Lotus looks to China to expand its brand

BRITISH sportscar-maker Lotus is set to expand into the huge Chinese automotive market, via a company spurned by its parent Proton in 2010.

Chinese industrial giant Goldstar, Malaysian car-maker Proton and Lotus signed a three-way joint-venture deal that will see Lotus establish a manufacturing and research and development facility in the Quanzhou, Fujian province, thanks in part to Chinese government incentives.

Proton and Goldstar’s previous deal for the company to build Proton-branded cars for the Chinese market ended acrimoniously in 2010, when Proton partnered with another Chinese industrial concern, Youngman. That deal expired in 2012.

Proton is owned by DRB-Hicom, who purchased the struggling car-maker – along with Lotus – from the Malaysian government in 2012. DRB-Hicom manufactures a range of vehicles in Malaysia under licence for the domestic market.

Proton CEO, Dato’ Abdul Harith Abdullah, said “The JV Agreement will see the establishment of a new JV Company for the purpose of undertaking research and development (R&D) activities in the use of efficient and advanced technology.

The JV Company will then produce and sell Lotus-branded passenger cars as well as provide after sales services in connection with its products in the People’s Republic of China.”

Lotus’s long-held Hethel factory in the United Kingdom will continue to turn out its trio of aluminium-tubbed two-door sportscars – Elise, Exige and Evora – leading to speculation that the Chinese facility will be used to build more mainstream vehicles such as future SUVs and sedans for local and overseas markets.

Sourcing parts from its own facility in China could also result in improved economies of scale for the UK outfit. The plant will have the capability to produce components, engines and complete vehicles.

Lotus sold 1950 cars in 2014, with just 80 dropping into China’s 26 million-strong car market.

“China has appeared to be the top key growth market for Lotus exports and is expected to grow at a very fast rate,” Lotus CEO Jean-Marc Gales said in the statement. “Lotus Group is excited about the opportunities of this new joint venture."Mr Gales is a former president of Peugeot-Citroen, and is currently overseeing a revitalisation of the iconic UK brand, with sales already up 55 per cent for the 204/15 financial year.