Friday 26th September 2014

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

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The future of Lotus is a subject very close to the hearts of many PHers but recent news out of the old American bomber base at Hethel has been downheartening to say the least.

Gales has proper industry CV

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."

Gales has experience at PSA and Mercedes

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.

Further developments of Evora promised

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.

Evora could follow Exige with a Roadster

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.

Elise tub only 3kg heavier than Alfa 4C's; it's staying

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."

[MyCC]

Such a shame that there will not be a new Esprit, that car is surely very much in Lotus' DNA. Understand about the costs involved to build it though, but if they begged and borrowed as much as they could from Toyota, could it not be possible?

Regards,

MyCC.