Automotive News Europe - December 2017 - Talk from the Top Supplement - 16

AUTOMOTIVE NEWS EUROPE

 

TALK FROM THE TOP

Expansion plans
Lotus CEO sees SUV coming with help from new stakeholder Geely

I

t has been a momentous year for Lotus.
Volvo Cars-owner Zhejiang Geely Holding bought a majority stake in the British
sports car maker, ending the uncertainty
over its future under former Malaysian
owner, DRB-Hicom. CEO Jean-Marc Gales,
who has spent the last three years fighting
to stabilize Lotus' weak finances, said of
the company's new Chinese owners: "It is
the best thing that could have happened to
us." He explained why he's confident that
Lotus is ready to enter the premium SUV
sector in an interview with Automotive
News Europe Correspondent Nick Gibbs.

Meet the boss
❚ N
 AME: Jean-Marc Gales
❚ T
 ITLE: Lotus Cars CEO
❚ AGE: 55
❚ M
 AIN CHALLENGE:

Expanding into SUVs
while keeping the
Lotus DNA intact.

Where does Geely want to take Lotus?
Lotus is a benchmark for handling, aerodynamics and lightweight. I'm fairly sure with
the Geely parts bin at our disposal, we can
design a Lotus crossover that has unique
lightweight features, aerodynamics and
handling that befits the Lotus brand.
What's driving your plan to expand
beyond sports cars?
We are not just tied to sports cars, which
is a fairly stable market worldwide. What
is growing at double-digits, however, is
the SUV market, especially the premium
SUV market.
Would the SUV platform use bonded
aluminum like your sports cars?
Why should it? Bonded aluminum for
sports cars is a great thing, and for the
coming years we will certainly stick with
that technology because we are masters
at it. On other segments we can have
steel, aluminum, composites or even
carbon fiber. The future's wide open.
Will Geely use your engineering arm?
Lotus Engineering has lots to give to our
shareholders as well. It's one of the reasons Geely bought us.
Lotus made a pre-tax profit in the
second half of its last financial year.
When will the company achieve fullyear profitability?
Next year is clearly the plan. The target
is to be cash-flow positive for this financial year. Lotus hasn't been cash-flow
positive for a couple of decades. One of
the reasons Geely bought us is because

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Lotus has also managed to survive in a
really tough automotive industry.
How have you improved cash flow
when sales have been flat?
Last year's sales were 1,500 and this
year they will stay about the same.
However, revenues are up 15 percent
because we're selling much higher-spec
cars. In each of our product lines, the car
with the highest horsepower is the bestseller. In addition, we are still reducing
costs. In our next financial year [which
starts April 1, 2018], we will enter the
Chinese market with the Evora 400.
Could the Esprit supercar come back?
I can't divulge any future plans, but in the
next six months we will announce some
future projects. I am convinced the Esprit is an extremely good brand name.
Has Geely given you a sum to spend
on developing new cars?
No sums are disclosed. We're working
on an exciting five-year plan with our new
shareholders. What you won't see us doing
is launching five new cars at a motor show.
Where will the new cars be made?
Our sports cars will stay in the UK, that's

clear. Lotus is quintessentially a UK brand
so we need that. If, in the future, we have
one or two plants for the potential crossover, they should be close to where the
destination market is. For SUVs, the biggest market in the world is China. That's
where Geely has plants. But, I don't exclude anything at the moment.
Besides SUVs, are there any other
segments Lotus could enter?
We're currently doing an analysis and
there might be more segments where
the Lotus DNA could be used. But for
crossovers I'm not just thinking of one
size, but a couple of sizes.
Do the SUVs have to be compact?
Lightweight doesn't mean small. It means
efficient. It means intelligent engineering.
It means using the right materials, with a
low center of gravity for the right handling.
We have ideas on how to achieve that.
Would it be hybrid? Electric?
There are trends leading toward electrification and all future Lotus cars will show
some form of electrification. Maybe the
sports cars will stick with combustion
engines. If it isn't lightweight, however,
we're not going to do it. ANE

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