Matt Windle Is Bullish about Lotus's Future Prospects

Change has come to Lotus Cars, as a trip to its longtime home in Hethel—set amid the gentle, rolling farmland of Norfolk, England—soon reveals. New (since 2017) owners, China’s Geely have infused billions, enabling Lotus to commit to an all-electric future, dramatically increasing production, and more than doubling its number of workers in England, while launching an electric SUV, Eletre, to be built at a massive new factory in China’s Wuhan, capable of churning out 150,000 “lifestyle” cars annually, only slightly less than Lotus’s total production over its entire 72-year-history.

Company executives can also speak now about future model plans in ways that don’t elicit disbelieving guffaws, such as in 2010 when one briefly tenured Lotus captain, Dany Bahar, rolled out five half-baked “new” future models at a Baldwin brother–festooned Hollywood launch event, not long before departing the cash-strapped company by trap door. New managing director Matt Windle assumed the post in 2021, having worked at Lotus as an engineer and also at Tesla, which orientation and experience, one suspects, bode well for his priorities. He spoke with Jamie Kitman in an airy office in one of the company’s new buildings.

MW: Welcome to Lotus. This building we sit in, the Chapman Production Centre, is all brand new. Over the last three years at Lotus, we’ve spent a hundred million (pounds) in facilities investment and on three factories: One that we sit in here is for Emira. One over there [pointing] for Evija, and then we’ve also got a new factory in [nearby] Norwich that’s doing all of our chassis and a lot of our mechanical stuff.

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The pace of change has been massive. Hopefully you see that from the last time you were at Lotus, the difference around the site and the preparation. But it’s not just what you can see on the surface. It’s IT systems, the high-voltage system—we didn’t have enough power coming into the site. We’ve done all the roadways, we’ve done a new staff restaurant, and all those types of things which have been really important in bringing this business up to date, ready for the challenges that we’ve got going forward.

C/D: Can you describe the state of the U.K. car business, of which Lotus is a part—and increasingly a large part?

MW: It’s as difficult as it’s ever been. It’s not just COVID, but Brexit as well. Our cost of dealing, cost of invoicing and logistics have gone through the roof, [worsened by fuel] costs because of the war in the Ukraine, and inflation. So, it’s as hard as it gets. But we’re still smiling, we’re still trying to go strong. And I think the element that is positive for us is the strength of the order book—so strong for Emira particularly—that it gives you the confidence that you just need to keep fighting through these issues and keep going, really.

You may have heard we have a little bit of political turmoil at the moment. You can kind of come [to Britain] every six weeks and see a different prime minister. So the outlook for us as far as relationships with the government and things is shifting as well. But that’s where I can see that Lotus is blossoming, that we are having those interactions with the government now. They want to know what our strategic plans are because we are going to be the first volume sports car manufacturer in the world that commits fully to go into battery electric vehicles. Emira is our last internal-combustion mass-production car. And that aligns perfectly with what our government policies are around zero emissions and the industrial revolution, if you like, to the green economy.

C/D: Electric is Lotus’s future and we’ll get to that, but what about the Emira?

MW: Well, we’ve taken over 10,000 orders for the Emira, and a third of those are from the States. We launched the car just before Goodwood last year. And between then and Goodwood this year we sold more cars in one year than we sold in the previous six years combined. So yeah, as far as sales goes, it’s very strong.

I was out [in the States] there for the Lotus Owners Gathering that was in West Virginia. And a lot of the owners there had their first drive of the car, and they were really, really pleased with it as well. [The U.S.] is an incredibly important market for us. I’ve been out there quite a bit. Know the team over there. We’re expanding the dealer network over there as well. For us, it’s an area of growth, a market that we really want to develop. We need to grow the team.

C/D: The Evora was a great car, but didn’t sell especially well in the States. We loved it, but there were many who were convinced that it didn’t warrant a luxury price tag. How is the Emira going to change that equation?

MW: We’ve got a lot of work to do, we recognize that. You asked the question about whether the brand can take it to that next level of luxury. And it can. But we realized we were starting from a pretty low base. I agree on Evora as well: It was an amazing car to drive, but it was a bit of a compromise to own, wasn’t it? And we realized if we were going to grow our volume to the ambitions we have for the sports cars, we needed to make something that was more accessible.

The Emira’s on the same wheelbase as Evora, so you could say it’s a similar car, but everything’s new on it. And what we’ve looked to doing is ingress/egress, storage, cupholders, which obviously was always a criticism, but we’ve got cupholders now. The interior is brand new, electrical architecture with displays and information that you would expect. It’s a car like people are used to, but then under the skin [it’s a Lotus].

Quality was a big, big thing for us that we knew we needed to step up if we were going to go into a volume market. So we’ve invested in fully automated assembly. It’s not a monocoque, but if you want to call it the “monocoque” part of the car, the chassis to the body sides to the bulkheads to the roof, that’s all automated in production. And we’re seeing accuracy of that at about 99.7 percent against where it should be as a target [versus an estimated 85 percent before.] You probably won’t get any better than that. And so we know that core of the car is absolutely spot on. And then from there building out, it’s given us a much better-quality car, with fully automated, cloud-based inspection systems that can spot defects or misalignment.

We have new electrical systems, LED lights, all of those comforts that everybody expects is now on the Emira. There is a bit of a price to pay with the weight because of the [new] content we put in there—it’s around a 1400-kilo (3087 pound) car. To compensate for that, we widened the track, we’ve increased the wheel size. So dynamically it’s as good as an Evora. It’s not quite as light, but it’s as good as an Evora, and with those comforts.

C/D: With some notable exceptions, dealer support and quality in the U.S. haven’t been anything to write home to mother about, either.

MW: I can understand the frustration. Because [our dealers] really haven’t made much money out of us over the last 25 years. So why would you get excited if you know can sell some Ferraris and make some margin, you’ve got a Lotus that you’re not going to make much on? But again, we understand where we’re coming from, and I can’t apologize for what’s gone before, I can only look forwards. But we’ve invested a lot in the dealers this year. We had a global dealer conference here so we invited them over, brought them into our confidence, showed them the Type 133 which will launch next year, the E-segment sedan that’s coming, off the Lambda platform [shared with the Eletre] and fully electric.

They came here and then from nothing [to sell], they were looking at the Evija, Emira, and Eletre that are being launched in March, and what’s coming next year. The dealers I’ve met traveling around the States seem really good, and we just need to give them the opportunity by giving them the product. You quite rightly said Lotus’s resurgence will be through product, it won’t be through talking about it, and I think, dare I say, that’s been tried a bit in the past and didn’t work. So we just need to get the products that are out there that are right.

C/D: Some of the wags in the British press corps I’ve been talking to since arriving in the U.K. have suggested that the Evija isn’t selling. I’ve read otherwise. What is the truth?

MW: Well, we have sold Evijas. And the [limited edition] Fittipaldi Evijas are pre-sold. But the program I always talk about is the one that got impacted most by COVID, which is where we started. Evija was out testing, we were in America, we were Germany with it in 2020, and we had to bring it back and it kind of sat on the shelf for about a year.

So, it’s only now that our customers have driven it. Fittipaldi customers were here at the weekend, they drove the car. The first time we put customers in the car, and I can tell you they got out very happy with their purchases.

And yeah, selling cars in that [price] bracket ($2.1 million in the U.S.) is different. It’s not like the Emira where you could pick up hundreds of orders in a week. It’s a slow process, and it’s a lot of money. People want to know that they’re going to keep the value in their money.

I think Lotus can go [upscale], and we are going there. We wanted to do it [with the Evija] though more as a halo project. Something to put Lotus back on the map. Particularly in States where our representation was very small, where people are like, “Oh do you know Lotus?” “Oh yeah, yeah. The Formula One team.” “They still make cars.” “Really?” So it was kind of like we needed to do something with the brand to get that back.

Our dealers are really excited about the Eletre as well. It’s hard to build a brand back up from what we were. Or even to build a brand up, because it’s never really been where we are trying to go. But we’re getting there.

And there’s no pressure. We’ve said with the Evija, we’ll do up to 130 [total units], but if we don’t get there, that’s not an issue for us either, really. It’s not as if we’ve got to sell that number to make the business case work. It was never that type of project. It was more about showing what we could do, innovation, creating a halo product, resetting the design DNA as well. So from Evija, into Emira, into Eletre, you can see where that link is through in those cars as well because that’s what we needed to do.

So I’m pretty relaxed about the Evija. I like to call it the best car in the world that nobody really knows anything about. And I would say watch this space in 2023, because we have some interesting things planned for that car. It can’t go racing, but it could do a lot of speed stuff. Some records are out there we’re looking at. Our simulations are looking very good.

C/D: Americans are historically suspicious of Chinese investment, business practices, and quality controls, yet Geely seems really sensitive as corporate backers go. Volvo’s experience with them seems far more positive than not, certainly. That they would have the vision to see Lotus as an opportunity that they would want to be involved with, and that they would invest heavily in and let people get on with what they do best is impressive. It’s almost by definition something that’s a long-term project. You can’t turn it around in six months and say everything is where we need it to be. So how have you found them and how much has it made possible? Could you imagine a better benefactor?

MW: No, I don’t think I could, to be honest. And I think you reference Volvo there and a lot of people worried about the brand and where it was going to be. And I always say I think Volvo’s more Swedish now than it was when it was taken over 11 years ago. And what they’ve done, you can see with Volvo, you can see with Polestar, it’s a product offensive. They like to take over an undervalued or under-invested brand, invest in building that brand, and do it through products.

And quality, for where we want to get to, is the biggest investment you need to make. You can’t do it in a short period. So the Emira is a big jump on for us. And then going further on when we increase our volume as far as the sports cars are concerned, you’re then getting into areas where you can invest in metallic panels and the tooling that comes with metallic panels because you’ve got the volume so the quality starts improving.

With Geely, quality is the one thing they talk to me about all the time. It’s our first KPI [key performance indicator] we measure. We don’t measure output, we don’t measure cost, we measure quality first. And again, I’ll show you when we walk through the factory, you’ll see where we’re trying to get to is a no-fault forward. Historically here you’d kind of get a car at the end of the line and it’d be like, “Right, it’s got a few problems with it, you’ve got to work it out.” Now the mentality is it does not come out your station unless you’ve got that quality, and you are responsible for that.

I think as a backer Geely is incredibly demanding, yet they’re incredibly supportive as well. The strategy we went to them with, they’ve backed. Obviously since then we’ve had COVID and we’ve had wars and bits and bobs. It’s not just a little bit off course, but they’ve never wavered. They’re just like, “We can see where you’re going.” My CEO was here in September, first time he’d been here for three years, and he actually said, “You can now see the light at the end of the tunnel with this business, where it’s going with the product.” The order book is what that assumption is based on.

We had a plan called Vision80, which was the new products moving to battery-electric vehicle production in China, global operation. We’re halfway through that plan, and we’re smack on where we want to be. Some of the cars, the Emira for instance, is a bit late to market but it’s ready to go.

As a sports car manufacturer, we will be the biggest in the U.K.—that’s my aspiration—and they’re backing us all the way. It’s demanding and yeah, I do feel like I’ve worked about 15 years in the last five, but it’s also rewarding and I think the love is there for this brand. I’ve worked in some startups where you’re trying to establish a brand and it’s really, really hard work. The love for the Lotus brand is so big that it deserves to work and it deserves to have the right products. We’re keeping that link to the past and respecting the past, and Geely is all about that as well. They love the history.

C/D: Let’s talk for a second about selling Lotuses in China, where you’re expected to sell a lot. And with the huge capacity at the new factory there, it seems like much of Lotus’s fate is in the hands of that relatively young automobile marketplace.

MW: Yeah, there’s a massive dealer network being set up there: 51 new dealers between now [and next October]. It’s huge. The pace of change there is incredible. And here as well, where we are building a new brand experience center in London, going in on the corner of Piccadilly and Berkeley [in Mayfair]. Open March time. They’ve done something similar in Shanghai. China will be a huge part of the Lotus market.

Because of the investment model, under Group Lotus, there sits two companies, Lotus Cars, which I manage, which is the sports cars bits. And then there’s Lotus Technology. Lotus Technology is working on the lifestyle cars as we call them in China.

C/D: Oh really? A different engineering team?

MW: Yeah. In some areas like attribute setting, dynamics, they use our services and then for software, IT, and more importantly autonomous driving, we use their services, so we kind of cross over.

The Eletre for instance has gone autonomous driving Level Four. [It has a] smart, intelligent cabin, all of those things that we haven’t quite got in the sports cars yet. We haven’t got that experience in our engineering, but that technology, as is needed for sports cars, will come across as well. This is what I was saying about the quality and content of the sports cars as we go forward will just be improved because we’ve got this other area of the business as well.

C/D: What about the sports cars going forward?

MW: Next up is the Type 135, our next-generation sports car, which will be all electric, in 2024–25. We will be building that here in Hethel, and we will need to put in significantly increased production capability for that. The Emira will be produced and sold alongside of it, though we expect it to outsell [the gasoline-powered car].

C/D: Is there hope for something smaller, cheaper, and electric?

MW: It’s not in the plan at the moment. If you’re talking about an Elise [replacement], which we’ve been asked about before, I hope it’s an area somebody else will pick up. If I’m totally honest, there just isn’t the margin in those cars for what we are investing in product development.

C/D: Yeah. It seems to me that there would be a way to make money selling a stripped-down simple car that was as light as it could be, and yet electric.

MW: That may be in the future, [but] the problem at the moment is internal combustion engines have got to a point where they’re quite cheap because there’s millions of them, and they’re developed, and battery-electric systems are still quite a new technology, and the numbers of them are quite low. So as demand grows and investment in R&D in those systems, yeah, the prices will probably come down. We’ll probably end up in 10 or 15 years’ time with something that’s the size of a laptop that can go 300, 400 miles, and then we’re laughing.

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