Lotus in the post DB era

[NedaSay]

I agree with Thomas on this one. The UK market seems to be very different from the rest of the world. Here (in Switzerland) the Elise is a hard-core weekend toy that you have if you already have something for the rest of the time. I'm not sure the Atom has ever been legal here - Caterham have just lost the right to sell in Switzerland because of safety regulations. The advantage the Elise has over the open cars you mention is that at least you have some protection when you get caught out by an alpine storm.

A friend of mine lives in California and her primary car was an Elise, single, mid exec, no kids. Unfortunately she had an accident and the car was declared totaled. She switched to the competition. In California an Elise can be an everyday car provided you don't mind driving in traffic and not having power steering! The market needs may vary from one place to another. I agree with most Elise is not at heart a primary car but it wouldn't take much to make it so and it would not abusively change the car. Just get the Tesla roadster interior and see the difference!

Edited September 4, 2012 by NedaSay

[Guest surferphil]

Not sure I'd call it a success. Official figures here show that the Tesla outsold the Elise and Exige combined in the first half of this year, and my understanding is that the Tesla isn't in production.

As a comparison, Ferrari sold about 12x as many cars here as Lotus so far this year.

The Elise isn't an entry level car, it's a car chasing a tiny market which from what I can see is only getting smaller.

It's pointless twisting what I wrote off in your own way.

[mayevora]

http://blog.roadandtrack.com/?s=Lotus

[Kimbers]

Not sure I'd call it a success. Official figures here show that the Tesla outsold the Elise and Exige combined in the first half of this year, and my understanding is that the Tesla isn't in production.

As a comparison, Ferrari sold about 12x as many cars here as Lotus so far this year.

The Elise isn't an entry level car, it's a car chasing a tiny market which from what I can see is only getting smaller.

Sorry Andrew I agree with Phil. The new Exige isn't and wasn't out yet, Bahar had not continued MJK's and RB's plan to put a Euro 5 engine in to replace the 1.8! All you had in Jan this year was the off 1.6 Elise but don't forget, production was stopped at that time so what you quote is totally misleading.

The Elise has sold and would sell thousands of cars a year world wide because it is such a perfect 2nd car, weekend rocket and even daily ride (for younger people without back problems). It was frugal when driven carefully and can even be good on Co2 so low on Tax.

The whole basis of any car company is that they have everything from an entry level car upwards. Across every range, even Bentley, Ferrari etc (Lambo you could include the TT maybe as the entry level as they are owned by Audi), you have cheaper options to Owchy! Even your Fords of this world do it.

MJK's plan was simple. You offer a base model Elise Exige as cheap entry and introduction to the brand (£25-35k). It's such a great car you will love it and as you get older you buy an Evora (2+2 with very young children) £50-60k. Thats such a great car your kids grow up, you're 40+ have free income you buy the new Esprit £80-100k. If People are very successful he had a Supercar in the 5 year plan at £150k. There was even a couple of "Lotus......(other brand)" specials in there.

People pop in and out of other brands but the idea was to hook them into Lotus as a brand and to do that you need to be able to offer cars across all costs base's.

Unfortunately DB changed all that when he came in and MJK's (and RB's) plans never got past 2 years (and I would point out that they made profit and the new Esprit would have been out by now) so we will never see the outcome.

I wish we had though because I had and still have 100% in MJK's plan and model range. They were stunning and 100% Lotus, both designed and DNA.

[chandrew]

Anthony

I'm not disagreeing with the logic of an entry car, just suggesting that the Elise-type cars aren't doing the job. Yes, the production issues didn't help but sales have been tiny here for some time. The car is seen as a hard-core weekend toy and is discounted by most people I speak to because of this, even other sports-car buyers because it is too impractical. My dealer suggested that most are used as track cars or for sprint events.

I know Switzerland is a small market compared to the UK (though much stronger in terms of sales-per-population) but no other sports car manufacturer seems to have problems selling cars. The market is booming: the main VAG brands are running at over 20% year-on-year growth and MB at over 40%. The whole market has been growing at over 10% every year since 2009. Over the same period Lotus have been flat / declining

What I'm arguing is that the current Elise is seen as far too compromised for it to be a realistic proposition as a daily-car for anything other than a tiny market. I love mine but I was in the market for a X-bow / 2-11 / Caterham type car.

I love driving the Evora and here it's never had the pricing-issues that it has had in the UK (you'd pay less for one than a Cayman) but Ferrari sold more FFs here this year to date than the Evora has sold in total since 2009. The rear seats certainly don't work for me with my two <6 year old children and most here are sold as 2+0s according to one dealer I spoke to. As Thomas says, people in Europe aren't wanting a cheaper Evora, they're wanting a better one.

[TBD]

Anthony, I also have to disagree. To make money at the low end you have to build thousands of cars by robots and that was never Lotus. The great Lotus chassis isn't compatible with that kind of production, which is why Lotus will bever again earn money on an Elise. Its an enthusiasts car, as a perfect second car its missing all those amenities potential customers demand. Power steeering? Four or six airbags? carpets? Never been part of the Elise, but what is necessary to break out of the dwindling niche.

Does Ferrari have an entry-level car? The Audi TT an entry level Lambo? Your're kidding. Either you decide for mass production, for which Lotus is only lacking a few billion pounds, or you stick to being exclusive ad DB wanted.

MJK's ideas were great in his time, but they weren't successful at Lamborghini either. VW had to bail them out.

Edited September 5, 2012 by TBD

[NedaSay]

Sorry Andrew I agree with Phil. The new Exige isn't and wasn't out yet, Bahar had not continued MJK's and RB's plan to put a Euro 5 engine in to replace the 1.8! All you had in Jan this year was the off 1.6 Elise but don't forget, production was stopped at that time so what you quote is totally misleading.

The Elise has sold and would sell thousands of cars a year world wide because it is such a perfect 2nd car, weekend rocket and even daily ride (for younger people without back problems). It was frugal when driven carefully and can even be good on Co2 so low on Tax.

The whole basis of any car company is that they have everything from an entry level car upwards. Across every range, even Bentley, Ferrari etc (Lambo you could include the TT maybe as the entry level as they are owned by Audi), you have cheaper options to Owchy! Even your Fords of this world do it.

MJK's plan was simple. You offer a base model Elise Exige as cheap entry and introduction to the brand (£25-35k). It's such a great car you will love it and as you get older you buy an Evora (2+2 with very young children) £50-60k. Thats such a great car your kids grow up, you're 40+ have free income you buy the new Esprit £80-100k. If People are very successful he had a Supercar in the 5 year plan at £150k. There was even a couple of "Lotus......(other brand)" specials in there.

People pop in and out of other brands but the idea was to hook them into Lotus as a brand and to do that you need to be able to offer cars across all costs base's.

Unfortunately DB changed all that when he came in and MJK's (and RB's) plans never got past 2 years (and I would point out that they made profit and the new Esprit would have been out by now) so we will never see the outcome.

I wish we had though because I had and still have 100% in MJK's plan and model range. They were stunning and 100% Lotus, both designed and DNA.

^^^ 100% in agreement with Kimbers. this plan was/is so sound I'm sure DRB is going back to it!

Lotus did produce/sell around 3200 back in 2008 they were all Elise/Exige. The only reason they are not selling Elise now is that they are not proposing them on the market. That's due to the fact that production has been idle from december 2011 to may 2012 and that they've focused on delivering cars that were on backlog. If Lotus was able to have a normal production year with Elise, Exige and Evora, it would be around

3200 cars minimum again. MJK's target was 2000 Evora per year. Elise can still sell numbers they just need to market the car in the right market to a maximum of people and offer creature comfort that will make the car more usable.

Edited September 5, 2012 by NedaSay

[Gus82]

Can't see a direct Elise replacement happening. If Lotus can do a small sportscar it needs to have the broader appeal and higher price of the Boxster. Even then it would need to share large amounts of components with a larger model such as the Evora or Esprit, or alternatively be developed by Lotus with some (financial) input from another OEM who wants a cheaper version to sell through a widespread global sales network. If Toyota and BMW have chosen to collaborate on a new sportscar then there is no shame in Lotus doing it! I do think though that a Boxster rival with a Lotus badge would be very marketable, possibly using the Elan name.

The other car Lotus really needs is a 911 rival (possibly with a small price premium as has been suggested). This could either be a revised Evora (all new interior mainly, plus GTE looks) or an Esprit (2010 Elan concept restyle, new era Lotus style interior, Evora GTE engine etc).

A 458 rival seems unlikely in the short term now....

[Bibs]

This month's Evo has another piece from Mike Duff stating that the 5 new cars including the Esprit and it's engine have been officially canned according to Lotus insiders. I've asked Hethel for clarification but initial reactions was that it's not the case.

[Guy Munday]

They've not been canned but. as the development teams have been reduced in size, some of the engineers have been re-deployed on using their new-found knowledge to make current product even better.

Nice to have the focus restored on what we can sell today rather than what we might be able to sell tomorrow although tomorrow may never come without the new product, of course.

[Bibs]

The wording is "Now sources inside the company have confirmed that all five of its new car projects are dead, including the new Esprit and its V8 engine - just as Bahar sues his ex-employer for what he claims is wrongful dismissal'.

[Stirling_Villeneuve]

Is the Esprit officially canned then.... is Wolf Zimmermann still there?

[NedaSay]

Too bad, the Esprit looked good imo! If the Esprit has been canned, does it mean that the car business is in deep trouble? Cause I believe it does!

Edited September 11, 2012 by NedaSay

[Iconic Ride]

How reliable is EVO's Mike Duff, and who, exactly, are his sources? What has been his past record on accuracy?

Anyone?

[Kimbers]

From what I am told DB's "un-targetted" way of dealing with things has left many projects unfinished and they would cost too much to finish them.

On top of that he's left the company with no money and in huge debt which means all the money DRB had for investment is currently going into paying debts and finishing the Exige S plus continueing plans to keep improving the Evora.

Their way of doing things is a very tight spending style of business plan but hopefully only in the short term until things are put straight but...and it's a big but...a car company is only as good as it's on going development programme. You need new models to keep on top of things.

I don't know their plans but a friend tells me they expect things to stay like this till early next year.Hopefully, costs will have been controlled enough that they can restart a project or 2 and fund it properly.

[Stirling_Villeneuve]

I can't help but think DRB would do Lotus a favour if they told people what was actually going on instead of leaving it to the rumour mill.

[Bibs]

Evo are wrong. The Esprit is definitely still being developed as is the engine however DRB have slowed this down while they get a grip on what they've got.

It's most certainly, as of now, not been canned.

[softlips]

I can't help but think DRB would do Lotus a favour if they told people what was actually going on instead of leaving it to the rumour mill.

This

[richardvg]

Sounds to me like they actually want to see where they are at however i could not agree more .....say it like it is and what the plans are .....How can you expect client confidence when you say sweet nothing .

[Iconic Ride]

You know it's been too quiet when you can't even remember the name of the new COO.

Mr. F.'ing something, right?

What rock is he hiding under?

[NedaSay]

Evo are wrong. The Esprit is definitely still being developed as is the engine however DRB have slowed this down while they get a grip on what they've got.

It's most certainly, as of now, not been canned.

Thanks Bibs I prefer reading that!

[Gus82]

I'm less than convinced about all this. For a start what really needs to be done to finish the Exige S? I can't believe it takes all Lotus cars current resources to do this. And whilst I don't necessarily expect detailed mid or long term plans from Lotus/DRB some indication regarding the future of the Evora is needed.

A shocking statistic in Evo's piece is that Group Lotus has only made a profit once since 1996 (2009 I think), so downsizing to just making the Elise/Exige doesn't sound like a great plan. The Evora is crucial.

If work on the Esprit and V8 has frozen they'll end up having to start from scratch soon enough, as otherwise they will end up with a product thats always playing catch up to the more established car makers. And they need to start preparing the ground if they are entering this market to prepare consumers for the very significant change in market position. With hindsight Bahar ramped up the publicity too high and too soon, but with the comprehensive trashing of the original plan and the lack of public commitment to the Esprit, Lotus will need to start more or less all the brand building from scratch.

Sorting out the positioning of the Evora (as it is the car that should have the highest profit margin AND the broadest appeal) must be a priority and must be completed as soon as possible. Whatever your opinion on it, the Lotus F1 team could give the marque a leg up at the end of the year and using it effectively to promote the current product is frankly a no brainer. However they'll blow it if there is a communication strategy to avoid public attention.

[Kimbers]

I'm less than convinced about all this. For a start what really needs to be done to finish the Exige S?

A shocking statistic in Evo's piece is that Group Lotus has only made a profit once since 1996 (2009 I think), so downsizing to just making the Elise/Exige doesn't sound like a great plan. The Evora is crucial.

Apparantly overheating issues on the Exige S. Put the roof scoop back on!!

2008 1.5 million. Unfortunately MJK left due to his back after that and though he freely admits due to exchange rates, he would have made a loss in 2009 he still believes he would be back in profit now with the new Esprit out.

The Evora is crucial. I think the ongoing development is primarily on quality issues and "tweaks". But personally, I think it could do with some Marketing spend, especially in the USA where under DB he spent more on one catering bill for a party on non existant product than a years worth of marketing spend in the US on existing products.

[fmxa]

Tweaking for quality isn't going to help the Evora in the US market unless they spend money on getting it past the Federal requirements it currently fails on and has exemptions for (which expire soon). So not much point spending on marketing for something they can't sell ...

[NedaSay]

^^Which exemptions and when will they expire? Do you know?

Edited September 12, 2012 by NedaSay