Bob Lutz was being optimistic at 60% chance of success. Lets make it 90%

 A happy and healthy New Year to everyone.

In a recent Telegraph interview Dany Bahar was interviewed on the future of Lotus

Bahar wants the engineering side to create at least one third of the company’s profits in future, with the other two thirds coming from building 6,000-7,000 road cars a year.

“In future we will be fighting in every sports car sector,” he says.

I'm not an accountant. So I have kept this real simple.

7000 units x 100,000 plus pounds average saleable value per vehicle  =  800,000,000 Pounds total 

So using these figures,Lotus can expect to achieve a total revenue of 0.8 Billion pounds per year on car sales

Assuming Lotus covers its R&D costs by 2015 and achieves a profit margin of 25% per car. Lotus can expect approx 0.2 Billion pounds profit per year...Add 0.1 Billion profit from Engineering services.

 Compare this to Phoenix (virtual) University figures for 2010.
Here is a portion of their financials for 2010.
OutlookFor the full year, analysts expect Apollo to grow revenue 23.3% to $4.9 billion. Earnings should exceed $5 per share and grow approximately 20%.

So the present Lotus plan has a potential of  generating revenue of 1.2 billion pounds per year.

The University idea has a potential revenueof ($4.9billion)3.1 billion pounds using official  Phoenix figures as a benchmark.

I don't envisage the University having a 25% profit margin. I would hope however, over time, to have 1 million customers as opposed to the half a million that Phoenix has presently.

I would expect a truly global customer base.

Assuming an eventual customer base of 1 million students globally a 6 billion pound revenue stream would be possible:

Using a 10% profit margin for the University:


Yearly Profit for Virtual University: 600 Million pounds


Using a 25% profit margin for the present Lotus plan:

Yearly Profit for present Lotus plan: 300 Million pounds

The present plan only represents the tip of the iceberg... Look deeper

In my humble opinion adding a virtual University to the plan raises the chances of success from an optimistic 60% (Bob Lutz) to a realistic 90%.

BTW: The British OU celebrates its 40th birthday on the 3rd January. Congratulations!