There's very little real saving from using this existing factory, except maybe the construction of the shell and the utilities. The Smart factory will have to be completely rebuilt inside to accommodate the Grenadier (stupid name, btw), due to the different size and different construction. Take the paint shop, one of the most expensive parts of a car factory: one designed for Smart cars simply won't be big enough for this vehicle (part of the process of painting a car involves submerging the complete body shell into a bath of primer). Beyond that, the process of assembling a monocoque car (like a Smart) is completely different to that of a body-on-frame vehicle like this thing - the entire layout of the plant needs to change.
The saving isn't from the factory, but from what's in its neighbourhood. The French site is likely to have supplier factories next to it, as this simplifies the logistics of the main factory. After all, a steering wheel, seat, wiring loom or dashboard moulding is pretty much the same regardless of what car it's going into, and having those producers already set up will make it easier to get good pricing, especially as the suppliers have to take much less of a leap of faith. The Welsh option involved asking top suppliers to be paid in an increasingly volatile currency to set up a new factory behind a tariff-barrier in order to supply a small company which may not even deliver enough products to survive...