Lotus cuts 550 jobs as Hethel closure feels inevitable
Lotus Cars has announced more redundancies at its Hethel factory as Emira sales stall and debts rise
Lotus has confirmed it is to make an additional 550 staff redundant at its Hethel factory in Norfolk, with a source close to the matter suggesting this could rise to 700, which would leave around 300 people at the home of the British sports car brand founded by Colin Chapman.
The news was broken to staff in a company-wide meeting on Thursday 28 August and follows the recent departure of Vice President of Lotus Cars Mat Windle and last month’s news that Geely, Lotus’s owners, was planning to close Hethel until the Government stepped in. In a statement released to evo, Lotus said: “Following a review of Lotus Cars business objectives in line with the current market conditions, the company has announced a restructuring proposal, which anticipates a reduction of up to 550 roles across the business in the UK.”
Lotus saw an initial upturn in fortunes when Geely took a 51 per cent stake in the brand in 2017, which not only saw it develop a heavily revised version of the Evora to create the Emira, but decide to step into the electric hypercar market. Through Lotus Technology, the Chinese arm of Lotus controlled 100 per cent by Geely, the brand also launched the electric Eletre SUV and Emeya GT-saloon. Unfortunately for Lotus all four models have been commercial failures, leaving the brand with huge expenses and debt it can no longer service.
The statement provided by Lotus went on to say: “The proposal is designed to enable Lotus Cars to operate with a flexible and agile business model, allowing it to ramp up operations and resources in line with demand, as and when needed.” Lotus went on to say this approach is necessary “in order to secure a sustainable future for the company.”
Operating in markets that either face tough global competition (electric vehicles) or contracting market share (low-volume sports cars), Geely needs to find an immediate viable solution for Lotus’s future. One such avenue could be for Lotus Engineering to take on a more prominent role at Hethel, as hinted at in the official statement - “the company plans to increase integration globally across the wider Lotus group and is exploring greater sharing and collaboration across its operations.” With Geely-owned Polestar making cutbacks at its MIRA engineering facility, it would make economic sense for the Chinese electric car brand to upsticks and relocate to Hethel. Hethel could also be used as a production facility for Eletre and Emeya models that are currently imported from Wuhan, although this would require sizable investment to update the current facilities. Production of the reengineered plug-in hybrid Emeya and Eletre models could also provide a much needed lifeline.
Outside of Geely’s own brands, Lotus Engineering has a proven track record working with third-party manufacturers from design to engineering sign-off programmes, and this could be an avenue Geely focuses on for the survival of the brand. Regardless of what Geely decides, it appears Lotus sports car production at Hethel is a thing of the past.
