Lotus signs joint venture agreement with China's Goldstar

Sat, Apr 18 2015

Lotus and China's Goldstar Heavy Industrial Company are forming a joint venture that will bring the historic British sports-car maker into the country.

"The collaboration seeks to accelerate the development of Lotus cars in the premium sports segment in China," according to the announcement. The JV will include research projects on efficient and advanced technology, and ultimately lead to sales of cars there, Lotus said.

China's auto market is no longer experiencing the double-digit growth of the past, but it still continues to expand. Meanwhile, Lotus saw sales jump 55 percent in the last fiscal year and it opened 36 new dealers, according to CEO Jean-Marc Gales.

The joint venture announcement also hints at the possibility of Chinese-made models, but it shouldn't dilute the brand. Lotus is clear that core vehicles like the Evora, Exige and Elise would remain exclusively in production at the headquarters in Hethel, England.

Just a couple years ago, Lotus appeared to be on its deathbed after losing a quarter of its workforce, but since that setback the company has started to crawl back.

PROTON, LOTUS GROUP AND GOLDSTAR SIGNED JV AGREEMENT

KUALA LUMPUR – PROTON Holdings Berhad ("PROTON") the ultimate holding company of Lotus Group, announced that it has signed a Joint Venture ("JV") Agreement with Lotus Group International Limited, United Kingdom ("Lotus Group") and Goldstar Heavy Industrial Co. Ltd. ("Goldstar") for a possible business expansion of Lotus cars in the People's Republic of China.

The collaboration seeks to accelerate the development of Lotus cars in the premium sports segment in China, leveraging on the incentives offered by the Fujian Provincial Government. Both PROTON and Lotus Group are subsidiaries of DRB-HICOM Berhad.

Signing on behalf of PROTON was the Honourable Tun Dr Mahathir Mohamad, Chairman of PROTON and former Prime Minister of Malaysia and witnessed by Dato' Abdul Harith Abdullah, Chief Executive Officer of PROTON. Signing on behalf of Lotus Group International Limited, United Kingdom was Jean-Marc Gales, Chief Executive Officer and witnessed by Mr Rohime Shafie, Director of Lotus Group and Chief Financial Officer of PROTON; and signing on behalf of Goldstar was Mr Zheng Qianghui, Chairman of Goldstar and witnessed by Mr Zhai Wenliang, President of Goldstar.

Dato' Abdul Harith Abdullah said "The JV Agreement will see the establishment of a new JV Company for the purpose of undertaking research and development (R&D) activities in the use of efficient and advanced technology. The JV Company will then produce and sell Lotus branded passenger cars as well as provide after sales services in connection with its products in the People's Republic of China.

"The automotive market in China is the single largest in the world today, and is still growing, therefore it is only natural for an established iconic company like Lotus to embark upon the possibility of expansion, venture into the market and seek the available opportunities, in light of the keen interest shown by the many enquiries received thus far. It is very difficult to ignore the market and Lotus will fill the gap in providing a lifestyle alternative to the growing demands of the affluent and market conscious local community," Dato' Harith added.

"On April 7, 2015, Lotus announced 55% increase in car sales for its 2014/15 financial year, compared to the previous year with 36 new dealers appointed during the period 2014/15. And China has appeared to be the top key growth market for Lotus exports and is expected to grow at a very fast rate. Lotus Group is excited about the opportunities of this new Joint Venture," Jean-Marc Gales commented further.

Lotus will continue to manufacture its current range of Lotus sports cars (Evora, Exige and Elise) exclusively at its HQ in Hethel, England.

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By Chris Bruce