Formula 1 and other stuff

Group Lotus has made a lot of announcements this week. It issued concept sketches for a bunch of new race cars, including an LMP2 coupé designed by Paulo Catone, who engineered the Le Mans-winning Peugeot 908 (hang on a minute, though – isn’t LMP2 becoming a cost-capped formula for privateers, hmmm?).

The forthcoming Lotus Elite

Today at the Paris Motor Show it will officially unveil five* new road car models that go some way beyond its traditional two-seater sportscar model, and which establish a new design language courtesy of incoming ex-Ferrari stylist Donato Coco. They will roll out between 2013 and 2015. There’s the Elite, a mid-engined 2+2 with the option of a Toyota-derived hybrid powertrain. There are new versions of the Elan and Elise, plus the rebirth of the Esprit, which will take on the Ferrari 458 Italia. There’s also a four-door called the Eterne, which targets the Porsche Panamera…

So where’s the money coming from for this new model splurge? Before recruiting CEO Dany Bahar from Ferrari, Proton, the owner of Group Lotus, decided on a strategy which others less delicate than I would call “shit or bust”: either sell it off or make it finally live up to its potential.

Fair enough – but, yes, where’s the money coming from? Proton isn’t exactly flush, and Lotus recently applied for a loan from the UK Government which it did not get (what do you expect from a Prime Minister who’s never had a proper job?).

While we’re at it – where and how are these products going to be made? Whence are the raw materials going to be sourced and paid for? Who will build the cars, and where? Some aspects of this great whoosh of announcements will disturb those who remember the dying days of another well-known British car manufacturer.

Lotus LMP2 coupé concept

Ten years ago MG Rover had a similar new model push: there was an LMP2 equivalent (then called LMP675), a new city car and a new high-end sportscar. The difference then was that the expansion came through partnership and/or acquisitions: the MG-badged LMP675 was done with Lola, the Cityrover was acquired from Tata and the MG XPower SV was a (hideously) facelifted Qvale Mangusta. MG Rover needed a quick fix that these products didn’t deliver.

Still, there are reasons for optimism: a venerable motoring scribe recently visited the Group Lotus base and was reportedly blown away by what he saw. Some of these new models will not be built until the middle of the decade, so there is no requirement for an immediate five-fold increase in manufacturing capacity. Today’s announcement is a land grab for headlines and a bold statement of intent.

Tucked away in the small print is another telling detail: Lotus will scale down its dealer network to offer better service and a more exclusive face. As much as anything else, today is about reclaiming the brand and the famous badge with the ACBC initials, but also beginning a process of rehabilitation – consigning the epithet Lots Of Trouble, Usually Serious to the dustbin of history.

What’s in a badge?

Yesterday’s revelation that the simmering tension between Lotus Racing and Group Lotus exploded into outright rancour over the seemingly trivial issue of t-shirts cuts right to the heart of this issue. What’s in a name? What, indeed, is in a badge?

You may equally say – why can’t they just get along?

Anyone who works in the marketing industry or its tertiary sectors will tell you that branding is all about control. Every major company has strict guidelines about colour palettes, font families and the size, shape and alignment of the logo. When you produce marketing materials on behalf of these brands you either stick to these guidelines or you have your homework thrown back at you along with a curt instruction to do it again, properly.

By his own admission, Dany Bahar is not a “car guy”. But he knows about brands, and having a bunch of clowns running off t-shirts, baseball caps, posters, etc (let alone a whole Formula 1 team) off the back of “his” brand must have made him apoplectic. For here’s another unspoken truth about the branding industry: it’s the home of not-invented-here syndrome. To any branding wonk from a multinational corporation, anything produced by an outside body (especially when unauthorised) is automatically bad, even if it’s good. Only the best agencies get over this hurdle.

While we’re in the market for truths, here’s another one that governs the car industry: show, don’t tell. You can throw money at branding and seductive advertisements, but the success of a car manufacturer is measured in sales. That means, in no particular order: having a compelling product; having a product that doesn’t start falling apart the moment it leaves the showroom; and having dealers who don’t treat the customer like a dead shrew that the cat dumped at the bottom of the stairs.

Can Lotus deliver all of these? It will have to.

*There was a sixth kicking about, a city car, but it wasn’t part of the main reveal.

Besides being a talented and visionary engineer, Anthony Colin Bruce Chapman was as wide as the day is long. It would probably have amused him – he may even be having a giggle with Elvis Presley right now as they sip daiquiris by the poolside in Peru – to see a pair of similarly sharp businessmen handbagging each other over their conflicting claims to the Team Lotus legacy.

Lotus: a burnt offering? Photo by Darren Heath

In the green corner we have Dany Bahar, a former branding wonk at Red Bull and Ferrari, who became CEO of Group Lotus last September. In the other green corner we have Tony Fernandes, a former high flyer in the music business who realised that September 11, 2001 was a great day to buy a failing airline (this he did, snapping up Air Asia from the Malaysian government for one ringgit). In the middle we have an utter failure to understand the complex nature of the Lotus business.

Team Lotus was always a separate entity from the road car business, in part because it enabled Chapman and his accountant, Fred Bushell, to play which-shell-is-the-peanut-under with HMRC and sundry other creditors. The picture was complicated after Chapman’s death in 1982, when the team carried on racing under its own auspices and the Group was sold to General Motors.

As a result of the GM sale, the Lotus brand was subjected to some hideous contortions, perhaps the nadir of which was the Isuzu Piazza, a hideous contraption that bore decals proclaiming “Handling By Lotus”. I once walked all the way round one expecting to find a similar badge advertising “Styling By David Blunkett”.

Even when Chapman was alive, ownership of a Lotus car was a labour of love in which sublime handling prowess and pleasant styling were offset by dreadful reliability – to the extent that owners joked the Lotus name actually stood for Lots Of Trouble, Usually Serious. Quality has improved in the interim, but Lotus – now owned by Proton, and still having to act as an engineering consultancy as well as a car maker to make ends meet – still has a long way to go before it can liken itself to Ferrari. Plenty of niche sportscar makers aspire to be as big as Ferrari, but most of them go bust along the way (don’t believe me? Call a medium and ask them to put you in touch with Ferruccio Lamborghini).

When Team Lotus collapsed at the end of 1994, David Hunt (brother of James) and a business partner took on the assets, such as they were. The only thing of value was the (trademarked) name, and Hunt has been trying to maintain that value ever since, including several attempts to bring it back into F1.

In 2002 David Richards let it be known that he was looking to rebrand the BAR team. As a jolly editorial wheeze, the magazine I was working on at the time invited its readers to send in their suggestions… and we were somewhat surprised to receive a high volume of identically phrased letters and emails suggesting that DR change the name to Team Lotus. Who was behind this? Step forward Mr Hunt…

(Parenthetically, by September that year we had a hot tip as to what the name was actually going to be. I was dispatched to Monza with instructions to secure an interview with DR, and then in the midst of the usual process of things hit him with our ‘scoop’ to see if it got a reaction. That it did: he hooted with laughter, told me it was a stupid name and that it sounded more like a brand of lavatory disinfectant. A couple of months later the rebrand was announced: instead of BAR it would be known as B.A.R, with the dots aligned with the centre of the letters rather than the bottom. How much do you reckon they had to pay a consultant for that piece of work?)

As Dietrich Mateschitz’s right-hand man, the ambitious Bahar had nowhere left to go in the Red Bull business. When he left for Ferrari, the word on the street was that he had been coveting Christian Horner’s position as team principal of the F1 team, and having failed to secure that he was hoping to slot into the succession at Maranello. Unfortunately he came in as Jean Todt’s man just as Todt was on his way out…

By the time Bahar’s feet were under the table at Group Lotus, in September 2009, Tony Fernandes had concluded a multi-year licencing deal to use the Lotus Racing name in F1, having failed to do a deal with Hunt to run as Team Lotus. Bahar knew that to fulfil his ambitions to turn Lotus into a properly multi-national behemoth to rival Ferrari, he needed to be in F1 – trouble is, Fernandes got there first.

So over the past few months there has been much manoeuvring behind the scenes. Bahar has been attempting to register various permutations of the Lotus name as trademarks. Fernandes, aware of his tenuous grip on the Lotus Racing name, has made sure that it was he rather than Group Lotus who clinched a deal with Hunt for the prized name – and logo – of Team Lotus. He managed it in the nick of time, for Group Lotus recently annuled the licencing deal. A more vivid picture of all the goings-on emerged when the 2011 GP2 teams were announced, featuring a Lotus-branded team run by ART in partnership with Group Lotus – and a Fernandes-owned team running as Air Asia.

Today the owner of Group Lotus, Proton, has weighed in to the battle. It issued a statement that amounts to a cease-and-desist notice, threatening dire levels of legal buggeration if Fernandes carries on using the Team Lotus name:

Tony Fernandes has no rights to use the Lotus brand in the 2011 Formula 1 season, and we will strongly resist any attempts by him to use our brand without our permission and will withdraw our sponsorship of the Lotus Racing team.

To put it simply, Group Lotus is everything Lotus. The fact that 1 Malaysia Racing Team entered into an agreement with Group Lotus to use the brand means that both Mr. Fernandes and 1 Malaysia Racing Team recognises and acknowledges Group Lotus’ rights.

Oh what a tangled web they weave. But is the brand and the badge, with the fabled intitials of Anthony Colin Bruce Chapman, really worth all the hoo-ha?

The situation bears amusing similarities with the sorry saga of Bucks Fizz, the pop act that won the Eurovision Song Contest in 1982. By the mid-1990s two of the original four members had retired from the touring scene, and the remaining pair recruited another couple to replace them.

“Musical differences” and general rancour ensued, which ultimately resulted in them going their separate ways – each recruiting two more members and attempting to tour the UK under the Bucks Fizz name. Summing up in the messy court case that followed, a weary judge attempted to amuse himself by informing the combatants that over 15 years after the heyday of Bucks Fizz, “the fizz has rather gone out of it.”

Will Bahar or Fernandes back down, or will it go to court? Well, to quote the popular maxim – also co-opted by Bucks Fizz for a minor hit – If You Can’t Stand The Heat, Stay Out Of The Kitchen…