Lotus shake-up could lead to the loss of 325 jobs

The production line at the Lotus factory at Hethel. Picture: Denise Bradley

The production line at the Lotus factory at Hethel. Picture: Denise Bradley - Credit: copyright: Archant 2013

As many as 325 jobs could be lost in a proposed global restructure of its workforce, Lotus has announced today.

Jean-Marc Gales CEO Lotus

Jean-Marc Gales CEO Lotus - Credit: Archant

The sports car maker currently employs more than 1,000 of its total 1,215 staff at its headquarters in Hethel, Norfolk.

A company statement said the plans had been drawn up following 'very careful consideration' as a way of cutting costs and reshaping its organisation.

It said it wants to ensure that it has the right organisational structure in place to achieve its business goals and to build a strong, sustainable future. 'Regrettably, it is likely that compulsory job losses will be needed to ensure that the company has the right number of people with the right skills,' it said.

Group Lotus intends to redeploy staff wherever possible and will look for ways to retain specific skills and knowledge within the business, despite the proposed cuts.

It also proposes to recruit into key roles, to help achieve the best possible structure and skill base.

Jean-Marc Gales, chief executive officer of Group Lotus, said: 'We understand the concerns that this proposal will create. We deeply regret the potential impact any reshaping of the business may have on our employees and their families. 'We have worked very hard to avoid the need to make the proposal, but do believe that it is now essential. It is in no way a reflection on our employees who have shown nothing but dedication to us and have worked tirelessly to support Lotus.'

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Group Lotus will now consult with staff and workers' representatives on the proposed changes and on ways and means of avoiding job losses, reducing the number of job losses and mitigating the impact of any changes that are necessary.

Mr Gales added: 'Once the reshaping has been undertaken, and with its strong and experienced management team, Lotus should be a leaner, more competitive organisation, focusing on both producing class-leading sports cars and innovative engineering.

'We will also build upon the improved sales results seen over the last few months.'

South Norfolk MP Richard Bacon said: 'Group Lotus has made significant progress in the last twelve months, so this will come as bitter news for the employees, who have been working hard and successfully to deliver better results in a very competitive environment. I understand that the company is going through a major reshaping process in order to become more sustainable for the future. The harsh truth is that if Lotus is to prosper in the long term it must do even better, at lower cost.

'I have spoken to the Business Secretary Vince Cable and also to the Work and Pensions Secretary Iain Duncan Smith to ask for every possible help from government at this difficult time.

'Both ministers have promised me that the government will take every possible step to minimise the effects of today's announcement.

'The government does have some funding available through its Talent Retention Scheme to help with the retention of skilled jobs and I have been assured that the Department for Business will be exploring this with the company.

'The government also has an experienced rapid reaction team which helps those facing redundancy to get back into work quickly. I have asked for this team to be deployed immediately and the Department for Work and Pensions assures me that this is already happening. All possible avenues will be explored to retain as many jobs as possible and, where needed, to help people with finding new jobs.

'I have also spoken to both South Norfolk Council and Norfolk County Council, who are committed to providing local help where ever possible.'

The famous Lotus name was formed by engineer Colin Chapman in 1952 as Lotus Engineering Ltd.

His first factory was in Hornsey, North London, but the firm moved from the capital to Hethel, near Wymondham in 1966 on the site of a former second world war airfield.

Team Lotus, which was split off from Lotus Engineering in 1954, was active and competitive in Formula One racing from 1958 to 1994.

The Lotus Group of Companies was formed in 1959 and created iconic cars such as the Elise and Esprit.

Chapman died of a heart attack in 1982 at the age of 54, having begun life an innkeeper's son and ended a multi-millionaire industrialist.

The car maker built tens of thousands of successful racing and road cars and won the Formula One World Championship seven times.

In 1986, the company was bought by General Motors. On August 27 1993, GM sold the company, for £30m, to A.C.B.N. Holdings S.A. of Luxembourg, a company controlled by Italian businessman Romano Artioli.

In 1996, a majority share in Lotus was sold to Proton, a Malaysian car company listed on the Kuala Lumpur Stock Exchange.

The company also acts as an engineering consultancy, providing engineering development — particularly of suspension — for other car manufacturers.

The company is organised as Group Lotus plc, which is divided into Lotus Cars and Lotus Engineering.

The company was successful with a £10m Regional Growth Fund application from the government in 2011 to expand its Hethel site.

More recently, the EDP reported earlier this year that a surging global appetite for Lotus cars was fuelling sales for the iconic Norfolk firm –helping to accelerate its journey back into the motoring fast lane.

Bosses hailed a 31pc rise in global sports car sales for the first three months of the year.

The EDP Top100 firm sold 505 Norfolk-made cars between April 1 and June 30 – compared to 386 during the same period last year.

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