Lotus has recently announced plans to cut over a quarter of its workforce around the world. The English sports car manufacturer employs a total of 1,215 people and has just announced plans to cut 325 of them. Overall, this represents a total reduction in workforce of 27 percent.
With cuts this big it can hardly be believed that the company is merely trying to become “leaner,” but must be undergoing some form of major restructuring. Group Lotus has had rampant leadership and direction problems in the past. A few years ago, we were optimistic about their plan to release half a dozen new models by the close of the decade; such a move was the brainchild of now deposed CEO Dany Bahar. However, Bahar ended up being ousted amid accusations of corruption and mismanagement. In fact, he later ended up being sued by Group Lotus for repayment of large sums of company money he used on personal expenses, such as renovating his private residences.
After the departure of Bahar, the plans for aggressive model expansion were slashed quietly, in favor of more manageable goals. However, a few weeks ago the whole community was stirring with premonitions that Lotus would produce a sedan and possibly a crossover. Previous concepts showcased by the company also supported this. This seemed to represent a significant divergence from the brand’s identity and skill set and to some seemed way above their grasp.
What is plaguing Lotus is the plight shared by many low-volume specialty manufacturers today. In an era where many of the world’s sports car manufacturers have been gobbled up by larger companies, standalone performance manufacturers are starting to struggle. The reasons for this could be numerous, but most obvious is a lack of capital that comes by way of having a larger parent company to invest in research, motorsport, and new model development. Small manufacturers also struggle due their inability to consolidate various engineering, production, and other tasks, in contrast to those brands owned by larger companies. With Lotus’ parent company, Malaysian automobile manufacturer Proton, half a world away and not eager to invest, the Norfolk based sports car manufacturer might as well be going it alone in this sense.