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    Will Gray

    Gray Matter: Is Caterham and F1 a perfect partnership?

    The announcement that minnow car maker Caterham has been bought by the management behind Team Lotus is an interesting one - but is it the right move for the parties concerned?

    Team Lotus boss Tony Fernandes set up his F1 team with a carefully thought-out business plan - to build profitable ventures off the back of the team itself. By securing the licence to use the Lotus brand, his plan appeared to be focused on connecting with the Proton-owned car manufacturer and steering its future.

    It is clear now that Group Lotus CEO Dany Bahar had other ideas and he has chosen to take Lotus Cars its own way, sponsoring the Renault F1 Team and joining ART Grand Prix to create a readymade motorsport ladder. Crucially, though, Bahar's business plan for Lotus appears to be focused on an increasingly premium product, with the aim of using success in Formula One to turn Lotus from a lower-budget sportscar manufacturer into one that can take on the top marques.

    Having had the licence to use the Lotus brand name taken away from him, Fernandes refused to give up and bought 'Team Lotus' - but with his right to that now being contested by Group Lotus, the Caterham connection is an extremely intelligent move.

    Caterham was, ironically, born out of Lotus. It started as a modifier of Lotus Sevens and it continues to sell that simple, lightweight and super-fast vehicle as its core product to this day.

    But over the last few years things have been changing. The original owners sold up and the new management has taken the company to new heights, expanding internationally and enjoying a record year of export sales in 2010 after working hard to meet the pan-European emissions standards they previously could not pass.

    It's the fifth year of consecutive export market growth for Caterham, and with Fernandes now in control the sensible plan would be to not only expand that European export focus into Asia but to develop a new product range that fills the low-budget sportscar gap which Lotus appears to be planning to vacate.

    The two aims are likely to be entwined, as the current Seven-based range, a car with no air conditioning and no doors or windows, may not necessarily suit a market where monsoon rains and high humidity are the norm. But the finances and business backing from Fernandes and his partners should enable the firm to turn it from a small and simple enthusiasts' car manufacturer to one with a range of more functional everyday sportscars created with the same philosophy. If that is indeed the plan.

    But why does F1 fit into this?

    The Caterham name is not a natural fit with modern-day F1, which has recently been all about the big-name manufacturers. Indeed, even the small marques like Spyker and Marussia have been all about high-end - but that does not bother Fernandes, and nor should it.

    Caterham is different. While 21st Century F1 is a different beast to what it was in yesteryear, it is still the world's most popular form of motorsport. And the Caterham brand breathes motorsport.

    Its one-make championship has been going more than 30 years and has become hugely successful across the world, with new championships being launched year after year. Now, the brand can go beyond its own series to boast a full motorsport programme that goes all the way up into GP2 and Formula One - and no doubt there will be plans to develop that too.

    Fernandes has not yet confirmed how he will use the Caterham name in F1 but he clearly will do so to the maximum he can. His marketing plans for Air Asia and Tune Group have been well considered and well developed, using not only F1 but other high profile sports to increase awareness. With F1, he has the perfect platform to expose what Caterham is all about - and if new products can come online quickly, that gives huge potential for growth.

    So, by buying Caterham, Fernandes has what he has always been looking for: a car manufacturer he can control and form into a successful low budget sportscar brand (after all, his business experience with Tune Group and Air Asia has always been about building low-budget brands) using a racing team as the primary platform.

    Lotus is a strong brand, but Caterham can become one on its own - and while Fernandes may be still fighting for the use of the Team Lotus name, if he wins the case then it will now likely serve only to enhance his plans for his big new business project.

    About Will Gray

    Award-winning sports journalist Will Gray has worked in and around Formula One for more than a decade, providing detailed technical insight as well as live news reports and features for newspapers such as the Daily Telegraph and Daily Star, AFP and Reuters news agencies and a variety of magazines. He has also worked as an F1 expert on TalkSPORT and Irish radio.

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