Geely Automotive Holding, who owns Volvo, is set to buy the British sports car maker, Lotus. As a part of the deal, Geely is looking to buy 49.9 per cent of Malaysian carmaker Proton from its parent company DRB-Hicom. Geely also gets 51 per cent of Lotus from Proton, thus acquiring full ownership of the British marque. The agreement is expected to be concreted in July.
Geely intends to revive the loss-making Proton brand and similar to their history with Volvo back in 2010, it plans to bring in new developments and expanding product and technologies for Lotus. Lotus, on another hand, was having a hard time with new product development. Now with the cash flowing in from the Chinese giant, we could see more Lotus cars with new vehicles on the ground, which the carmaker has been wanting to do for half a decade now.
The acquisition would give the Chinese carmaker access to Proton’s powertrains, but most importantly an entry to the South Asian market. But this is nothing compared to the benefit the Chinese giant can reap from Lotus Engineering. Lotus expertise in engine and suspension could also help Volvo’s Polestar division in the years to come.
This is the fifth time Lotus has changed hands in the last three decade. Founded back in 1952 by Colin Chapman, Lotus became a part of GM in 1986. It was later acquired by Romano Artioli in 1993 and sold to Proton in 1996. Proton was bought by DRB-HICOM in 2012. Now Lotus looks at the Zhejiang-based carmaker for its future, and only time will tell whether Geely is able to turn the fortune for the British sports car maker.
