolling its first model, an SUV, off the assembly line of a new factory in 2018.

In a change of tack, Ethan has switched its focus from gaining government backing for its project to seeking most funding from private enterprise. It has also re-budgeted its plan and now says it will need $750-$800 million to get to production, whereas its earlier estimates were around the $1.5 billion mark.

“We have worked really hard over the last few months to sharpen the pencil and be very focussed on what this business needs to look like and the amount of financing that it’s going to take to get the business case up and running,” Ethan Automotive Chief Operating Officer Matthew Newey told motoring.com.au.

“We have done an awful lot of work with respect to the vehicle, the bill of materials, the major component parts that will go into that vehicle along with tooling and the plant infrastructure.

“We are now in a positon in respect to the financials where we think it is a very attractive proposition for private equity and in doing that we have become less reliant on any funding we may or may not get from state or federal government.”

As previously reported by motoring.com.au, Ethan Automotive is the brainchild of a two real estate developers who believe a local car manufacturing industry is viable post the pull-out of Ford in 2016 and Holden and Toyota in 2017.

Automotive industry veteran Newey was appointed in May to pull the project together.

Much initial focus was placed on winning financial support from the federal government and the two primary automotive states, South Australia and Victoria, but their responses have been lukewarm publicly.

A key element of the negotiations with the Department of Industry, Innovation and Science in Canberra has been gaining Motor Vehicle Producer (MVP) status for Ethan, which would open up investment subsidies to suppliers from the Automotive Transition Scheme (ATS). The future of the ATS is currently a subject of scrutiny in federal parliament.

Newey said negotiations over MVP status continue.

“We continue to work on that with the department and the minster’s office, but there is no update on that. We continue to provide information and think we will for a while yet. We are very hopeful we will achieve MVP regardless of ultimately what happens with the ATS scheme. What will be will be in that space.”

Newey would not reveal which design company Ethan had collaborated with to produce the drawings of the SUV and the passenger car and sports car that are intended to follow it into production. Nor would he reveal the engineering partner that was performing the initial engineering package of work.

“I am very excited about the design direction of Ethan Automotive,” was all he would say.

The brand name is also not yet ready for public reveal, although he did confirm it was an all-new badge rather than one taken over from a defunct international brand as had been considered at one point.

“It will be an all-new brand, logo and marque. We are working very closely with a branding company and it will be an all-new Australian car brand and marque. We will be launching that along with the designs in the new year, most likely in the first quarter is what we are shooting for right now.

“Everything will come together in the first quarter of next year and we aim to launch everything in an appropriate way then.”

No decisions on issues such as plant and head office/design and development centre location, added staff for the business and the appointment of supplier partners will be made until or if the project receives adequate financial backing. Ethan Automotive also remains essentially a one-man band with workforce and funding support coming from its parent company.

Newey said while the Ethan concept of a highly modular vehicle and assembly plant remained valid, the location of a plant and a headquarters/design and development centre remained undecided. South Australia has been mooted as the home for the plant and Victoria for the HQ.

Newey said the Australian car market's continuing love affair with SUVs ensured Ethan’s planned product roll-out cadence remained as first revealed earlier this year.

“The SUV continues to be primary vehicle and launch vehicle for us and [with] the way that sales continue to cannibalise passenger cars and almost every other segment of the market you can see why it’s so important for us to get it right as the launch vehicle.”

For more on Ethan and its plans check out these earlier stories:
>> Ethan's car-making model 'brilliant
>> Labor backs auto funding to 2021
>> Ethan: Feds still waiting for 'formal proposal'
>> SA rejects Ethan's bid for bucks
>> Australian-made SUV the priority for Ethan
>> New Aussie car-maker confident of success
>> Property and pollies behind Aussie auto-start-up
>> Ethan seeks taxpayer dollars
>> Global badge for Aussie industry relaunch