Government approves £10 million cash injection into the future of Group Lotus

The future of Group Lotus is looking more upbeat after it was revealed the Norfolk firm is to get an estimated £10 million cash injection from the government’s regional growth fund (RGF).

Business secretary Vince Cable revealed the news to the Eastern Daily Press. He told the paper: “We have now agreed the regional growth fund for Lotus. It was a few weeks ago that we finally signed off on it. There is a lot of detail still to grind through, but we have basically approved the bid.”

Group Lotus is not officially commenting on Cable’s revelation. Autocar sources have revealed the fresh application was submitted some weeks ago and has now been agreed in principle, with only due diligence left to complete, as Cable alluded to.

Under former boss Dany Bahar, Lotus submitted an application to get £10m from the RGF two and a half years ago. This was to fund development of five new cars, a plan that’s been put on ice following Bahar’s exit last year.

The application for the RGF was put on hold and has now been reprised under Lotus’s new management team, headed by Aslam Farikullah. The amount of money is understood to be similar to the original £10m, although sources remain coy on an exact figure and what it would be used for. This is to avoid any speculation about a new ‘plan’ for Lotus following the failure of Bahar’s proposals.

The RGF is designed for new jobs and training, and for R&D projects, suggesting Lotus still plans to expand its line-up.

Cable revealed that the government’s investments of around £1 billion from the RGF have led to around £6bn of investment from the private sector, with the car industry a particular beneficiary. 

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13 May 2013

Good news indeed for Group Lotus; they may now have the funds to finally get the new Esprit into production. If they are sparing with the cash, they might even have enough to further develop their existing range.

13 May 2013

Good news......shame for a great name to go under. I wish VW could do something with it and inject some serious cash.....

13 May 2013

Many people said at the time of Bahar's plan they were completely unrealistic.   Developing one car is a huge engineering challenge; doing that five times over only something the bigger manufactures could consider.

 

It would be better for Lotus to concentrate on one model, and make it a very focused product.   Aim for excellence in handling.   The engine, while it can be based upon another, it has to be cutting edge.   But the build quality has to be not just excellent but perfect.   They need to out Porsche Porsche.

 

If Lotus does this they'll have a future.   Car buyer's expectations have moved on significantly since the original Elise was released, and Lotus's products haven't.

 

13 May 2013

I don't want to be the party pooper here, but £10m won't make any difference whatsoever. The Bahar plan was always pie in the sky, 4 or 5 new models from their limited resources probably sounded realistic in the pub, but nowhere else. Hopefully, this £10m will be spent in the consulting business, where Lotus actually do quite well. For proper car development Lotus needs a few hundred million to a billion from their parent company, otherwise they'll continue to build cars that handle better on the back of a low loader.

13 May 2013

Aren't these governemental cash infusions usually the death knell for the automotive companies concerned? Lotus has a great history and deserves a place in the market with what they do best: light vehicles giving spirited performance, They have to find a niche in the market and exploit it. The other question is: can they do anything productive with the 10millio?

GeToD

 

13 May 2013

Good news to some extent. Would've liked to have seen the Esprit, Elan, Eterne and Elite concept car designs revealed a few years back go into production. But £10m really isn't enough. Here's to hoping though.

13 May 2013

Agreed AutoConception, although welcome, I wouldn't have thought £10m will even touch the sides in terms of the funding Lotus must really need to secure it's future.

Reading Steve Cropley's column this week I couldn't help wishing that Bahar was still at the helm and his plan had come to fruition.  Although many were sceptical about the size of plan (me included) I can't help thinking that Lotus desperately needs someone with a grand plan and the drive to make it happen.

Without it, it must be only a matter of time before Lotus goes the same way as Saab?  And a world of cars without Lotus just wouldn't be as exciting any more.

13 May 2013

Amble;

Much of what you write is true,however,in my opinion, Bahar, was a fool,to carry

out his plan Lotus needed some thing like 800 million pounds,it was not there and

never will be.

At the end of the day Lotus is a very small car company who sell very few cars,that in

my opinion will always be the case.

They should understand that and run the company with that in mind,if they do not 

know how all they have to do is ring Charles Morgan,i am sure he would give them a

few tips.

I do not hold much faith in the people who run Lotus doing this,in fact i think in 3-5 years

Lotus will be nothing more than history  !!!!!!!!!!!.  

13 May 2013

The problems at Lotus did not begin and end with Dany Bahar. But he burned through a lot of cash with little except pipe dreams to show for it. I hope he enjoyed the parties with Naomi Campbell et al.

In hindsight it is clear that the Evora was the wrong choice, and that was Mike Kimberley's fault. Lotus should have undertaken an honest assessment of their strengths and weaknesses and gone from there.

The much-vaunted platform is too cramped and the build quality too iffy for Lotus to hack it in the premium coupe market.

Had the Evora been a slinkier two seater, launched with the SC engine and called Esprit, it could have been pitched as a bargain mid-engined supercar rather than a straight rival for the 911.

13 May 2013

Lotus would seem on the one hand, to be an excellent engineering company capable of producing cars with class leading performance, ride and handling, but on the other hand, in an unenviable position with insufficient credability where the majority of potential customers would not invest their hard-earned £ on a Lotus car, but instead prefer to play safe on a Porsche, Merc, BMW or other mainstream brand (which I accept is not necessarily in direct competition with the Lotus alternative).

Rather than attempt to bridge the perilous divide that is their current market, ie track focused high performance car which can be used on the road, which seems to produce cars costing many £, but for which there must be a tiny market, perhaps a change of direction should be considered?

Could Lotus become the performance and engineering arm of some reputable brand eg Alfa, where the partner brand can command the £? Could Lotus go back to producing small, accessible, fun, lightweight cars for the masses such as the original Elan, where a customer is perhaps investing £20K rather than £40K?

Is this £10M the government's way of trying to hoodwink the foreign owners that this is a company worth investing in?

 

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