What to Do with a Problem Like Lotus

We talk a lot about European automakers struggling to survive given the hard economic climate, but none of them has had as bad of a year as LotusLotusUnited Kingdom, 1952 > present68 models
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. The company imploded this year. 

It started early in the year with rumors that eventually proved to be true that parent company ProtonProtonMalaysia, 1983 > present9 models
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would be privatized. By spring, Lotus no longer had the safety blanket of government ownership that basically allowed it to do what it wanted. New owner DRB-HICOM looked at the books and fired CEO Dany Bahar either because of shady business practices or because it just did not like him.

Now under full DRB-HICOM control, Lotus has cancelled plans to introduce four new cars in the coming years and reduced it down to just one - the EspritLotus EspritUnited Kingdom, 2010 > present4 photos
, and even that is appearing questionable these days. The company has sold 818 cars through September of this year.

Even Lotus' motorsport success has only come this year when it leases its name out to third parties. Its engines for the IndyCar Series were so uncompetitive that the series threatened not to let the cars race in the Indy 500 due to safety reasons, and the company will not be supplying engines to the series next year. 

The Lotus Formula 1 Team has done well this season, and Kimi Raikkonen is in third place in the drivers' standings, but the team is actually owned and managed by Genii Capital. Lotus is just the team's title sponsor. 

Things are similar in prototype racing where LotusLola B12/80 COUPE LotusUnited Kingdom, 2012 > present8 photos
is the title sponsor for the Kodewa team from Germany in the LMP2 class. 

So what can be done to save the company?

Georg Kacher from Automobile magazine thinks that Lotus should merge with Aston MartinAston MartinUnited Kingdom, 1914 > present62 models
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to create a company that serves relatively inexpensive sports cars and expensive GTs at the same time. Plus, the idea would not violate DRB-HICOM's plan to keep Lotus in the UK. However, as one of the few independent luxury carmakers left, Aston Martin might not have the capital to make it work. 

However, there is another British company that is growing quickly that could also possibly purchase Lotus, if the price were right - CaterhamCaterhamUnited Kingdom, 1973 > present9 models
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. Bear with me a moment, I know Caterham basically exists because it bought the Lotus Seven rights in 1973. However, the company has been growing rapidly recently and is already working closely with RenaultRenaultFrance, 1898 > present189 models
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on the next AlpineAlpineFrance, 1955 > 199414 models
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. 

Caterham CEO Tony Fernandes appears wiling to spend money if the investment looks good, and Lotus certainly has more name recognition than Caterham. If Lotus is in as dire straits as it appears, Fernandes could buy it and merge the company with Caterham. He gets better name recognition to sell sports cars under, and Caterham gets Lotus's chassis and years of engineering experience. 

Lotus has risen from near death in the past, but this might be the last straw. Where do you think Lotus will be one year from now? 

Source: Automobile