Creation of dependency reduced POM fails for project with uninstalled local parent using Maven 3

When running the Shade Plugin with Maven 3, the plugin will fail to create the dependency reduced POM if the POM inherits from a parent that is not installed to the local repo but only available from the project checkout via <relativePath> and that parent is not part of the reactor build. The problem being that the plugin creates the dependency reduced POM in the target directory, thereby changing the base directory when it calls the project builder. This only works in Maven 2.x because of internal project caches which are not present in this form in 3.x