British carmaker Lotus, majority-owned by China’s Geely Automobile Holdings, is exploring to float an initial public offering (IPO) to expand its production capacity. The company is considering the share offering in the US, the UK, or China, James Andrew, a company spokesperson, told Bloomberg. Lotus sports car division’s managing director, Matt Windle, told Financial Times that the company is in ‘early discussions’ for an IPO.
Key facts
The company showed a glimpse of its upcoming Type 132 electric sports utility vehicle (SUV) at an event in London last week attended by car dealers and the financial community to test investor appetite. Similar events took place last year in Guangzhou, Shanghai, and Beijing. The new SUV car, developed by Lotus Tech’s engineers in the UK and Germany, will be built in Wuhan later this year or early next year.
According to Andrew, the size of the issue and valuation are still to be determined, and no decision was taken on whether the company is proceeding with an IPO. The share offering aims to raise capital to meet the growth target of a 100-fold surge in sales in the next six years. The brand aims to sell 100,000 cars worldwide by 2028, and the company has said that half of its total sales may come from China in five years.
Key background
In 2017, Geely acquired a 51% stake in Lotus as a part of a deal to take control of Lotus’ former owner, Proton. Malaysia’s Etika Automotive owns the remaining stake. Geely also owns the Swedish luxury car brand Volvo.
Last year, Lotus split its operations into two business units, the UK-based company making sports cars and a China-based luxury lifestyle company planning to make electric sports-utility vehicles. Currently, the company has an electric supercar named Evija and its combustion engine-driven sports car named Emira.
Best performance
On January 7, 2022, Lotus announced that it had the best annual global retail sales performance since 2011. The company saw an increase of 24% in sales, from 1,378 in 2020 to 1,710 in 2021. The year saw the company’s last version of its Elise, Exige, and Evora, as they all ended production. Elise was the top global seller of the year.
Sales in the UK were up 29%, while Belgium sales surged by 37%. The US and Canada saw a year-on-year sales growth of 111%, which is also its best performance in the last 10 years. Qatar also had the best ever year since it started selling Lotus cars in 2016.
“Our global retailers have risen to the challenge of giving the Elise, Exige, and Evora the send-off they deserved. It means we’re in great shape for 2022 to focus on the all-new Lotus Emira, our last petrol-powered sports car and the best of breed,” said Geoff Dowding, executive director, sales and aftersales of Lotus.