The Chinese company is considering investing $1.9 billion in Lotus.
Remember when Lotus was on the brink of bankruptcy? Fortunately, those dark days are now a distant memory. Today, the company is much more financially secure thanks to Geely, the Chinese company that bought a majority stake in the British sports carmaker last year.
According to Automotive News, Geely is now considering investing at least $1.9 billion to help revive Lotus and allow the relatively niche automaker to compete with big-name sports car manufacturers such as Porsche. An unnamed source told Automotive News the Chinese automaker, which also owns Volvo, is planning to add facilities and research centers for Lotus in the UK as part of the investment.
It will also reportedly increase its 51 percent stake in Lotus with its Malaysian partner Etika Automotive, which holds the remaining 49 percent stake. "Geely is fully committed to restoring Lotus into being a leading global luxury brand," the company responded in a statement when asked about the investment but refused to comment further.
Geely plans to use the investment to expand Lotus's Hethel plant in the UK by hiring 200 new engineers, according to one of the sources. It then plans to set up a second factory in the UK, possibly in the West Midlands, to increase production and add a new design and innovation center possibly in Coventry, UK. In addition, Geely has already committed to building a new Lotus factory in China. In the long-term, it's believed that Geely wants to position Lotus as a luxury brand to that competes with Porsche and Ferrari.
Lotus's first ever SUV will likely help position the brand as a luxury carmaker, which is expected to ride on the same SPA platform as the Volvo XC90 and XC60 to keep it lightweight. Lotus is also considering adding two crossovers to its line-up, it hopes will double production. Automotive News reports that Lotus only sold 145 cars in the first seven months of this year, with sales falling by 25 percent, so these SUVs should help rectify this. Of course, Lotus will still continue making sports cars, including a replacement for the Elise or Evora and an all-new track-focused model.