McLaren bets $675m on UK manufacturing, first SUV

McLaren is betting $675 million on British manufacturing, new models and its first-ever SUV as the luxury sports-car maker seeks to increase sales and close the profit gap with Ferrari.

The British supercar maker said the £500 million investment will expand its UK manufacturing and engineering operations. The plan includes a new assembly plant and the development and production of its own engines and transmissions.

McLaren said the investment is expected to create 1,000 direct and indirect jobs by 2032.

McLaren Expands UK Manufacturing

The investment comes after a major restructuring of McLaren’s business last year following its acquisition by Abu Dhabi’s CYVN Holdings.

The company’s main shareholder is now Abu Dhabi’s sovereign wealth fund L’IMAD, which has committed to investing £1.5 billion in McLaren over the next five years.

McLaren also changed how it manages production. Last year, it reduced dealer stocks by cutting one of two production shifts at its Woking assembly plant. It has since moved to producing cars only when customers place orders, a strategy aimed at avoiding discounts and protecting vehicle residual values.

That restructuring came as sales fell to about 2,000 cars in 2025, from just under 3,300 in 2024.

The company now wants to expand its model range.

McLaren Prepares First Luxury SUV

At the center of that strategy is a new performance SUV, which will be McLaren’s first vehicle in the segment.

McLaren CEO Nick Collins said the SUV would remain closely tied to the brand’s identity.

“We’ll do it very much in a McLaren way,” Collins told Reuters. “It will bring something unique to the segment, which we think the customers will value.”

The move follows a broader shift among luxury car manufacturers toward high-performance SUVs.

Lamborghini’s Urus has supported the brand’s sales growth since its launch in 2018, while Bentley’s Bentayga is its top-selling model. Ferrari has also entered the market with its roughly €450,000 Purosangue, although production is limited to preserve exclusivity.

McLaren Chief Operating Officer Michael Straughan said the company needs growth to reduce material costs and improve profitability.

“The way to get there was through expanding our product portfolio starting with the SUV,” he said.

McLaren Targets Ferrari-Level Profit Margins

McLaren has been loss-making for years, but Straughan said the company believes its margins can eventually reach the level of the segment’s strongest performers.

“We can equal the best, but we’ve got a long way to go,” he said.

That ambition puts profitability at the heart of McLaren’s expansion. The company wants more products and greater scale while continuing to position itself as a premium supercar manufacturer.

The strategy also differs from some competitors on electric vehicles.

While Ferrari has launched a fully electric model, McLaren says it currently sees no customer demand for an EV.

“We will do an electric vehicle when our customers ask us for one,” Collins said. “And they’re not asking.”

For McLaren, the next stage of growth will therefore center on expanding its product range, increasing UK manufacturing capacity and using the SUV to reach more customers without moving away from its performance-car identity.

Read also: Jay Leno turns down $20m offer for McLaren F1, says passion matters more than profit