Uncertain Times

[simpo555]

My French friend has cancelled his order for his exige after more than 18 months and still no signs of a car. In addition, on the French news its announced that Lotus is in the courts and likely to stop trading soon. Rumours abound that the company has no money, can't pay suppliers. If all this is true what happens next. My friend has a valid point saying nobody trusts the company now in France so sales and resales will suffer as a consequence. Who will want to buy even a second hand car if Lotus goes down the pan. Fair enough, Lotus only 'assemble' parts so parts availability shouldn't be a problem even in the future. However, regardless of this most people, as we've seen with Rover and Saab, rightly or wrongly avoid these cars like the plague and values plummet. I hope I'm wrong and that the news is distorted. However, if all this is true, everything that makes Lotus ownership relatively inexpensive will just explode. Low depreciation and 'cheap parts' and most of all confidence in the brand will just be a thing in the past. Hope I'm wrong but its probably not a good time from a financial point of view to buy any sort of Lotus.

[kambites]

Not many of the parts are made by Lotus anyway so I don't see why it would affect parts supply much (with the exception of things like clam shells and lights). It's hard to say whether the company going under would have a negative or positive effect on residuals. On the one hand, it'll put off some of the more "mainstream" buyers, but on the other it will eradicate the supply of new cars coming into the market to trickle down to the enthusiasts.

To be honest, if it were to happen I don't think it would make a significant difference to the cost of ownership either way.


As I understand the situation, some of Lotus' suppliers (who Lotus have not paid) have applied through the courts to have Lotus liquidated to pay their debts. That doesn't mean it'll happen, it's just the first step in a legal process for the suppliers to get their money.

Edited by kambites on Wednesday 3rd April 08:26

[BibsTLF]

The supplier in question was their old GP2 race team. Makes nick all difference to the supply of parts for the production line.

[Frimley111R]

Just to add, there's a new Lotus dealer in the UK which put off becoming one last year due to the uncertainty over the company's future. They have since met with senior management at Lotus and have been reassured that the future is safe and as a result they are opening a Lotus dealership. Additionally there was similar new in the Uk recently but this was an old invoice that had already been paid.

I also noticed quite a few vacancies on the Lotus Cars LinkedIn page indicating that they are actively investing and recruiting.

I can only surmise why the V6 is delayed but suspect that, compared to what they have seen in terms of the way larger car companies operate, Lotus was miles behind and they are now having to almost introduce a completely new way of working. This has happened with many companies in the past on a much larger scale.

The company's biggest failing is in its communication of what's going and because of this people often jump to the wrong conclusions.

[CTE]

DRB Hicom who own Lotus have enough money, but they have a very different cultural way of doing things...i.e. they do not entirely understand the western trading systems like paying your invoices on time etc. Also not sure if the guy in charge has a handle on anything much so may be struggling to justify expenditure to his bosses etc etc. For instance he thinks that the staff have benefited from the huge salaries awarded to certain "new" staff under the Baha`s rule and subsequently thinks they should all work for free. The staff other than the selected few have not had a pay rise for at least 3 years...one example of gross incompetence at the very top...he is also reported to have said, "once you were kings, but now we are"!!, may be some truth in it but never the less.... On the positive side they have paid a lot of invoices recently and say they have always made a success of any company they have bought....either they will learn and get it right over the next few years, or ideally sell to someone who knows what they are doing...if anyone wants to buy that is. I think that if they are allowed to go bump, then then they will be an attractive buy, but not with the debts they have at present....that is trading losses as opposed to unpaid invoices. In the overall scheme of things for DRB Hicom, Lotus is a minow and is little more than a shed somewhere on the side of Proton.