Lotus in the post DB era

[Eglise]

The car that saved Lotus (allegedly) was the Elise so why not make an all new Elise. Sell at similar money to the current model and the slightly low rent aspects of small volume build can be overlooked. A new Esprit would need a bespoke V8, high end interior and a body not made of grp to justify its price tag, in other words a huge leap from the Evora that I struggle to see Lotus being able to achieve.

[Stirling_Villeneuve]

With you on that 100%. 

[softlips]

The car that saved Lotus (allegedly) was the Elise so why not make an all new Elise. Sell at similar money to the current model and the slightly low rent aspects of small volume build can be overlooked. A new Esprit would need a bespoke V8, high end interior and a body not made of grp to justify its price tag, in other words a huge leap from the Evora that I struggle to see Lotus being able to achieve.

Because to design and engineer an all new Elise will cost a similar amount to doing an Esprit - and manufacturing costs are similar too. The Elise has got cheaper and cheaper since its inception - my S1 111S was £30k, it wasn't a cheap car. There is also much more competition now.

It's volume Lotus need, whatever model they sell.

I've been a loyal customer for the past 13 years, not to mention a couple of Lotus cars going back to '87... I'm thinking of changing my car next year and as Lotus don't feel it's important to keep my interest I'm looking elsewhere....

The cars are good... BUT thanks to DRB's complacency I'm discovering other people make some damn good cars too...

Well done DRB, you're doing a great job for your competition!

Same here, sadly. I very much doubt my next toy will be a Lotus.

[Eglise]

An all new Elise could use a modified Evora platform and an off the shelf 4 cyl engine, there is potential for high (by Lotus standards) sales volumes and it wouldn't be competing against Mclaren in the market place.

[cnapan]

"The car that saved Lotus (allegedly) was the Elise so why not make an all new Elise."

 

What the Elise showed is that you could have on your hands a car which garnered rave reviews and developed a strong, loyal following, yet only ever sold in low numbers (though high for Lotus, which isn't saying much), and didn't earn enough in total to prevent the company being able to shake itself free of its chronic money problems that it have dogged it for decades. 

 

The Elise as is will never find a big market. If it could, it would have done by now. Lotus need cars which have broader appeal, so they can sell more of them, and therefore spread the cost of development across far larger volume sales. It costs Lotus the same to design a new Elise if they sell 1000 a year or 10,000 a year. 

 

The costs of developing a new car can be spread either by it being very expensive (McClaren P1) or very popular (Porsche Boxster). A low volume, cheap, capable, technically advanced car might be our dreams but it won't pay for itself. 

 

That's fine if you're a company where you have at your disposal the profits from one range of vehicles to plough in to the cars you really want to make, but not so great if none of the cars you make recoup the investment made in a short-enough amount of time to ensure your product range can keep up with the competition.

 

The long-term future for Lotus must be based on selling enough cars at enough profit to fund future developments at a rate which keeps it relevant, competitive and ahead of the regulations curve. If not, it will remain a cap-in-hand outfit requiring 'investment' every few years which in truth is little more than large amounts of cash to stop it folding.

 

They could announce 100 cars a week right now, but it doesn't do anything to colour in the plans for how to keep the show on the road in 5 years, which might be longer away than DRB cares about if it's thinking of divesting the company once 'stabilised'...

[TBD]

Even today after writing off all the Elise development costs Lotus can't earn a decent cent on this car, regarless of how many they build. Remember, it is all hand built and unless UK laborers are willing to work for Malaysian salaries that will never become a profitable proposition in this price class.

 

If Lotus wants to relaunch a new Elise they will have to partner with someone who can manufacture and sell the base model, leaving Lotus to sell a top performance exclusive derivation. 

 

Developing that car for whatever partner would be another very big plus for Lotus. After all, this is what saved Porsche when they were charged with developing the Touareg and spun of the all so profitable Cayenne.

[Vanya]

Wouldn't there be a formidable backlash by consumers if Lotus did that? I think for a lot of us the allure of Lotus is the fact that they are hand-built. A large part of the reason I bought the Esprit is because it to me is a definitive representation of British industry and innovation - knowing it was put together on UK soil by workers not on a slave wage is a source of pride. That kind of thing I can support, even if I wasn't around to buy the car new.

 

I don't think the Elise would be as popular had it been made in say, Romania, or in a factory making more mundane cars. Wouldn't it be "easier" if the baseline Elise were to be assembled, still in the UK, entirely by machines and the other, more premium models, put together at stations by individual workers as per tradition?

 

I know Porsche have their "baseline" models such as Cayman and Boxter put together in Finland (not a cheap country so I don't quite understand why the switch from Germany) but if they can keep the majority of their operations on their home turf, why not the UK?

 

Another proposal would be to raise the Elise pricing to that of a Cayman/Boxter and retain a more powerful third party driveline to justify the price while keeping costs low - this would more or less make it an Exige S with an Elise body. Could this work as a compromise?

Edited November 22, 2013 by Vanya

[TBD]

Look at these production numbers from Porsche:

Production 2012       151.999  

911                             28.419

Boxster/Cayman         13.316

Cayenne                     83.208

Panamera                   27.056

 

So, Lotus is building 1-3% as many cars annually. Having machines assemble the cars requires a major upfront investment for tooling, assembly line and robots which just doesn't fit with Lotus production numbers. On the other hand, neither does selling cars at a lower price on tight margins.

 

BTW, Porsche has managed that potential backlash very well over the years. Go to any track day and count the Porsches. There are still as many there as there are also at the golf club. The secret word is called "marketing!" But that is what DRB doesn't understand

Edited November 22, 2013 by TBD

[Stirling_Villeneuve]

Interesting figures, McLaren are aiming their  P13 at the 911 market, but still only looking at 2000 cars per year, which for them is huge. I'm sure it'll be amazing but it'll also be a hand made product and far more exclusive. 

Edited November 22, 2013 by Stirling_Villeneuve

[LotusLeftLotusRight]

Why don't Ferrari muscle in on the junior supercar sector? A V6 middie à la Dino / Evora would sell like festive Panettone at Christmas (probably taste better too).

[Kimbers]

There would definitely be a huge market for a smaller cheaper all new sports car like the Elise. But Thomas is right.

 

25 years in the motor industry and I have seen a huge change in car development. No longer can even some of the richest manufacturers develop their own cars, even those selling 500,000 a year still have to share development of chassis/engine and running gear, though many still design their own body and interior.

 

I don't think a collaboration would hurt Lotus in any way. It would give them a cheaper cost base to price point the car and they could "Lotusfy" it to give it Lotus DNA. So, as an example, you could possibly take the GT86 base, do your own body (2-400kg lighter for more performance) interior, Boost the engine power above the Toyota model and Voila, you have a sub £30k sportscar!

 

That is just an example, not a recommendation so please don't come back saying "Yeah but that car is......" You can see what I am trying to say.

 

How different is that to some of Lotus's best car collaborations? Lotus Cortina, Sunbeam, Carlton.

 

Look at just some of the tie in's across the sector:

 

Peugeot/Citroen (Fiat in here with vans)

Kia/Hyundai

VW/SEAT/Skoda

Renault/Nissan now with Mitsubishi

Even Toyota and BMW collaborate on Sport car development

Mazda uses Ford Engines

 

 

And in the performance Sector:

 

Mazda MX5 and Alfa Spider

Audi/Lambo

Porsche use a VW V6 in the Cayenne to keep development costs down

Many of the smaller performance car manufacturers use engines from large manufacturers

Ford/Volvo/Yamaha V8 engine

 

This list could go on and on.

[Snoopy1969]

because it would kill the exclusivity (often mentioned by Ferrari CEO)

[Kimbers]

Lotus aren't Ferrari, someone else made that mistake and nearly bankrupted the company.

 

Did the Cortina kill the Europa? Did the Sunbeam kill the Esprit? Did the R8 kill the Gallardo?

 

You're argument doesn't make sense as it is one car out of a range. Why would a collaboration on a new Elise kill the Evora, or potential new Esprit, which are all different cars? Lotus are already known for great collaborations. When a company wants their car to be Lotusfied they go to Lotus. If anything it boosts their reputation as an engineering company who makes cars to showcase their skills! Which is what it's been in it's most successful times.

[LotusLeftLotusRight]

because it would kill the exclusivity (often mentioned by Ferrari CEO)

Ferrari, Porsche and Aston Martin handed in the "exclusive" tag a long time ago (have you seen Ferrari World, Abu Dhabi?). Whereas 20-odd years ago, you could go months without seeing one, now it's a daily occurrence. Today it's just sell, sell, sell. A mid-engine V6 Ferrari would sell in huge numbers: they could even market it alongside the new V6 turbo F1 engines. That would make the Evora or its replacement struggle even more in the marketplace.

Edited November 22, 2013 by LotusLeftLotusRight

[Snoopy1969]

@@@kimbers, sorry I was too late to push the button, my argument was an answer to LotusLeftLotusRight, not to your post - for Lotus a colaboration would make sense in general, I agree, see Porsche: their (see Thomas figures of production) by far most model, the cayenne is not even produced in a porsche production plant, the body is from Bratislava, as the touareg 

[Advantage]

I can't really see what an outside manufacturer would gain from a collaboration. A parent/umbrella company, yes. But using the GT86 as an example, surely that would just highlight to the motoring world that Toyota know little about making a car any good. They're already retailing what they think is their best effort and then another company brushes that aside and improves it. Wouldn't this undermine their engineers and subsequently the customer confidence in the original product?

[Bee]

Or it could give them the cachet of saying: 'When Lotus wanted the best possible base from which to develop a new, class-beating supercar, they came to us ...'

[TBD]

25 years in the motor industry and I have seen a huge change in car development. No longer can even some of the richest manufacturers develop their own cars, even those selling 500,000 a year still have to share development of chassis/engine and running gear, though many still design their own body and interior.

 

Just to highlight this point the VW group has defined two vehicle frameworks, the MQB for transverse mount and the MLB for longitudinal mount) that will be the base of ALL group vehicles, VW, Audi, SEAT, SKODA, etc., except Porsche. These frameworks include all the high development cost elements from engine, transmission through electronics.

 

I can't really see what an outside manufacturer would gain from a collaboration. A parent/umbrella company, yes. But using the GT86 as an example, surely that would just highlight to the motoring world that Toyota know little about making a car any good. They're already retailing what they think is their best effort and then another company brushes that aside and improves it. Wouldn't this undermine their engineers and subsequently the customer confidence in the original product?

There is a lot to be gained, as Kimbers pointed out. From a carmaker perspective these top-of-the-line variants, be they Lotus Carlton, Lotus Cortina, Lotus Sunbeam, or today the BMW M-line, the Audi RS-line and the Mercedes AMG-line are nothing else but marketing. They are there to boast e sale of the bread and butter models by giving these a higher perception.

 

In fact, even Audi, BMW and Mercedes have these models handled by independently operating units (AMG, M-Line, Quattro GmbH). You need different engineering skills to produce a high performance variant than you do to produce a cost optimized basic model. 

[Gabber]

Can someone explain what is so great about the Porsche marketing ? DRB know nothing about marketing maybe true but what is Porsche doing ? I see almost never any advertising for their cars in magazines, never any tv commercials, not much sponsering etc. Lotus gets more headlines thanks to F1these days positive good results and negative financial situation.

Kimbers has some good points , I think it was nice if Lotus had joint Mazda and Alfa with the new roadster !

About F1 any ideas if DRB will help out if things gets really wrong financially ?

[Stirling_Villeneuve]

About F1 any ideas if DRB will help out if things gets really wrong financially ?

 .... now that IS funny!  

[JLStrange]

I'd vote for a new Lotus Cortina. For decades, Americans always connected Lotus-Ford when performance was concerned since Jimmy Clark, etc. at Indy and other racing venues. Nobody under the age of 40 remembers those good times.

I'll take the white one with the green stripe down the side please. Come on Ford, step up with your new small sedans.

[NedaSay]

About F1 any ideas if DRB will help out if things gets really wrong financially ?

 

Uh it's a licensing deal, Lotus F1 team gets a deal to use the brand but nothing else and yes Proton has an option but I doubt they'll ever go with it as Proton is busy getting its act together. 

[Gabber]

 .... now that IS funny!

Maybe so but the F1 is great marketing for Lotus. If all whats been told is true Lotus earning money from it with selling the F1 clothing through Lotus originals. Is the loan paid back yet, if not and things go wrong then Proton will end up with a F1 facility at least that was the deal . Also are there not two people from DRB in the F1 board ? I know DRB will not save the team but a bit more support and a closer corporation would benifit both.

[cnapan]

"Can someone explain what is so great about the Porsche marketing ? DRB know nothing about marketing maybe true but what is Porsche doing ? I see almost never any advertising for their cars in magazines, never any tv commercials, not much sponsering etc. Lotus gets more headlines thanks to F1these days positive good results and negative financial situation."

 

Porsche find themselves in the enviable position of not having to try hard on the marketing front, simply because their products have become both aspirational and common, i.e. there are a lot of mobile adverts driving around the streets every day. This isn't a uniquely Porsche thing. Look at Range Rover - they've managed the same thing, and JLR are on a bit of a roll right now.

 

That said, Porsche have an excellent, well-placed range of dealerships, they attend trade shows and put targeted ads in a wide variety of magazines which target people with disposable income. For example, they had full page ads running in New Scientist for the Panamera hybrid over the last few months, no doubt trying to prise a bit of cash from those Cambridgeshire millionaires! They're also strong in motorsport (though Lotus do well here of course).

 

Lotus dropping out of car shows seemed to me more of an admission that their cars weren't mainstream enough to generate enough leads to justify the cost of attending the show, but it did seem a particularly desperate form of cost-cutting. Few people have the balls to pretend to want to buy a 60 or 100 grand car at a dealership when you can't afford it yet, but a car show gives us hairy masses the chance to sit in some exotica and start the process of falling in love with a brand or type of vehicle which we aspire to and perhaps sometime eventually are able to afford.

 

But in the end, even the best marketing can't fix the product. No matter what the dynamic appeal of the car range, if not enough people come forward to buy one, and the people who do come forward don't want to pay what it really costs to not just build them but also fund R+D on their replacements (which has never been more costly), then you have a broken proposition that nobody in their right mind would invest in to 'save'.

 

"The Successful Lotus in 2020?". What must that company look like? How many cars must it sell? How much profit must they make per-car on average? How will they build them? Where will they build them? What will cars even have to be by then? How much will it cost even to develop a car by then? Has anyone even done the spreadsheet?

 

For fun, can anyone with a better understanding of these things throw a few numbers at the thread?

[Eglise]

I doubt Lotus cars ever make any money, as I understand it Lotus are a design/ engineering consultancy who build a few cars to showcase their core business, don't ask to buy a new car at 'cost',