When you mentioned Lotus and able to connect with its brand, I guess people will call you uncle when you go to a wet market. The famous car was featured in James Bond, the spy who loved me. Well that was released in 1977. Now you know what I mean.
To be in supercar business is tough. Really tough but a few succeeded after executing some very bold plans and the period of prosperity was in their favor.
As noted, the 2014 Lotus Esprit is part of a daring turnaround-and-growth plan that aims to emulate the recent success of Aston Martin, Ferrari, Lamborghini, and Maserati. Not so long ago, those four brands were small-scale money-losers as Lotus is today, and they prospered only because they came under the wings of mass-market automakers that were willing to lay down big bucks for improved products and production methods that each brand needed to achieve higher sales and solid profitability. Ford Motor Company turned Aston Martin around over a decade of ownership. Lamborghini went through several owners and financial crises before finding refuge at the Audi division of giant Volkswagen Group. Ferrari and Maserati have long been the crown jewels of Italy’s Fiat, which has committed to resuscitating long-troubled Chrysler.
We’ve mentioned that Lotus has its own deep-pockets protector, Malaysia’s Proton Holdings, which has promised over $1.2 billion to fund the British’s automaker’s expansion. But however impressive that sum may seem, $1.2 billion doesn’t go very far in the car business these days, and Proton has already invested untold millions to keep Lotus alive over the past 15 years. That means the bosses in Kuala Lampur will expect their “English Patient” to pay back this latest investment, and the sooner, the better--or else. But as many analysts have already opined, the odds of success are quite long, considering the still-fragile state of the global economic recovery and the fact that Lotus will be taking on much-stronger brands in a premium-price market where it has no experience. As Autocar’s Steve Cropley observed, “Lotus has been selling [far less expensive] cars and it hasn’t found enough customers for those. Its factories and people aren’t used to making high-value cars...and its [very few] dealers aren’t used to selling them…[T]his is one case where hopes and expectations are separate.”
For his part, CEO Dany Behar is confident, as he told Cropley, that Lotus can successfully grow itself “from a niche sports car company to a builder of a range of premium sports cars...We have the opportunity to change everything--to do things from a better position--and that’s what we’re going to do.” He terms Proton not only a “strong” financial backer but “fun to work with,” and claims a good many people “believe we can do this thing just as passionately as I do.” And he insists the plan is pragmatic and do-able. For example, “we’ll outsource things that aren’t our specialty--just like every other modern manufacturer does. That, and clever design, will help a lot with the quality thing.”
OK, fine. But the devil is in the details, and Lotus’ turnaround plan could be derailed before it reaches the station by factors beyond the company’s control. Or maybe not. For now, then, the only “buying advice” we can give is to stay tuned for further developments and, if you’re inclined, think good thoughts for Mr. Behar and company.
The original strategy of Lotus was to build a supercar competing against Ferrari, Lamboghini and Aston Martin at much cheaper price. I begin to see some advertisments when I was traveling in China. And the Chinese are crazy about owning some exotic cars. If they want to be sucessful, this is the sweet spot. If you miss it, that's it -- gulung tikar.
Let's look at the line up.
1. New Espirit
Launching year 2013.
Engine: Lexus-sourced V8/V10. 500 hp
Price: $ 110 k pounds
2. New Elan
Launching year: 2013
Engine: Evora's V6, 400 hp
Price : $ 75 k pounds
3. New Elite
Launching year: 2014
Engine : Lexus 2+2 V8, 500 hp
Price : ??
Launching year: 2015
Engine: 5 litre V8, Lexus LS600h. 500 hp?
Price: $ 120 k pounds
5. New Elise
Launching year: 2015
Engine: Toyota 2.0 litre, 4 cylinders. 300 hp
Price: $ 40 k pounds
Looks like pretty much a complete line up here to target at Ferrari, Lamboghini, Aston Martin, Porsche, Japanese sport cars, etc. The man behind it seems to be from the right background. They also managed to attract some people from top supercar that willing to accept at much lower salary because of a sense of mission to rebel against establishment. The plan seems to be gutsy enough -- do or die kind of mission.
One question remains though, will it drain Proton resources? Proton bosses denied that(go to this link http://www.bernama.com/bernama//v5/newsbusiness.php?id=549201) but foreign media said Lotus CEO said that they have at least 1.2 billion Proton backing over a period of 5years.
I was a little bit confused with Proton strategy here:
1. Are there any synergies or transferable technology to Proton? The platform and target market are so different. If you put in those great Lotus tuned handling and high end engine, can they sell at lower price? In other words, mass market and niche market are like water and oil --- can never mix well one.
2. Will Lotus success boost Proton sales? Ferrari success did not boost Fiat sales, why should there be an exception in this case?
3. Assuming Lotus is successful in their turnaround plan, should they just congratulate themselves and collect dividend? I am damn sure if that is the objective we have better options.
4. Is Proton chasing after their own shadow? They want other people's technology, they want regional expansion and the same time they want to be the boss and they want to retain their control. Where can like than one!
5. Will Proton has any multiplier effects on Malaysian economy? Seriously?
As a consumer and a tax payer, I am not happy at all. Good night.