Chinese-backed carmaker Lotus ‘studying’ US factory

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Lotus is “studying” plans to open a US factory as the Chinese-backed carmaker seeks to expand production beyond its UK homebase.

The plant will be the third for the Norfolk-based sports car brand, after its owner Geely funded a factory in the Chinese city of Wuhan to produce Lotus’ first core electric model, the Elettre. The Wuhan plant, which opened this year, has a capacity of 150,000 cars per year.

“We want to expand our capabilities elsewhere,” Lotus Group CEO Qingfeng Feng said on the sidelines of the Goodwood Festival of Speed ​​on Thursday. He said the company is “studying” US options along with other potential countries. A decision is likely to be taken before the end of the year.

A US site would mark the scale of the transformation for a brand which for decades built only hand-built sports cars in the East Anglian town of Norwich, 160km north-east of London. Geely, which acquired a 51 per cent stake in the company in 2017, has invested more than £3bn in the British carmaker.

Lotus may opt for a production plant in South Carolina similar to the Geely-backed Volvo Cars. Polestar, an EV brand owned by Volvo and Geely, is already adding a line to a South Carolina site to make electric vehicles. But Lotus could also consider an entirely new US site if the country chooses, Feng said.

The company’s chief commercial officer Mike Johnstone said Lotus expects to sell 150,000 cars by 2028, a level that will overtake the Wuhan facility, which opened this year.

While Lotus models are too expensive to benefit from the green incentives offered under the US Inflation Reduction Act, setting up in the country would bring Lotus closer to a key market.

It sells only a handful of models in the US, Johnson said, but wants that market — which is the largest sports and luxury market globally — to account for a third of sales.

The carmaker is expected to list shares through a reverse merger with LVMH-backed investment group “L Catterton Asia Acquisition Corp” by the end of the year. Feng said the company was “on track” with the listing despite conditions in global markets.

The list is exclusive to Lotus’ newly formed EV division, which also includes a Chinese factory to try to achieve higher valuations. The business has the option to incorporate the UK sports car unit into the listed business after the deal is completed, Feng said.

“We are achieving all our targets,” he said, adding that the listing will enhance the brand’s reputation globally, as well as help the business become “healthy”.