Friday 6th July 2012

Lotus: Dead weight lifted or dead man walking?

We investigate whether Lotus is back on track in the post-Bahar era

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FoS sculpture was well received

On the face of it, life seems to be looking up for Lotus after the sacking of boss Dany Bahar at the beginning of June.

Evora hybrid seems promising

The list of recent positives is long, starting with an excellent showing at Goodwood. Lotus was the featured marque and put in a mighty effort to impress the punters. The sculpture was lauded as one of the best in recent memory and the display of golden oldie race machinery up the hill impressive. The wonderfully bizarre door-stop Type 58 racer from 1968 stuck in the mind.

Then the company this week opened the doors on its flagship Regent St merchandising store in London. A £333 car coat might not be high on your shopping list, but the kit is mainly stylish and the shop well appointed. Let's not forget that Ferrari makes around a quarter of its profit from its stores.

The racing is going great guns, meanwhile. It might be mostly in name only, but when the Lotus F1 team is now regularly making the podium and currently sits third in the championship ahead of Ferrari, it's got to have a positive effect on the global perception of the company.

Racing heritage isn't translating into sales

Lotus Engineering, a mostly separate entity to Lotus Cars, is also still deep-thinking its way to solutions to benefit both Lotus and its worldwide customers, most recently reaching the track testing phase for the Evora plug-in hybrid.

This is the car that's promised to accelerate faster to 60mph than the much-praised supercharged S but record just 55g/km of CO2 (around 120mpg).

So all this must be having a terrific effect on sales, right? Er no. Up to the end of June this year, Lotus had sold just 82 cars in the UK. That's down from 218 the year before, a fall of over 200 per cent. Even Saab sold more than that, and it's been defunct since December.

So what's the problem? We put that question to Lotus, who then sent it all the way to new owners DRB-Hicom in Malaysia, who declined to comment.

...but new branded store could help coffers

Given that Lotus would usually answer this themselves, it demonstrates just how much DRB-Hicom want to take control of the day-to-day stuff. Understandable when all the publicity outlay for expensive hobbies like racing hasn't translated into sales, and in fact seems to have done the opposite.

Let's hope the Evora convertible, expected to be revealed in a month or so, can go some way to halting the decline.

[FactoryRSVR]

Maybe this also shows that years of motoring journos saying their products are great equally doesn't translate into sales. It would seem that car customers are smarter than the people that write about them.

[MogulBoy]

A fall of 62.38% to be precise.

[SWoll]

FactoryRSVR said:

Maybe this also shows that years of motoring journos saying their products are great equally doesn't translate into sales. It would seem that car customers are smarter than the people that write about them.

Smarter?

[kambites]

I find it very hard to see Lotus Cars surviving.

[Kamox]

Danny Bahar declared in an interview to Evo (19th April 2012):
"We have 1162 orders to fill [189 Elise, 156 Elise S, 350 Exige S, 182 Evora and 250 Evora GTE models] - which is incredible."
So? Are they producing those cars he was taking about?

[slipstream 1985]

as i have said before do an elan for the masses. front wheel drive high spec aiming at the audi a1/tt mini catagory.

[kambites]

slipstream 1985 said:

as i have said before do an elan for the masses. front wheel drive high spec aiming at the audi a1/tt mini catagory.

It would either be 20% more expensive than its competition or a worse car.

Anyway, how is that "an Elan"? The (original) Elan was probably roughly on a par with the current Exige S, price-wise.

[Ecosseven]

That’s quite a drop in sales compared with last year. Perhaps the recession really is biting hard?

[hornbaek]

Lotus is a mystery to me. Admittedly the decisions to headline Goodwood and the opening of a Picadilly Concept Store were taken long time ago but for a company that is allegedly in a dire financial state it resembles hara-kiri. Only journalists believe that a 3000 feet concept store in one of the most expensive UK / The World retail spaces will ever make money. This is marketing expenditure not income.

[Fittster]

slipstream 1985 said:

as i have said before do an elan for the masses. front wheel drive high spec aiming at the audi a1/tt mini catagory.

Yeah, because it worked so well last time.

[TVRinBFG]

"Lotus had sold just 82 cars in the UK"

Is that sales, or cars registered? If it's cars registered, that 82 includes dealer demos and Lotus senior factory staff cars, so the actual figure is even worse.

[slipstream 1985]

Fittster said:

slipstream 1985 said:

as i have said before do an elan for the masses. front wheel drive high spec aiming at the audi a1/tt mini catagory.

Yeah, because it worked so well last time.

last time the premium small car market didnt exist and i am led to believe it is quite a profitable one.

[kambites]

Kamox said:

Danny Bahar declared in an interview to Evo (19th April 2012):
"We have 1162 orders to fill [189 Elise, 156 Elise S, 350 Exige S, 182 Evora and 250 Evora GTE models] - which is incredible."
So? Are they producing those cars he was taking about?

They do sell cars outside the UK (no idea how many, though).

[Bill]

SWoll said:

FactoryRSVR said:

Maybe this also shows that years of motoring journos saying their products are great equally doesn't translate into sales. It would seem that car customers are smarter than the people that write about them.

Smarter?

Odd choice of adjective.

I am amazed and dismayed by the sales figure of 82

[Captain Muppet]

Ecosseven said:

That’s quite a drop in sales compared with last year. Perhaps the recession really is biting hard?

I read on Pistonheads that the production line stopped during the takeover. No cars = no sales.

[car95]

How many cars sold globally?

Without that information the UK figure is useless. With that information, the UK figure may be irrelevant.

[nsmith1180]

The big question is if they can keep the company going until they start to deliver the new models. If they are as good as they look, and half as good as the hype, it may save the company. If not, we will be down another UK motor manufacturer.

[Lyons]

slipstream 1985 said:

as i have said before do an elan for the masses. front wheel drive high spec aiming at the audi a1/tt mini catagory.

They did that before: http://en.wikipedia.org/wiki/Lotus_Elan#1990s_Elan Didn't work out...

Unfortunately, unless DRB-Hicom push though with Bahar's strategy, I think lotus have no chance. Porsche have the volume sports car market sewn up with higher quality products. Ferrari and Mclaren have moved the super car game on. All lotus have is a 16 year old low volume sports car platform, and a the Evora, that no one seems to like that much.

Virtually zero sales and money coming in, a big bill to swallow to get a decent product to market, and no guarantee regaining that investment when the product is on the market. If it was me, I'd cut my losses. Sincerely hope that DRB-Hicom don't...

[f1ten]

i just dont get it, why the sales are so low?
Lotus hard followers wont like me for saying it but the Evora is over priced is my best guess? Although given the low fuel consumption and tough economic times surely the Elise should still be selling?!

[toppstuff]

The business is in transition.

It will survive IMO, but the forensic examination and constant attention being taken by the media must be making the owners very uncomfortable. I doubt they are used the media attention and I bet they don't like it.

There are loss making car companies everywhere. Plenty of them obfuscate and fudge the state of their finances. But Lotus seems to exist under a spotlight these days.

What will happen?

The value of the brand ( especially given its F1 success ) is still considerable. That should give the owners comfort.

The convertible Evora can't come too soon. I'm betting it will be a success in overseas markets and so gradually ( hopefully ) Lotus will pick itself up.

But the management need to get their act together and show strong leadership. If not, then the value of the brand will peak and fade and their moment will have been lost.

As for the Evora plug in hybrid - I actually think it is an excellent idea. Lotus Engineering need to showcase their expertise and cars like the plug in Evora do just that. It's much more interesting than a Tesla !