Lotus to cut 200 jobs as a result of disappointing 2022 sales and £145m losses

Sad news but not a huge surprise:

"Lotus has confirmed proposals to cut up to 200 jobs in response to a significant fall in sales last year.

The Geely-owned manufacturer maker sold just 576 cars in 2022, down from 1566 in 2021, which it blamed on supply chain issues in the second half of the year.

Last year, Lotus sold just one model, the Lotus Emira, having ended production of the Lotus Elise, Lotus Exige and Lotus Evora in 2021. The Lotus Eletre entered production this year.

The cuts, confirmed by a spokesperson speaking to ITV, were part of a move by the Norfolk-based brand to “restructure its workforce" after it posted losses of £145.1"

Lotus proposes 200 job cuts at Hethel and Warwickshire bases | Autocar

Norfolk-based manufacturer's plans includes axing engineers and admin roles; brand sold just 576 cars last year

www.autocar.co.uk

And this:

"Sportscar-maker Lotus Cars is to cut up to 200 jobs in a move it claims will make it "leaner and more competitive long-term".

The manufacturer, which is based at Hethel in Norfolk, described the move as a restructure of its workforce" and said it would work to find new roles for workers where possible. It has not said where.

Lotus is owned by the Chinese car giant Geely, which took a majority stake in Lotus in May 2017, when it vowed to "unleash the full potential" of the marque, with the ambition to raise production to 10,000 cars a year.

Lotus Cars' most recent accounts, published on Friday, showed that the number of cars the company sold dropped from 1,566 in 2021 to just 576 in 2022.

A note in the accounts explained that the drop in sales was "limited in the second half of the year with the production challenges faced" by the supply chain the automotive sector.

The company lost £145.1m in the year to 31 December 2022, up from losses of £86.6m a year before.

A Lotus spokesman confirmed the job cut plans, and said: "Lotus Cars' proposal for a reorganisation of its business is to ensure that the right organisational structure is in place for us to achieve our business goals and to build a strong, sustainable future.

"This includes a restructure of its workforce, which may involve the loss of up to 200 jobs.

"Wherever possible, we will look to support the redeployment of staff and plan to look for ways to retain specific skills and knowledge within the business, despite the proposed cuts. We believe this is vital to ensuring the organisation is leaner and more competitive long-term."

The firm said it expected 2023 to be a "record year for vehicle production".

The spokesman added: "Our shareholders have made a clear commitment that the UK, having invested over £500m into Lotus Cars’ UK R&D [research and development] and operations and created many new jobs at our new London headquarters, as well as in Norfolk, and this shows the long-term commitment to the brand in the UK."

https://www.itv.com/news/anglia/2023-07-19/sportscar-maker-to-cut-200-jobs-amid-heavy-losses

 

[Tokion]

Sad news but not a huge surprise:

"Lotus has confirmed proposals to cut up to 200 jobs in response to a significant fall in sales last year.

The Geely-owned manufacturer maker sold just 576 cars in 2022, down from 1566 in 2021, which it blamed on supply chain issues in the second half of the year.

Last year, Lotus sold just one model, the Lotus Emira, having ended production of the Lotus Elise, Lotus Exige and Lotus Evora in 2021. The Lotus Eletre entered production this year.

The cuts, confirmed by a spokesperson speaking to ITV, were part of a move by the Norfolk-based brand to “restructure its workforce" after it posted losses of £145.1"

Lotus proposes 200 job cuts at Hethel and Warwickshire bases | Autocar

Norfolk-based manufacturer's plans includes axing engineers and admin roles; brand sold just 576 cars last year

www.autocar.co.uk

And this:

"Sportscar-maker Lotus Cars is to cut up to 200 jobs in a move it claims will make it "leaner and more competitive long-term".

The manufacturer, which is based at Hethel in Norfolk, described the move as a restructure of its workforce" and said it would work to find new roles for workers where possible. It has not said where.

Lotus is owned by the Chinese car giant Geely, which took a majority stake in Lotus in May 2017, when it vowed to "unleash the full potential" of the marque, with the ambition to raise production to 10,000 cars a year.

Lotus Cars' most recent accounts, published on Friday, showed that the number of cars the company sold dropped from 1,566 in 2021 to just 576 in 2022.

A note in the accounts explained that the drop in sales was "limited in the second half of the year with the production challenges faced" by the supply chain the automotive sector.

The company lost £145.1m in the year to 31 December 2022, up from losses of £86.6m a year before.

A Lotus spokesman confirmed the job cut plans, and said: "Lotus Cars' proposal for a reorganisation of its business is to ensure that the right organisational structure is in place for us to achieve our business goals and to build a strong, sustainable future.

"This includes a restructure of its workforce, which may involve the loss of up to 200 jobs.

"Wherever possible, we will look to support the redeployment of staff and plan to look for ways to retain specific skills and knowledge within the business, despite the proposed cuts. We believe this is vital to ensuring the organisation is leaner and more competitive long-term."

The firm said it expected 2023 to be a "record year for vehicle production".

The spokesman added: "Our shareholders have made a clear commitment that the UK, having invested over £500m into Lotus Cars’ UK R&D [research and development] and operations and created many new jobs at our new London headquarters, as well as in Norfolk, and this shows the long-term commitment to the brand in the UK."

https://www.itv.com/news/anglia/2023-07-19/sportscar-maker-to-cut-200-jobs-amid-heavy-losses

I guess it would have made even more sense if we knew what the approximate head-count was before the cut? Not sure if this is public information? I wish that a stronger Lotus (UK) emerges out of this and especially that their quality control keeps on improving. I look very much forward to the arrival of my I4 FE towards the end of this year.

 

[Porter]

Folks, a gentle reminder about the forum rules on political posts is appropriate here.

Commentary on the parent company of Lotus and their actions is OK, but shifting that to discussing the actions of the Chinese government or whether to buy Chinese products is not.

Did you really delete my post here? And are you really saying that considerations about whether Lotus would continue as a viable concern if the geopolitical situation deteriorated are "forbidden" topics on this forum?

This isn't a case where I made any statement whatsoever about China itself, the comparative value of Chinese products, desirability of a product being made there, or anything like it.

Would love a touch of clarity on this issue, either publicly or direct by PM please.

 

[Evotion]

All in all, this is really sad news. Whatever one's experiences with the company, and car, thus far, it is (was?) still a great UK small company filled with passionate people, satiating a typical British appetite for 'special' cars.

I hope they bounce back stronger, critically still supported by Geely.
The car itself and the company's lack of success is, I would say, 95% down to the horrific bad timing of a post-Covid, high inflation, parts supply nightmare.

I wouldn't blame the management per se but, of course, remain a tad flabbergasted by the overall sales and Customer Service thus far, which did need looking at a LOT earlier on.

That's a big loss. Hopefully, a really bad announcement will not follow and Lotus do indeed build the required number of cars to satisfy global demand.

 

[Lotustoronto]

I can not see them producing much more than 25-35 cars per day. At the moment they were hitting 23-24 per day and it seemed fairly steady and chock full of parts. Completed Emira's everywhere waiting for shipping.

The job cuts seem strange IMO. They are still developing new cars and going to build a new electric sports car. Right now shouldn't be the time for lay off's. Unless the demand we keep hearing about is perhaps a little artificial?

 

[frazzer]

Just confirms there are a lot easier ways to make money than to build and ship sports cars, it's a tough and business riddled with external and internal risks. Aston Martin's losses doubled in 2022 to almost £500m. They are also talking '23 up as there turn around year.

I wish Lotus well, let's hope the bottom is in.

 

[Porter]

@TomE not sure if you saw my post above, I'd appreciate some earnest clarity on the topic if you have a few minutes.

 

[Lowtush]

I wonder how many of those 200 were on the NFT team...

 

[CoryC]

This really doesn't make any sense to me. They stopped production of the prior 3 model vehicles 2 years ago as Emira was to replace them, but they're a year and a half behind in production so both the UK and dealerships abroad haven't had a new Lotus product to deliver to consumers for over a year... how is this a shocking statistic, and why would it mean job layoffs? This had to be predicted, but also will rectify itself once they're actually DELIVERING all these vehicles that have been pre-sold. If anything they need to get MORE staffing to ramp up production AND customer service to try and right the ship... they know they have a product in demand, but have been very poor at comms and logistics. Yes... there were global issues that drastically impacted their ability to get cars out, but there seem to be a number of issues that were seemingly self inflicted as well, I mean... they've been promising cars to the NA market for nearly a year, and while they've continued to move the goal post because of delays, they have YET to get proper certification for the vehicle model?! Now they're cutting staff from self inflicted sales dips?

 

[Porter]

This really doesn't make any sense to me. They stopped production of the prior 3 model vehicles 2 years ago as Emira was to replace them, but they're a year and a half behind in production so both the UK and dealerships abroad haven't had a new Lotus product to deliver to consumers for over a year... how is this a shocking statistic, and why would it mean job layoffs? This had to be predicted, but also will rectify itself once they're actually DELIVERING all these vehicles that have been pre-sold. If anything they need to get MORE staffing to ramp up production AND customer service to try and right the ship... they know they have a product in demand, but have been very poor at comms and logistics. Yes... there were global issues that drastically impacted their ability to get cars out, but there seem to be a number of issues that were seemingly self inflicted as well, I mean... they've been promising cars to the NA market for nearly a year, and while they've continued to move the goal post because of delays, they have YET to get proper certification for the vehicle model?! Now they're cutting staff from self inflicted sales dips?

But Cory... the UK press are wind-up merchants. They only operate on a level of nuance matching the following:

MONEY LINE ON CHART GO DOWN!! EVERYTHING NOW ON FIRE!! THE WHOLE OF ENGLAND NOW UNEMPLOYED AND THIS IS WHAT WE DESERVE!! EVERYONE SHOULD PANIC CONSTANTLY FOR EVERY REASON IMAGINABLE!!

Then every automotive outlet picks up this nonsense and rebroadcasts it uncritically, usually while reducing the level of context and detail to a level that is utterly un-parseable by normal people.

 

[KAR120C]

I’ve been thinking more about this for a few days. And possibly, just possibly, Lotus is making some sense.

Some years ago my company was preparing to launch a new product and it was decided that the launch would be the most important priority for the company. So, we redeployed people, did some layoffs, killed or slowed some projects, etc. That money was reallocated to the core areas that would be producing, marketing, and distributing the new product. The launch was successful, the money came in, and slowly the other areas could return to pre-launch conditions.

Perhaps, Lotus is looking ahead to it’s big market in North America. They need the NA launch to succeed. They need spare parts, full production starting in September, and shipping and storage for the push. If they are keeping production staffed, supply chain processes staffed, and right sizing engineering for the Emira, maybe the money is being diverted towards the NA launch. When actual cars are delivered, cash flow will improve and they can breathe again.

I assume Geely has put the hammer down on Hethel and it would be a reasonable response.

It's just a thought...

 

[TomE]

I drive a Mexican-built Audi and am quite happy with it. It's a legit question, and I suspect it'll apply to Lotus sooner rather than later, so good luck policing that conversation going forward. It already applies to the Eletre.

Did you really delete my post here? And are you really saying that considerations about whether Lotus would continue as a viable concern if the geopolitical situation deteriorated are "forbidden" topics on this forum?

This isn't a case where I made any statement whatsoever about China itself, the comparative value of Chinese products, desirability of a product being made there, or anything like it.

Would love a touch of clarity on this issue, either publicly or direct by PM please.

@TomE not sure if you saw my post above, I'd appreciate some earnest clarity on the topic if you have a few minutes.

Folks, sorry for the delay in replying on these, it's been a busy few days with other stuff.

We have clear forum rules about political posts. There are a few topics which can have a tendency to shift from legitimate to grey area to clearly political, sometimes quickly. We tend to jump in and close off these sub-threads before they get that far. Sometimes this might be while they are still in "grey area" and sometimes it is when we see multiple consecutive posts building on a theme. Two such topics which have been tricky on here have been EVs leading to debate about climate change and political impetus for EV uptake, and Geely leading to debate about Chinese government policies and in some cases overtly racist posts.

If you want to have a discussion about what makes a Lotus a Lotus, then reframe the question and debate that. My dad used to have old Bentleys and the purists always said a "real" Bentley had to have been built at Cricklewood before the company was taken over by Rolls Royce in 1931. His 1935 Derby-built car didn't count.

There are people who won't buy items manufactured in China. Debating the reasons for that on here is likely to cross into breaching the forum rules. So discussing whether Emira or Eletre sales might be affected by making them in Hethel or Wuhan is very likely to get cut short.

It's also difficult to have a discussion about how Lotus or Geely might react to a hypothetical geopolitical event when that event (however likely or unlikely you think it is) hasn't happened and so this is inherently linked to a political subject. With the Russian/Ukraine impact on supply chains, we can discuss that impact on Lotus without getting into the politics because it's a real situation and we don't need to comment on the political aspects. I appreciate some people may see these as essentially the same situation but they aren't.

You could start a topic about what might happen following a US election and changes to trade policies and tariffs on imported cars, but this risks sparking a political debate and would be halted. We've already had discussions about the impact of actual taxation differences on the V6 and i4 in different countries and hence on OTR prices and relative sales. We monitor those discussions very carefully and will usually head off side tracks about government taxation policies or emissions if it strays into climate-related aspects.

As with a lot of moderating, there are grey areas and the moderator team have to make judgements. We often discuss these amongst the team or will act and then flag the posts to the rest of the team to review too. There have been situations where we disagree on something borderline and we let those posts stand. We also flag single posts to the team if we think they might go off in the wrong direction and keep an eye to see how they develop.

All of the admins and moderators are volunteers, no one works for or is affiliated with Lotus (or Geely) and they are unpaid. We're happy to explain why we've removed posts, either in a thread or in a private message, and all deleted posts are notified to the original poster with a reason for the deletion. The posts are actually hidden rather than deleted, and all moderators can see them and if necessary can reinstate them. No warnings are issued when we've pre-emptively pruned a sub-topic we're concerned about - it is only clear and deliberate rule breaches that result in a warning or suspension.

I hope this explains the actions taken. If this needs any further discussion or clarification I'll move it over into the "how we approach moderating" thread.

 

[dgrace]

I still think you're incorrectly conflating "country of origin" with "political" but appreciate the response. Ultimately the market reaction to Eletre will answer my question definitively.

 

[AGP]

I moved my deposit from and I4FE to the base I4 in May due to the price increase.
Lotus CC sent me the below random Email yesterday, which I really don't know what to make of it tbh.
After putting a deposit down the day after the reveal, I think all the excitement has been sucked out of me and my want is at an all time low..

Good morning,
I can see that you are on the base edition list.
However there is no guarantee on timing or any information on the further generations of Emira.

 

[digilotus]

I moved my deposit from and I4FE to the base I4 in May due to the price increase.
Lotus CC sent me the below random Email yesterday, which I really don't know what to make of it tbh.
After putting a deposit down the day after the reveal, I think all the excitement has been sucked out of me and my want is at an all time low..

Good morning,
I can see that you are on the base edition list.
However there is no guarantee on timing or any information on the further generations of Emira.

Very random indeed and your feelings are totally understandable. It's a bit like playing a snakes and ladders game where there are more snakes than ladders...

 

[AGP]

Very random indeed and your feelings are totally understandable. It's a bit like playing a snakes and ladders game where there are more snakes than ladders...

That's a great analogy

 

[nelly111s]

Very random indeed and your feelings are totally understandable. It's a bit like playing a snakes and ladders game where there are more snakes than ladders...

And I don’t think the ladders go to the top, either.

 

[meenboli]

Agreed, it is pretty nuts. They probably should have continued building the outgoing models a bit longer. They could have sold them and at least production would have had something to do.

I mean they got circa 10k deposits for the Emira in those bad/low sales years. You’d think that counts for something….

As far as income the deposits count for nothing.

They don't go to Lotus (in case it can't pay them back) it goes into an independent holding 'pot'.

Won't show on their annual figures - it's just a indication of customer intent to purchase.

The loss is huge (obviously) - but a drop in the ocean for Geely.

2022 was the worst year for car sales in 3 decades n the UK - so they're not on their own.

2022 sales figures: car market slumps to worst performance for three decades

Detailed analysis of the UK new-car market in 2022: what sold, what didn't and full breakdown by brand

www.carmagazine.co.uk

 

[Gridgway]

As far as income the deposits count for nothing.

They don't go to Lotus (in case it can't pay them back) it goes into an independent holding 'pot'.

Won't show on their annual figures - it's just a indication of customer intent to purchase.

The loss is huge (obviously) - but a drop in the ocean for Geely.

2022 was the worst year for car sales in 3 decades n the UK - so they're not on their own.

2022 sales figures: car market slumps to worst performance for three decades

Detailed analysis of the UK new-car market in 2022: what sold, what didn't and full breakdown by brand

www.carmagazine.co.uk

Just curious how you know that the deposits go into a bank account that's not lotus?

 

[meenboli]

Just curious how you know that the deposits go into a bank account that's not lotus?

I was told that explicitly when I placed my deposit, that it goes into a holding account that Lotus has no access to.

I have no reason to think they weren't telling the truth.

I assume it's so it doesn't get spent should you decide to request a refund!

 

[Gridgway]

I have no reason to disbelieve what you were told, but I don't really believe it! If they have no access to it, how do they get the money from it when a customer actually orders? Or when the "distance selling" period is over?