The Lotus F1 Team found themselves in court on Monday. The team has complained publicly about the unfair money situation in the modern Formula One and have made their current financial situation public. It’s no secret that the team is struggling with cash flow issues. Unfortunately, these issues have caused to the team to run up a rather expensive tab with their suppliers. This has landed them in court.
Xtrac Limited, an automobile transmission manufacturer that supplies gearbox components to the Lotus F1 Team, was one of the multiple suppliers which filed a complaint against the team. The case went to court on Monday, where the judge adjourned the case for two weeks. During these two weeks, the two parties are supposed to attempt to resolve the issue outside of court. If this is unsuccessful, the two companies will have to return to court. If this happens, there is a risk that the team will be forced to enter administration.
Xtrac has a long term relationship with the team and hopes that this legal issue will not hinder this relationship. The team’s debt is simply needs to be reduced. “The judge has adjourned the hearing for two weeks. This is in order to allow further dialogue during which we will continue to discuss all the options for resolution with Lotus F1,” a spokesman from Xtrac told Racing Clothesline. “Throughout the past 15 months, Xtrac has manufactured a significant quantity of parts in good faith to ensure the cars can keep running. We have enjoyed a long standing relationship with Lotus F1 and its management, and we hope to resume this once the now significant debt has been reduced and a positive outcome agreed.”
The Lotus F1 Team seems to be relaxed about the issue. “A number of suppliers are feeling a little negative because of what happened to Caterham and Marussia, and they felt they had to go down this process,” Lotus CEO, Matthew Carter, told the press. “We’ve had dealings and agreements with the companies that are taking part in the process, and it’s being dealt with in a normal way. It’s been adjourned while we deal with it, and we always knew it was going to be adjourned. There are a couple of suppliers using it to try and claim monies that aren’t owed, and that’s obviously being dealt with as well.”
With two teams, Caterham and Marussia, having been in this same position last season, there is a growing concern about the future of the Lotus F1 Team. Both Caterham and Marussia have since disbanded because of their financial instability and it would appear that Lotus is heading down a similar path. Cater feels that this issue will pose no threat to the future of the team, stating: “It’s perfectly under control. It is just part of the process.”
