Group Lotus could see big investment following Geely takeover, industry expert says
- Credit: Copyright: Archant 2016
A Chinese takeover of a Norfolk sports car maker is a sign of confidence in the UK's manufacturing sector, an industry expert has said.
A majority stake in Group Lotus has been bought by Chinese automotive giant Zhejiang Geely Group, owner of Volvo Cars.
With Geely's record of investment in Volvo, which has remained in Sweden, there is hope the future could hold a similar fate for Hethel-based manufacturer Lotus.
Mark Henry, head of law firm Birketts' automotive industry group, said he thought the deal could follow similar foreign buyouts at other brands.
He said: 'Looking at how things have worked at Volvo, they have been allowed to get on with it and have retained their identity whilst being given the investment that has allowed them to be resurgent.
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'Whether it is Jaguar Land Rover (JLR) with Indian ownership or Aston Martin, which has just posted their first quarter results which show they are in profit for the first time in a little while, or Mini and BMW, British car makers are doing well from foreign investment.
'There is a very strong market for British brands in the Far East.
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'I think there will be more investment in Norfolk and sales at Lotus will bring more jobs and prosperity to the Norfolk economy.'
He said Tata, which bought JLR in 2008, had ploughed profits back into the business and hoped something similar would be done at Lotus.
With Lotus being a specialist car manufacturer rather than a mass producer Mr Henry said being a British name would appeal in the Far East and Geely could help it reach new markets outside China.
Mr Henry said: 'The Chinese market is going to be the biggest growth market in the world in terms of consumers.
'Companies like Geely have tremendously deep pockets which is one part of the equation, they have access to China, but they also are looking to grow into new markets.
'I am not sure Lotus will be a mass volume brand, they will be going for that premier market and for them it will give them access to markets from a base of China.'
Volvo is working to produce its first fully electric car, which is being built in China, and Mr Henry said we would have to wait to see if there will be collaboration with Lotus.