In an official statement, Lotus said: "Williams Advanced Engineering has been a technical partner, bringing specific high voltage and battery development expertise to the Evija hypercar project.
"As the programme entered its latter stages pre the Covid lockdown, Lotus elected to bring the project in house due to delivery problems from Williams Advanced Engineering. Lotus will complete and enhance the programme in house as referred to in previous statements about our new Advanced Technical Centre in Warwickshire and the revised Evija production timetable.
"The end result will be a better product as we introduce not only the most powerful production car in the world, but also the world's best electric car for the drivers."
WAE claims Lotus’ decision is “wrongful and without any legal basis, made for Lotus/Geely’s unrelated commercial reasons”.
The engineering firm also claims that any allegations from Lotus that it breached the terms of the agreement, signed in January 2019, are “false and contrived”.
WAE is now taking legal action against Lotus on grounds of wrongful termination and will pursue compensation for invoices that are claimed to have gone unpaid since April 2020.
According to WAE, the decision puts a number of UK jobs at risk and jeopardises the launch of the Evija, which was recently delayed because testing could not take place during the pandemic.
WAE claimed the project is “now in its latter stages” and that it had “continued to perform outstanding work and progress the project despite the global impact of the Covid-19 pandemic”.
“WAE wishes to make clear that this issue has no impact on its existing projects, customers and partners,” it added.