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Interview: Lotus CEO Dany Bahar
Top Gear: What’s the lowdown on Lotus’ current
situation? Is administration a real threat?
Bahar: Lots of these rumours can be put to bed and I think that’s what our
new owners DRB-HICOM tried to do with the statement that they released. In it
they clearly stated that they’re not considering a quick sale to a Chinese
buyer or moving production away from Hethel or putting Lotus into administration.
I’m in daily
contact with Malaysia, in addition to this the Managing Director of DRB-HICOM,
Dato’ Sri Haji Mohd Khamil Bin Jamil, Proton’s new Chairman, visited Hethel on
Wednesday 2nd May and reassured the management team and staff
representatives that DRB-HICOM is not thinking about a sale of Lotus right now.
He also made it clear that a sale still could be an opportunity, but it is not
DRB-HICOM’s priority to consider this right now for Lotus. That’s what we were
told and I have no reason to question it.
Dato’ Sri is
aware that the uncertainty is damaging the business and the brand, but he said
that he needs time to completely understand the business before making a
decision about Lotus and this could take a few months. This makes our life
very, very difficult, but I have no choice but to accept the situation and be
patient. We presented him with our journey so far since the Paris Motor Show
2010 and he was heavily impressed with what he saw, not only with the current
line up, but he showed a special interest in the future cars.
TG: Are any parts of Lotus profitable at
DB: I hope you understand that we can’t go
into any details, as the takeover process has heavily interfered with our plans
and we are still in the process of getting our heads around where exactly we
stand at the moment.
TG: Have you added value to the company
during your stewardship?
DB: There are lots of improvements since we
started this journey back in 2009 – let me list the most important ones:
The management team has improved overall operational excellence and
introduced greater governance.
Since the journey began, turnover has consistently increased
(£110m/FY09, £139m/FY10, £150m/FY11).
A reduction in assembly labour hours by as much as 16%.
We established Lotus Product Council to ensure improved governance
around product development.
We moved to multi-line approach to improve production optimisation and
The dealer network is undergoing rationalisation, with new markets
developed and less effective sites closed.
Modernisation and improvements of the Lotus site.
Third-party engineering division restructured and strengthened.
TG: Are cars being built at
Hethel as we speak? Is the factory at full production?
DB: Up until the end of March
production was running at a vastly reduced rate but since 1st April we have
ramped up production again and from the beginning of May we’re back to normal,
which means that we are producing 46 units of per week. The cars built are a
mix of Evora and Elise. Production of the Exige S will start this summer.
TG: What about
development of the new models? Of
the five cars unveiled at Paris in 2010, we already know the Elan has been
DB: First we have to explain,
that up until the takeover process began, Group Lotus was on track to meet the
major milestones as set out in the five year business plan. However, from
December 2011 onwards financial support from Proton and from the banks
providing our loans has been strictly restricted due to takeover legislation.
As you know the business plan was founded on timely financial injections, so it
was clear from the outset that if the flow of money was significantly
disrupted, the business would reach a critical stage very quickly. This means
that at the moment all the future projects are on hold - with one exception:
development of the new Esprit project has been given a green light. I can’t say
more than that at the moment other than to reiterate that the Chairman liked
what he saw of the future range so that’s a positive sign.
TG: Where do you
see Lotus sales growth coming from with the new models?
DB: A couple of
weeks ago I travelled to the Middle East and China where we just opened new
dealerships and I could really sense an excitement about some variants of the
current cars, especially the Evora S/IPS, the Evora GTE – particularly in China
- and the Exige S. There’s also a
great deal of interest in the future cars from these markets.
TG: Does anyone thinking of buying a Lotus
need to be concerned? If not, why not?
DB: No one needs to be concerned about
Lotus. The values that Lotus has always stood for, performance through
lightweight, creative innovation still stand strong. Every single employee is
showing true fighting spirit every day in trying to keep this vision alive.
This is a fact – no matter what people outside of Lotus may say. Beside this, every single car built here in Hethel represents not only the Lotus core values
but also our new quality standards, this should reassure anyone thinking of
buying one of our products.
TG: Have you had to trim back your
motorsport program? If so, is that purely for financial reasons?
DB: If this question refers to our decision
to release two teams in IndyCar, then I can assure you that we are not trimming
back. It’s the opposite. Not only can we concentrate more on the remaining
teams, we’ll also increase the resources and the financial support for our
engine partner Judd to increase our engine performance. All the other
motorsport activities continue as per the original plan. You could argue that
this is a very expensive exercise, but I can tell you that most of our
activities are built on a non cost basis, were both parties benefit on a brand
and engineering level.
TG: Do you think that some people believe
that the current product thinking (more power and more weight) undermines Lotus heritage
and possibly alienates existing owners and Lotus ‘add lightness’ fans?
DB: What can I say? We
have been a loss-making company for many years now. It shows that with the
current product, or with an affordable product – as good as it is – it’s just
not enough to sustain this operation. You have to move up the ladder to offer
products that make a margin. To satisfy a buyer who is ready to spend £60-70k,
you simply have to offer the right quality to justify the price - and this
didn’t always happen in the past. We are now starting to get the quality we
want, to get the designs we want, and we now have an order bank of more than
1100 cars. The more expensive models are a major part of this – and I’m just
talking about the current products. So yes, we have to focus on key elements
oustide of the original core values a bit, but I still can assure every Lotus
fan, that we’re trying to be lighter than our competitors and that the ride and
handling will be second to none.
TG: What’s your strategy? Are you taking
your ideas from other car companies?
DB: The vision for Lotus has nothing to do
with any other car company. It has to do with my admiration for a British brand
with strength, individuality and a history that’s second to none. I believe
that every car manufacturer should have its own strategy, its own unique
identity, built on heritage and on the potential to grow.
Lotus is a perfect example: when we came here in 2009
we saw the perfect opportunity to revive – not reinvent – the brand. There was
a realisation that affordable small cars could not make money. The decision was
that we would make more expensive, more powerful, premium sportscars. This is
something that even Colin Chapman saw the potential for and tried to achieve.
TG: Have things worked out the way you
DB: No, not at all. The takeover of our parent
company Proton by DRB-HICOM couldn’t have come at a worse time, but – again -
up until that point Lotus was on track to meet the major milestones as set out
in the five year business plan. The takeover process has put Lotus in a very
difficult situation and it is very frustrating that the only thing we can do is
to wait for a final decision how to move forward. In business sometimes things
happen outside of your control and you have to do everything you can to make
the best of it.
TG: Any regrets? What about the recent press
release that caused such controversy?
DB: No, why should we
regret anything? I’m sure there are pros and cons to everything we do, but I
think this is what Lotus is about. We’re not a mainstream company. We don’t
pretend to be corporate, we don’t pretend to be a big car manufacturer. We do
things in a Lotus way. After all we are humans with certain emotions: we are
happy, we are angry, we make mistakes and we try to learn from those mistakes –
and that is summed up in the way we behave and how we communicate. Look at
Lotus’ past: this company has gone through so many things: success, defeat,
bankruptcies, jail, fraud, death. I think that gives you a special position. If
you like us, you love us, if you don’t like us, you hate us. I don’t want to
say we’re a polarising company, but Lotus is something special, something very
more on Lotus, including an interview with Chief Technical Officer Wolf
Zimmermann and an exclusive drive in the Lotus Evora GTE (seen in action
below), you need this month’s Top Gear magazine – out now.