The alarm was raised early Friday when multiple sources reported that Lotus’s Chinese owners had ordered preparations for the closure of the historic Hethel manufacturing facility in Norfolk, UK. A second source confirmed the bombshell, and the Financial Times reported that Hethel was indeed at risk, with up to 1,300 jobs potentially on the line. The reports suggested Lotus was seriously considering moving sports car production—especially the Emira—to the United States, a move that would mark the end of nearly 60 years of British production at Hethel.
The speculation was fueled by a temporary halt in production at Hethel, which began in mid-May. This pause was linked to new US tariffs on imported vehicles and components, which have hit Lotus particularly hard. The American market is crucial for Lotus, but US importers now face a 25% duty, making it difficult for the brand to compete on price. Lotus’s CEO, Feng Qingfeng, has openly discussed the feasibility of localizing production in the US to sidestep these tariffs and recover losses.
Despite these developments, Lotus issued a statement over the weekend to calm nerves: “Lotus Cars is continuing normal operations. There are no plans to close any factory.” The company emphasized that “the UK is the heart of the Lotus brand—home to our sports car manufacturing, global design centre, motorsport operations, and Lotus Engineering.” However, Lotus also admitted it is “actively exploring strategic options to enhance efficiency and ensure global competitiveness in an evolving market.”
The UK government has reportedly stepped in, with business secretary Jonathan Reynolds meeting Lotus management to discuss support for protecting British jobs. While no final decision has been made, the company’s move to cut costs—including laying off 270 workers at Hethel and closing its recently opened Clerkenwell headquarters—underscores the financial pressure Lotus is under. Sales have slumped, with a 42% drop in the first quarter of 2025, and the company posted a net loss of $183 million while debts have climbed to $3.3 billion.
One option being considered is shifting some production to Volvo’s under-utilised plant in South Carolina, as both brands are owned by Geely. This would allow Lotus to serve the US market more efficiently, avoiding tariffs and potentially stabilizing its finances.
In summary, while there is no immediate plan to close Hethel, the threat is real and under active discussion. The future of Lotus’s UK manufacturing base depends on how the company navigates tariffs, costs, and global demand in the coming months. For now, Hethel remains open, but the brand’s long-term commitment to British production is facing its toughest test in decades.