Lotus Collateral Damage from Potential Sale of Proton
A recent report from analysts reveal that ownership of Lotus may soon transfer should Proton fail the sale.
Back in 2012 a controlling stake from Proton was purchased by DRB-Hicom for approximately $420 million but has since struggled to keep afloat and is now reaching out to more than a dozen firms for a potential buy-off.
Just recently, PSA Group, maker of Citroën, DS and Peugeot cars, has confirmed that they have responded to DRB according to Reuters. At the same time, Renault and Suzuki have done the same.
It has been mentioned that DRB is open to considering a sale of Lotus. According to reports, Lotus, in its 65 year history, could be in the midst of its own turnaround within the year, according to CEO Jean-Marc Gales.
The Malaysian government supported Proton itself by injecting $365 million of funds amidst being warned that the automaker was not sustainable without a strategic foreign partner. This was all after Proton reported a pre-tax loss of approximately $198 million.
The identified cause of the weaknesses from Proton is its two Malaysian plants which has a combined annual capacity of 400,000 cars. Proton is slowly gaining a market footprint in the Southeast Asian market but plateaus and declines due to inferior products and a lackluster after-sales service. In 2015 alone, Proton sold only 102,000 cars.
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