Once upon a time there was a racing team called Team Lotus. It went out of business in the early 1990s and that was the last that was heard of it, until a bunch of Malaysians decided it would be a great idea to have another Team Lotus and the government (which owns the name) agreed to let them try to revive the name. In a rather eccentric fashion, they then decided to let another group take over Group Lotus, with a strategic plan to use motorsport to promote the brand. Thus began the Team Lotus versus Group Lotus battle. It has been utterly confusing for everyone, not least on the ground in F1 where there is a team called Lotus Renault GP (LRGP) and another called Team Lotus. To further complicate matters both use Renault engines.
One lot had a green car and the other lot a black car. Some call them “Good Lotus” and “Bad Lotus”, some call them “Lotus” and “Louts”. Most spectators cannot figure out which is which, and do not really care.
Team Lotus is relatively easy to understand. It is owned by Tony Fernandes and a number of his partners, who prefer to be under the radar. The other team is rather more complicated. This is the former Renault F1 team, which runs cars called Renaults. It is owned by a company called GenII Capital, which involves some investors from Luxembourg, who include Gerard Lopez and Eric Lux. They acquired the team by buying it from Renault, using money which was loaned to them by Renault’s bank!
When the bank wanted the money back (as they do) Lopez borrowed from a different bank and so found himself in debt to a man called Vladimir Antonov, who is a Russian. Antonov does not want to own a Formula 1 team (or so he says) and he is simply in the business to make money. Thus he wants Lopez to pay him back. At the same time Lopez signed a sponsorship agreement with Group Lotus, run by a man called Dany Bahar, a silver-tongued salesman who convinced the Malaysians to let him build an automotive utopia, in an industrial estate just south of Norwich.
Lopez put Bahar on the board on his team, on the basis that Lotus would be the team’s title sponsor for five years. However, this deal was later delayed for a year because someone said something that upset somebody and so the big bucks (borrowed by Bahar from Asian banks) did not start appearing at LRGP when they should have. To avoid any red faces, the cars have stayed black and gold. The problem is that this left the team short of cash as a result. The promising chassis has been largely wasted because Robert Kubica hurt himself and Nick Heidfeld had too small feet to fill the Pole’s empty boots. Vitaly Petrov said little, brought money from Russia and did OK.
Lopez has since been looking for money from a partner who is willing to let him do his thing in B2Bbut has yet to come up with a solution. He needs to pay to Antonov to stop the Russian taking control of the shares at some point in the increasingly less distant future. The word is that Lopez has prepared a suitable parachute for himself andf has given Bahar an option to buy the team if things get bad. Bahar is also smart enough to have acquired an option to buy it from Antonov. However, Bahar has been spending an awful lot of money in his quest to make Group Lotus shiny and new and that ha worried the folks at Proton, the organisation that owns Group Lotus. They are worried that Bahar is spending too much and want him to scale back on his wildly ambitious schemes. This may explain why his plans in IndyCar racing seem to have evaporated and the number of cars in the new Lotus range may well start coming down quite soon. Not to mention the fact that no-one has thus far shown any desire to buy one of the Lotus Exos Type 125 mock F1 cars.
In the meantime, Fernandes has decided that Team Lotus is not the best brand for him and having got himself a 20 percent share of the national airline in Malaysia in exchange for giving up on his Lotus dream (a fair exchange for a guy who knows the airline industry best) and he is now concentrating his efforts on developing the Caterham brand, building small light cars for the traditional Casterhamisters in Europe and for the new middle classes of Asia. The advantage of this route is that Fernandes can create whatever brand values he likes for Caterham…
Even so, there are still lots of question marks. And one scenario which everyone seems to have forgotten about is the possibility that Lopez will actually find the money to go on with his plan to have a team to use to build up his commercial networking operation. If this business makes him lots of commissions and is successful, there really is no need to sell the team to anyone – and perhaps even no need to change the name of the cars.
One can imagine that of late Renault has been wondering whether it was such a great idea to sell its team when it did. That greatly reduced the company’s profile in F1. At the time this was seen as a good idea because Renault was in the F1 doghouse after the Singapore Scandal. Those involved were pushed overboard and Renault then scuttled its own ship by selling it to Lopez, expecting the name to go away as well. But two years later with Renaults still racing (and not very well) that idea does not seem as bright as it did back then. The team is a little embarrassing, not least because the new owners cannot change the name of the cars without losing a vast pile of money (based on clauses in the secret Concorde Agreement).
Renault still has a very successful programme in F1, but only the F1 anorak fans know which engines are in which cars. If ones does not know about the industry and look at a Red Bull, you would be forgiven for thinking that it is powered by an Infiniti engine. Most punters think that Lotuses have Lotus engines. In an effort to fix this problem Renault’s new deputy CEO Carlos Tavares did a deal with Williams to revive the well-known “Williams-Renault” brand, which harks back to wildly successful days in the 1990s. That will give Renault some more profile in the sport.
Tavares is a clever man and he may also be thinking about the value of having a team running in Renault yellow, with a car called a Renault. That is not really hard to achieve if one has a moderate-sized pile of money. That would help put the team back on the straight and narrow and give Renault back some more profile, without taking on the responsibilities that ownership entails. The French government, which owns 15 percent of Renault and has a lot more internal clout than the shareholding suggests, is also in a position to lean on big French companies and get them to help out. France has a great tradition in the sport, it has a great car industry but its involvement in F1 is moribund. And that makes no sense at all. The Prime Minister Francois Fillon has been made to understand this and it looks like we will soon have a French GP back on the F1 calendar – and perhaps a French team as well, with some French drivers…
So maybe after all these months of Lotus versus Lotus and other such distractions we might go into 2012 with one car called a Renault, the other called a Caterham – and no Lotuses at all.