Image copyright Ineos Image caption Ineos says the new Bridgend plant will employ 500 people and produce 25,000 cars a year

Ineos Automotive has chosen Bridgend for the production of its new 4x4 vehicle, it has been announced.

It is expected to initially create around 200 jobs to make the Grenadier, and up to 500 in the long-term.

The company is building a manufacturing and assembly plant and plans to begin production in 2021.

It has received support from the Welsh Government, and funding from the UK Government as part of a competition to develop new technologies.

The new plant is being built at Brocastle, close to Ford Bridgend, which is to close in 2020 with the loss of 1,700 jobs.

Some of the skills Ineos requires will be transferable from Ford, the company said.

It is not known how much public funding Ineos will receive, but it is planning to invest £600m in the new car, inspired by the original Land Rover Defender which went out of production in 2016.

Image caption The plant will be built on a new site at Brocastle in Bridgend

The new model is likely to face significant competition.

Last week at the Frankfurt Motor Show, Jaguar Land Rover launched their new version of the Defender, a modern car which has also been inspired by the original machine.

At peak production, it is hoped 25,000 vehicles a year will roll off the line at the new 250,000 sq ft (23,250 sq m) Bridgend site.

Key parts for the Ineos vehicle - including the body and chassis - will be built at a second factory in Portugal before being brought to Bridgend for assembly.

BMW will supply the engines, and engineering assistance will be provided by another German company, MBTech.

Ineos Group chairman Sir Jim Ratcliffe said it had seen "lots of good options to choose from" for a manufacturing facility.

Who is Sir Jim Ratcliffe?

Image copyright Ineos Automotive Image caption Sir Jim Ratcliffe says the car aims to be the "spiritual successor" to the Land Rover Defender (pictured)

Grew up on council estate in Manchester

Made his wealth after founding Ineos petrochemical company in 1998

The richest man in UK, worth an estimated £21bn

Supported Leave in the EU referendum and backed Theresa May's withdrawal deal

Owns a Tour de France winning pro cycle team, a French football club and now builds vehicles

"The decision to build in the UK is a significant expression of confidence in British manufacturing," he said.

The Welsh Economy Minister Ken Skates said their work to support Bridgend in the run up to the closure of Ford would "not stop here".

"We will continue to do all we can to attract new business opportunities," he said.

Image copyright Reuters Image caption Ford opened in Bridgend in 1980 but is due to close the plant in 2020

The Welsh Government also said the company was in talks with two Wales-based component supply companies to support their work.

The UK government's competition funding was aimed at technologies for the motor industry's transition to zero-emission vehicles.

The Secretary of State for Wales Alun Cairns described the Ineos investment as a "welcome boost" and said they had been supporting the industry through their industrial strategy.

"There have been some significant automotive investments to Wales over the last few years, including at Aston Martin in St Athan and together with the Welsh Government we will continue to provide incentives for firms like Ineos to make Wales their home," he said.

Tom Crotty, a director of Ineos Group, told BBC Wales the Welsh Government's funding and general support was more significant than that received from the UK government - although Mr Cairns had been helpful, he added.

He would not be drawn on the exact level of Welsh Government funding, but said it was below the rumoured £13m. It was not the deciding factor he added, and the grant was linked to the creation of jobs.

"It's a great area with an industrial tradition, and... there's some really great skilled people and we're going to need up to 500 really skilled people," he said.

On Brexit, he emphasised the investment did not depend on a withdrawal deal being struck with the EU, but said the company had made no secret of supporting Theresa May's deal and a continued open market across Europe.

The plant is being constructed on a 14-acre (five hectare) plot of land it is buying at market value from the Welsh Government.

The Welsh Government said the new business area, Brocastle Business Park, next to the established Bridgend Industrial Estate, will be able to accommodate a further 500,000 sq ft (46,500 sq m) of space.

The closure of Ford Bridgend was one of a series of recent blows to the automotive industry in Wales, which included the closure of Schaeffler in Llanelli and job losses at Calsonic Kansei in the town.

Peter Hughes, Unite Wales regional secretary described the Ineos decision as "welcome news" but highlighted it was not enough on its own to mitigate the loss of the 1,700 Ford jobs.

"The Welsh Government must ensure that Ineos lives up to the standards of what we expect in Wales from socially responsible employers. It is imperative that the jobs being created are of the highest quality, well paid and unionised," he said.