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Lotus is planning to end production in the UK in more than 70 years and risk 1,300 jobs to the latest automotive industry.
The British sports car maker, dominated by Chinese automaker Geely, has struggled to pay its suppliers in recent weeks, according to two people with debate knowledge that it temporarily halted production at its Hessel plant in Norfolk for about a month.
The loss-making company plans to close production soon next year at its factory, the only manufacturing base in the UK.
In a statement from the Financial Times, Lotus said it had suspended production since mid-May to manage inventory amid supply chain issues related to US tariffs. Matt Windle, head of the company and Lotuscar Europe, declined to comment further on the “rumorrows.” Geely declined to comment.
Geely acquired a 51% stake in Lotus in 2017 as part of an agreement to invest in Malaysian owner Proton.
Geely’s investment was then considered the lifeline of a company founded in London in 1948 after years of loss. The Chinese group has invested around £3 billion in new technology and factory equipment, but switched focus to new factory in Wuhan.
Last year, the Chinese Automobile Group listed Lotus Technology (the branded electric vehicle business) in the US through a merger with a Shell company founded by an investment group backed by LVMH. In April, Lotus Technology said it would buy a 51% stake in the UK business Geely after the Chinese company exercised its option to sell its shares.
In the April-June quarter, Lotus Technology reported an operating loss of $133 million compared to a loss of $233 million from the previous year, but reduced its 1,274 vehicles by 42%.
Li Shufu, the founder of Geely’s billionaire, who also owns Volvo Cars and Polestar, has taken down his global assets since last year and streamlined his core business.
With the help of Geely, Lotus has been trying to revive historic British brand for many years, but struggled to pivot to high-end EVs. As a result, a series of management teams were changed, and Windle took over as chief of Europe in May after his predecessor, Dunballmer, left less than a year later. Chief Executive Mike Johnson also left the company in 2024.
Since its IPO last February, Lotus Technology shares have collapsed 84%. Stocks fell by 8.5% on Friday after a Financial Times report.
The end of production at the Heter plant, founded by Lotus in 1966, will further damage British car production, following other closures by Honda and Ford over the past decade.
British vehicle production collapsed to its lowest level since May 1949 in 1949, after Donald Trump’s tariff war caused Aston Martin and other British automakers to halt transportation to the US.
