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Lotus courts investors to capitalize on China’s electric car revolution

The car company made its name with the Lotus Seven, a lightweight open-top sports car manufactured from 1957 before it sold the design to Caterham.

It encapsulated what became the pattern of Lotus-engineered sports and racing cars – a lean design, which lost unnecessary weight, or as Chapman put it, “simplify, then add lightness”.

The same year it also made a fiberglass car in the Lotus Elite, praised for its high performance while using petrol from a 1.2 liter engine.

Following the untimely death of Chapman at the age of 54, the firm was sold to General Motors in 1986, which then passed it onto Italian car dealer and Bugatti owner Romano Artioli in 1993, who in turn sold it to Malaysian car company Proton.

Proton, owned by both Geely and Malaysian billionaire Syed Mokhtar Albukhary, continues to hold the minority stake.

Li, who founded Geely, has been on an overseas buying spree in recent years, hoovering up Sweden’s Volvo, for instance, in 2010.

Last year Volvo’s sales and profitability hit record highs, delivering 699,000 units and profits of 20.3bn Swedish krona, while it was valued at more than $15bn in a Stockholm listing.

An initial public offering for Lotus would mark the latest move into public markets for one of Geely’s investments. But whether it can be another success story, and capitalize on its heritage of low-run lightweight sports cars in China, is another question.

China has acted as a useful growth engine for high-end British cars with a growing middle class, and 5.2m dollar millionaires as of 2021 according to figures from Credit Suisse.

But rich Chinese buyers have typically favored models such as Bentleys – whose sales in the country grew 40pc last year to make up almost a third of its global total – Rolls-Royce, or Aston Martin.

If Lotus tries to position itself against established German-made luxury competitors with deep pockets, established models and sharp pricing, it could come unstuck, Prof Graves warns: “It’s very difficult to compete against Audi and Porsche.”

A spokesman said: “Lotus has never had an opportunity like this before with the scale of ambition of Geely.”

They added Geely’s expansion of Volvo’s production and profits shows how it can build a brand, and that Lotus’s engineering expertise can be capitalized upon to make high-performance battery-powered cars and SUVs.

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