Lotus Needs To Find An Owner That Will Take It Seriously
Could Geely be that owner? Only time will tellby Kirby Garlitos, on
If you look at Lotus on the surface, you’ll see a company that appears to be on stable ground. It’s never been an automaker that prides itself on the volume of vehicles it makes, but it has released its share of models, most of which have been universally praised for being some of the best handling sports cars in the segment. But if you dig deep enough, you’ll realize that the soil that Lotus’ foundation stands on isn’t as stable as you’d think.
Financial trouble. Mismanagement. Multiple bouts with near-bankruptcy. The list of ills run long within Lotus, and as news comes out that the automaker is reportedly on the verge of another ownership change, the question on whether Lotus can have a stable and supportive ownership group has never been as relevant as it is today.
Reports say that DRB-Hicom, one of Malaysia’s biggest conglomerates and the current owner of Lotus, is on the verge of selling the sports car brand to Chinese manufacturer Geely. Separately, Proton could also be in play with reported talks of the PSA Group gaining a controlling stake in the Malaysian auto brand.
Two potential deals are on the table, but for now, or at least in this space, we’re only going to talk about Lotus.
The issue here is the tenuous status Lotus has had for years despite producing some of the purest sports cars in the segment. It’s gone through numerous bankruptcy ordeals just to keep the company afloat. It’s also gone through numerous ownership changes, most recently in 2012 when its parent company, Proton, was fully acquired by DRB-Hicom. Now DRB-Hicom is reportedly looking to divest Lotus from Proton and sell it to Geely, a Chinese automaker that counts Volvo among its auto brands.
Oh, and let’s not forget about the many controversies the company has been embroiled in, most notably the ouster of CEO Dany Bahar in 2012 over allegations that he was misusing company funds for his own lavish expenses. The two parties eventually settled in 2014 after multiple lawsuits but the fiasco served as another stain in the company, whether it deserved it or not.
So what do we make of this reported sale of Lotus to Geely? According to multiple reports, the Chinese automaker is keen on taking on Lotus while the PSA Group, the parent firm of Peugeot, Citroen, and DS, would be taking over Proton, thus splitting the two brands that have been linked together since 1993 when Proton acquired Lotus. Negotiations are still ongoing, but if it does happen, Lotus could find itself with another new owner. Hopefully, Geely has serious plans to turn Lotus around and bring some stability back to the company.
It’s a crying shame that the once proud British automaker has never had an ideal ownership situation for close to three decades now, but with a new ownership group reportedly on the horizon, there’s at least hope of seeing brighter days ahead for the sports car brand.
Continue after the jump to read the full story.
Let’s hope for the best, shall we?
It’s hard to imagine that the same cars that have given Jeremy Clarkson fits of glee are the same ones owned by a company that’s long been mired in financial struggles. I mean, take a watch at how Jezza feels about Lotus’ cars in the videos below.
The fact that one of the world’s purest sports cars hasn’t had a stable ownership foundation for years is one of the industry’s most under-the-radar mysteries. Sure, it found some modest stability when DRB-Hicom purchased Proton in 2012, but if these reports end up being true, we may have overvalued that “stability.”
My point here isn’t so much about lamenting on the company’s jagged history or complaining about all the opportunities it has missed to establish itself as a more legitimate sports car outfit. I’m looking into the future now to see what it has in store for Lotus and my hopes for strong support from its new owner, whoever it ends up being.
Apparently, that new owner could be Geely, who we all know is the owner of Volvo. It also owns the London Taxi Company so if ever you end up in London and ride one of those black cabs, you’ll know that Geely owns them.
On the bright side, it’s important to give credit where it’s due. Geely, despite initial skepticism of its capacity to own a brand as storied as Volvo, has done an incredible job in bringing life back to the Swedish automaker. Actually, it’s done more than that if you think about where Volvo was when it was owned by Ford to where it is now. It’s completely transformed into a legitimate luxury brand and while it may not still be on the same level as it once was during its ultimate peak in the 1980’s and 1990’s, it’s turned into a luxury brand to be reckoned with. Geely deserves a lot of credit for that.
Now, can it do the same for Lotus if it does end up buying it? I’m holding my reservations on making any judgments at this point because it’s hard to compare a luxury brand that caters to a volume-based strategy to a sports car brand that has never been about selling the most number of models compared to its rivals.
That’s not to say that Lotus can’t reach that point because it actually tried that approach earlier this decade with a full lineup of concepts that it planned to turn into a family of production of models. Then its former CEO and the driving force behind that strategy got canned and those plans went away faster than it takes the Hennessey Venom GT – a Lotus Elise underneath, mind you – to go from 0 to 60 mph.
There have been no indications yet on what Geely might do if it ends up acquiring Lotus but from a financial standpoint, it’s going to be a good new home for the British sports car brand, not only because it finally frees itself from the struggles of its old parent firm, but more importantly, it’s going to breathe new life into the brand with a new parent company that has shown over the past few years with Volvo that it has the capacity and the fortitude to bring some sparkle back to a struggling automaker.
I’m hopeful for Lotus, as I’m sure most people are.