Lotus ‘restructuring’ another round of blood-letting

News that Lotus is going though yet another rebuild, this time with the potential loss of more than 300 jobs, brings to mind the blood-letting after the British brand hired former Ferrari executive Dany Bahar in 2009. The restructuring before the latest round of restructuring came at the Paris motor show in 2010. I was at the Lotus stand, waiting for the press conference to start, when I spotted two ex-pat Kiwi businessmen deep in discussion in a roped-off area. Surprise! Surprise! Neville Crichton and Kevin Wall. Crichton’s Ateco Automotive company handled Ferrari and Maserati in New Zealand and Australia then and Wall was his main man. What were they doing in rival territory with Lotus’ Malaysian owners? Wall (now regional manager for Aston Martin in NZ and Australia) recognised me, wandered over and said they were just visiting. Something like that anyway.

Minutes later, CEO Bahar unveiled an ambitious 10-year NZ$1.6 billion plan for Lotus. Its global sales network would be overhauled, he said. There would be five new Lotus models, starting with the supercar Esprit, he said. Lotus would expand into emerging markets such as China, he said. I rushed off to the press centre and quickly wrote a piece for the motoring pages of the NZ Herald, adding that no way in the world were Crichton and Wall ‘just visiting’ the Lotus stand. Crichton’s PR Edward Rowe would say only that their presence at the Lotus stand was basically none of my business but that Ateco, like any smart company, was always looking for ‘business opportunities.’ There had been speculation for some time that Ferrari’s operation in this part of the world would largely become a factory-owned franchise, ending Crichton’s exclusive seven-year association (although he would retain his Ferrari Maserati outlet in Sydney). Would the changes at Ferrari and the new global changes for Lotus pave the way for Crichton to handle Lotus in NZ and Australia? That is exactly what happened, but not before more drama. I interviewed Bahar at Lotus headquarters in the northeast of England in 2011. We talked mostly about why he believed Lotus had been neglected as a brand. “Twenty years ago we were mentioned in the same breath as Ferrari and Lamborghini. But there has been no investment lately,” he said. “Our new range will be world class, innovative, pioneering and green.”

Roughly eight months after that interview, Bahar was gone, sacked by the board of Malaysian-owned Lotus after complaints about his behaviour, understood to centre on Bahar’s love of fast living, which allegedly included giving away Lotus cars as gifts and making generous use of helicopters, first-class flights and five-star hotels. Executives who had backed Bahar’s expansion plans went, too. The board then quickly pared back the planned new model turn-out. There were reports that DRB-Hicom, the Malaysian owner of Lotus, made Bahar a scapegoat for the failings of its own subsidiary, Proton, which controlled Lotus for more than a decade. In July last year DRB-Hicom released a three-year investment programme for Lotus after buying the Malaysian Government’s 42.7 per cent stake in Lotus’ parent company Proton. This latest restructuring once again calls into question the future of the famous British nameplate. Lotus employs around 1250 people worldwide, more than 1000 of whom are based at its HQ in England. Group Lotus said in a statement: “The company wants to ensure that it has the right organisational structure in place to achieve its business goals and to build a strong, sustainable future.” New Lotus CEO Jean-Marc Gales – former head of PSA Peugeot Citroen – says the reshaping of the business “is in no way a reflection on our employees who have shown nothing but dedication to us and have worked tirelessly to support Lotus.”

• A couple of years ago Crichton’s PR Rowe outlaid plans for Lotus in NZ. They included driver training days modelled on the Lotus Driving Academy. “We are looking at using tracks in Australia and New Zealand for the academy,” said Rowe. “They are an excellent sales tool for both bringing customers to the brand and demonstrating what the cars are capable of in a safe and controlled environment.”