Photo/Zhang Jian (NBD)

Recently, the website of China Securities Regulatory Commission disclosed the notice of filing for the overseas issuance and listing of Lotus Technology Inc. If the listing goes smoothly, this will be another listed company under Zhejiang Geely Holding Group.

According to the disclosed information, Wuhan Lotus Technology Co., Ltd., the domestic operating entity of Lotus Technology, will merge with L Catterton Asia Acquisition Corp (LCAA), a special purpose acquisition company overseas, to list on Nasdaq in the United States, issuing no more than 181 million common shares.

Automotive News Europe previously reported that Lotus’s chief commercial officer Mike Johnstone revealed that Lotus plans to land on Nasdaq by the end of March. Previously, the company’s expected listing time was the end of last year, and Lotus did not respond to the delay.

According to the documents previously announced, Lotus Technology is expected to be valued about 5.4 billion US dollars after merging with LCAA. Lotus Technology plans to use the proceedings to accelerate product innovation, develop new-generation automotive technology, expand the global distribution network, and corporate daily operations.

Lotus was acquired by Zhejiang Geely Holding Group in 2017 and announced a 10-year brand revival plan called Vision80 in 2018, which aims to transform the company into a fully electric and intelligent luxury brand. Lotus has launched several electric models, including the hypercar Evija, the hyper SUV Eletre, and the super sedan Emeya. It also plans to introduce a mid-sized SUV in 2026.

However, Lotus faces many challenges in its revival journey. 2023 is the first year of delivery for its first mass-produced model Eletre in China, and the decisive year for its Vision80 plan. The company’s market performance is still lagging behind other luxury brands such as Porsche, but it has shown significant improvement. Lotus received about 17,000 orders globally in the first half of 2023, compared to only 576 units sold in 2022. In the domestic market, about 3,000 Lotus were insured in 2023. In comparison, Porsche’s electric sports car Taycan sold 40,000 units worldwide last year.

Photo/Huang Xinxu (NBD)

To boost sales, Lotus also engaged in a price war by launching a cheaper entry-level version of Eletre and lowering the starting price of Emeya to 668,000 yuan.

Public data shows that the company suffered pre-tax losses of 86.6 million pounds and 145 million pounds in 2021 and 2022, respectively. Lotus cut about 200 jobs in July last year to reduce operating costs.

According to Lotus’s forecast, the company expects to increase its revenue by more than three times to $8.5 billion to $8.9 billion by 2025, and its gross profit by more than four times to $1.8 billion to $2 billion, with a gross margin of over 20%.

Some industry insiders believe that going public in the US can provide Lotus with more capital and financing channels to support its transformation and growth. The IPO is an opportunity for Lotus to compete in the fierce automotive market and lead the industry towards a more sustainable future.