General Motors Corp. is taking over Britain's Group Lotus, an internationally known engineering and race-car development company, GM and Lotus officials announced yesterday.
GM is paying the U.S. equivalent of $20 million, or $1.82 a share, to acquire 59.7 percent of the Lotus operation and intends to buy out the entire company at the same per-share rate, GM officials said.
However, Toyota Motor Corp., Japan's largest auto maker, owns 21.5 percent of Lotus, and it was uncertain yesterday whether Toyota would sell its shares to GM.
"We will be discussing with Toyota the possibility of purchasing their shares," said Ronald Theis, GM's international spokesman.
GM and Toyota operate a joint-venture car company, New United Motor Manufacturing Inc., in Fremont, Calif. But Theis said that the GM-Toyota relationship in the United States does not affect GM's attempts to acquire all of Lotus.
GM said it teamed up with Toyota in this country to develop expertise in building quality small cars at lower production costs. GM is taking over Lotus to acquire more automotive expertise -- this time in building high-performance cars that can compete with the likes of Porsche.
GM officials, who are wary of discussing product plans, don't like to put it that way. But for some time now, it has been an open secret in the domestic auto industry that GM's leaders are worried about holding on to its share of the so-called high end of the domestic car market in the face of competition from nameplates such as Audi, BMW, Jaguar, Mercedes-Benz and Porsche and a host of new high-performance entries from Japan.
The high-performance competition is even heating up in the market for less-expensive cars, according to Ward's Auto World, an industry magazine based in Detroit. And there, too, GM is running into fast traffic, the magazine said.
"Although numerous auto makers already have -- or shortly will -- offer such trendy technical innovations as 4-valves-per-cylinder engines and 4-wheel-drive passenger cars, this technology is still lacking in General Motors Corp. production cars," the magazine said.
"As by far the world's largest auto maker and historically a technological leader, GM is criticized in some quarters for failing to keep pace with -- let alone stay ahead of -- lesser lights in applying new ideas to cars people can buy," the magazine said.
GM officials call the criticism ill-founded. The acquisition of Lotus, which produces only about 1,000 cars a year, is designed to help GM maintain its lead in automotive technology, Theis said. "Lotus' forte is engineering expertise. They're doing a lot of work in composite materials, aerodynamics and vehicle dynamics," he said, adding that Lotus' contributions probably will show up in all future GM cars.
Meanwhile in Frankfurt, GM said yesterday that it will set up a European head office in Zurich in a comprehensive restructuring aimed at coordinating passenger car operations in the region, Reuters news service reported.
The company said in a statement that the move would not change the legal or business status of GM's present national subsidiaries but would be a catalyst, coordinating planning and production through 17 European countries.
[Ferdinand Beickler, 63, will give up his duties as chief of GM's West German Opel subsidiary to head the Zurich office, Reuters said.]