Lotus boss Jean-Marc Gales: PH Meets
Amid yet more turbulence the new head man at Lotus tells PH how he plans to turn things round
In the latest bombshell, the company last week said it would have to shed up to a quarter of its 1,215-strong workforce in a bid to cut costs. Clearly it was time to find out what was going on, so we arranged an interview with the new CEO, Jean-Marc Gales, to hear how bad things really were. We know from the most recent company reports that Lotus Cars and the attached Lotus Engineering consultancy lost £159 million in the year to the end of March 2013 and £115 million in the year before that. Bleeding cash basically.
So Gales (pronounced Ga-les) had his work cut from the moment he started in May, but if anyone can sort out the mess then this guy can. Compared with former CEO Dany Bahar's narrow marketing background, Luxembourg-born Gales has the complete auto-exec CV, ranging from engineering roles to heavyweight jobs such as head of global sales for Mercedes and head of brands for PSA Peugeot Citroen.
During our 40-minute interview he (mostly) didn't beat about the bush. "The fact is we need to reduce our costs and we need to sell more cars," he tells PH. Those cars in the medium term to continue to be current Elise, Exige and Evora or variants of them. Forget Bahar's very pretty array of concepts, they're toast. Even the Esprit.
"Nothing survived from them," he says. Quite apart from the cost of developing them for production, they didn't fit with the Lotus ethos. "If you look at [the core Lotus values of] dynamic excellence and lightweight efficiency, this clearly excludes the five former concepts that we showed four years ago in Paris."
That includes the promised V8 engine. "If you look our size, our structure, our past, we are not a company that can afford to build our own engines," he says. Instead, he says Lotus will continue to modify Toyota engines, just as Colin Chapman modified the Ford unit to create the twin-cam engine used many early Lotus cars.
Gales referred to Colin Chapman a lot in the interview, which bodes well. Gales and his management team analysed what made a Lotus a Lotus, and quickly figured out that Chapman's formula is still highly relevant today. "We decided it's the purity of Lotus that is the most important thing. It is what you feel when you get into the Exige. That's when we decided to got back to the old Chapman philosophy that lighter and simpler is better. All our new products will reflect this," he says. And yes, he can envisage making something besides sports cars in the future. "These values can attached to any segment you can imagine."
Except right now he can't afford to build anything brand new. We all might argue that a range built on a bonded aluminium platform that can trace its roots back to the Elise's launch in 1996 is outmoded, but he strongly and persuasively argues that the three cars are still highly relevant today. "The current range have clearly got a lot of life left in them," he says.
The three are still the dynamic benchmark in their segments (feel free to argue), but Gales believes that the method of construction with everything attached to the central 'tub' is still bang up to date, even compared to carbon fibre versions. "Our tub on the Elise weighs 68kg. The carbon fibre tub on the Alfa 4C weighs 65kg. In the 17 years since Elise was launched, they've only saved three kilos."
He will continue to improve the current cars, promising model enhancements to make them lighter, faster, more dynamic and more economical. He reckons the tub can be altered to make them easier to climb in and out of, and he's looking at rolling out a "comfort pack" to make the Elise and Exige more useable day-to-day, should the buyer want it.
And he's also addressing the lack of dealers, which he reckons was a big reason why sales have been so sluggish. "More dealers drive more sales. Our sales network basically did not provide enough coverage for our sales ambition. It's absolutely not the question of our product," he says. He reels out a whole list of European cities without a dealer, a list topped by London. By the March next year, he says he'll add up to 20 more.
Something must be working because sales are up. In the five months from the end for March, Lotus has sold 914 cars globally, meaning they're on course to beat the 1,232 total last year.
Amazingly he says the current best-seller is not the Elise, which starts at £30,900, but the ballsy 3.5-litre V6 Exige, a whole more expensive at £54,500. "It's the car that embodies most the DNA of Lotus," Gales says.
There will be new cars, but built on the current platform in the medium term. Expect an announcement within the next nine months. "They will shared with underpinnings with current cars, but they will drive like nothing else," he says. One possibility is an Evora convertible. "A convertible will certainly appeal to many buyers in the US. It would be lovely to have one and it is relatively easy to do - the roof is not a structural part," he says.
On that point, contrary to a recent story, Lotus is not pulling out of the US. It says it will not build a 2015 model year Evora while it works on a compliant car for 2016 with the right airbags.
We were impressed with Gales. As he should given his experience, he seems to have grasped what needed to be done and had the gumption to make the tough decisions for the good of the company.
It seems unfair he lacks the cash that Dany Bahar had, because we get the impression he'd have spent it wisely and true to Chapman's ethos. But just to deliver the company back to profitability, something he reckons can be done "in the very foreseeable future", would be enough to earn the praise of Lotus fans everywhere, certainly round these parts. Then he can build the next Elan and Esprit. We couldn't get a promise on that, but we liked this statement: "In the future, lets look into our heritage, because our heritage will define our future. We will go back to what makes Lotus great, building iconic sports cars."
Cut costs.
Better dealer network.
Convertible Evora.
Maintain DNA of lightness and simplicity.
Well it's certainly everything that everyone's been saying for ages, but it's not a simple task and he actually needs to go do it. A lot of people are cheering him on certainly, and he has the experience and clout by the sounds of it. Fingers crossed.
Unsurprised to hear that the Exige is now leading the way. It's an amazing thing and I want one.
EDIT: Oh, typo on the picture caption conflicting with the article text re. Exige/Evora leading sales? - Fixed now.
I've not actually seen a 'current model' Elise - the one with the 'Cars Movie' front end - and it's been around for over 2 years now?
I've seen one of the newer-look Exiges - the dealer demo - and kinda wished I hadn't. The front/rear restyle is - how can I say it - an acquired taste!?
I know, I know, it's the drive not the looks and toys - I'm with you - but no-one seems to be driving them and I don't see how you change that?
Lets face it, for someone who wants something sporting for say £35k, the world is your oyster, for every Elise, there's gonna be a hundred other options. Wind up to say £50k, and those other options are much more widely spread, it's not enough for a "proper" Porsche, too little for the really bonkers track toys (mono, Atom etc) so i'm unsurprised the Exige sells more tbh!
I've said it before, but, for the elise to survive as a relatively low powered car i think it's got to go "Eco", ie mild hybrid etc. Lotus are well aligned to take a chunk of that pie that currently the mainstream OEMs are too big and unwieldy to grab!
Not to make another would be foolish.
When they put a sunroof in the Evora they might consider redesigning it so it looks less odd.
If he is as foceful as he appears why the lack of money yet again? Clearly the very wealthy parent company cannot see that much potential in new investment. If Bahr and this bloke were running Lotus then I think they would really go places.
We live in hope.
sounds like a sensible guy, i think they need to try and push the lotus name onto other products, if they could hook up with car manufacturers that could use an image boost, a modern day sunbeam, cortina or carlton would help cement there name in the public imagination again.
a Lotus Velestor?
a Lotus Cee'd?
I mailed JMG the week he was appointed to congratulate him and express our hopes for the future. Didn't expect a reply but got a thank you note 20 mins later and a promise to stay in touch. I've exchanged a few more since and boy, does he get Lotus and the fan base. Can't say that of too many CEO's in the past (except CC and MJK of course)
BTW, I recall an EVO visit to Hetehl in the DB era. I'm sure Harry Metcalfe mentioned seeing a topless Evora. He certainly mentioned an Esprit Spider which was a 'wallet busting moment' for him there and then. A real shame it was canned.
he is dreaming.
the 1st issue in his role should be seeing the down sides of the cars he is trying to sell in todays market, not saying how great they are.
the Evora a benchmark ffs. it's a dinosaur and all he wants to do is cut the roof off.
the cars needs a new engine, needs to loose 100kg's and be 15k cheaper.
in 2014 they have sold 10 sports racers !!!!
cars will sell, you don't need dealers.
UK sales must be an all time low now.
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