Geely Auto to acquire full control of Lotus Cars, 49.9 percent of Proton

Article by Christian A., on May 26, 2017

After successfully closing a deal with Volvo in 2010, China’s Geely is now securing full ownership of Lotus -- the maker of Exige, Evora, Elise and 3-Eleven. The Chinese car company will be taking a 51% stake in Lotus from Proton as well as a 49.9% stake from DRB-Hicom, Proton’s parent company in Malaysia. Based on the agreement, Geely will have full control of the British sports car company since it will be purchasing the Malaysian-based conglomerate’s entire 51% stake.

Geely, owner of Sweden’s Volvo Car Group and London Taxi Company has promised to boost Lotus’ full potentials by increasing the development of its new products and technologies. The British sports car maker, as we know, has been merely updating its older models recently.

Since 2014, Lotus Chief Executive Jean-Marc Gales has been doing the best he could to revive the company after two decades of unstable profit. Not known to many, Lotus was completely banned in the US market after failing to meet the latest safety regulations of its airbags in 2015. It was only in the previous summer that Lotus products were once again allowed to be sold in the US.

Under the new ownership, Lotus will have access to better resources for them to develop a whole new model range. Likewise, Geely’s full control of the company will open more opportunities for collaboration--- especially in improving the performance of some Volvo models. The Swedish car brand could also produce more cars with better styling cues if Polestar and Lotus will work together.

As for Proton, the car company has been struggling enough, given that two of its factories in Malaysia have been producing less than the expected number of units. The number of cars it produces is significantly lower than the plant’s maximum capacity per year, which is up to 400,000. At any rate, Proton hopes to see a brighter future after Geely takes the company under its wings.

For one, the stake in Proton will provide Geely the access to reclaim its market share particularly in South East Asia. That said, the Chinese firm will have to use Volvo technologies with its new products in order to achieve more profit. The market for right hand drive vehicles is seen to increase especially in Australia, India, Malaysia and in the UK as a result of the new acquisition.

Other than Geely, Japanese multinational corporation (Suzuki) and French multinational firm (PSA Group) have both shown interest in acquiring the British marque. In any case, the deal signing between Zhejiang Geely Holding and Lotus Cars will be taking place this July.

Source: Geely

If you liked the article, share on:

Topics: lotus, proton, geely

Comments

Recommended

Nissan is commencing sales of the 2019 Nissan Altima on October 3, 2018 in the United States. As expected, the Japanese carmaker has already divulged the details and specs of...
by - November 26, 2018
Sports utility vehicles are still in heavy demand. Ford knows this very well as the American carmaker has seen sales of its SUVs surge dramatically by 28 percent in the...
by - November 26, 2018
BMW’s European customers who are looking forward to have a new range extender version of the 2019 BMW i3 (BMW i3 REx) will have to bear a bad news from...
by - November 26, 2018
Imagining the future of automotive luxury more than three decades from now seems to be a daunting task. It would be hard for a typical person imagine such future without...
by - November 21, 2018
Can a Dacia Duster be compared with a Ford Mustang? It would be difficult to do so as these vehicles compete in different categories and segments, have different price points...
by - November 20, 2018