McLaren prioritises profitability over electric cars
Long-mooted McLaren SUV would only become a reality after 2028
CEO Michael Leiters says 2023 will be “difficult”, and firm must become “robust”
McLaren will look to extend its range beyond its core mid-engined supercar models - but not before 2028.
Speaking at Autocar at the Goodwood Festival of Speed, McLaren CEO Michael Leiters said the firm’s immediate priorities were to complete a reorganisation and recapitalisation of the company “to bring the company on the right road to profitability” when asked how plans for a long-rumoured crossover model were progressing.
“If we are on the right road for profitability, we will think about extension across all segments. We call it ‘shared performance’. Shared performance could be everything which has more than two doors and/or more than two seats.
‘This is something we will think about later. We didn't make a decision on that. It's definitely a business opportunity for us. But I don't see that in the near future. If you consider what I said - recapitalisation and then going to profitability plus the development time [of the car] - this won't be before 2028.”
Leiters is just over a year into his role at McLaren, and has spent much of his time since reorganising the company’s internal structure. The focus is now on working with existing shareholders “to recapitalise the company to fund and restructure” to allow it to return to profitability, the shareholders “aligned with this vision and business plan”.
While this work is ongoing, “2023 will be a difficult year” for revenues and profitability, as in parallel to this structure and finance work Leiters is working on improving the quality of McLaren car that means its Woking factory is not working at full capacity.
The McLaren Artura hybrid supercar has not yet fully reached its full production capacity, Leiters said, admitting that this will cause customer delays, including to the US launch. However, this was important “as the Artura is a fantastic car, and we don’t want to damage the image by taking risks” in delivering cars not at the required quality. “We still have to ‘robust’ our organisation and supply chain on that.” Some 500 Arturas had been delivered to date.
The 720S-replacing 750S is in the ramp up phase now towards production, with the first deliveries expected at the end of this year. The car is already sold out to the end of 2024.
Leiters believes these two cars sit together far better in McLaren’s range than anything previously as they have clear positioning and differences, both in terms of cylinder count (the Artura is a V6, the 750S a V8) and a technology (the former is hybrid, the latter pure ICE).
These two models will be McLaren’s core range until the proposed 2028 expansion, and Leiters believes that the firm can still grow in the supercar market, not necessarily through volume but with increased pricing and “more specials”.
On future electric models in its supercar range, Leieters said there were three pillars to the firm’s line-up and future plans: pure internal combustion engined models, hybrids and EVs. The 750S and Artura sit in the first two pillars respectively, with Leiter saying he expects hybrids to make up 90% of McLaren volumes in five years.
On EVS, he said the firm “did not want to do a car weighing 2000kg and with 2000bhp as anyone can do that” and instead if it was to launch an electric car it would have to be “comparable to a 750S weight wise”. He added: “We are working on concepts and have really exciting ideas around that, and if in time it is there it has to outperform what we can do with ICE.” That last comment not only refers to performance but also how the car drives, and the emotional experience for the driver.
-Q&A, Michael Leiters, CEO McLaren-
*Are any of your customers asking for electric cars?*
“No, but we have to be careful. Times are changing and we have to prepare for new times. The success of 750S shows our customers love ICE cars, but maybe there are other customers and they’re interested in other stuff. Today is not the time for that but maybe at the end of the decade.”
*Does regulation force you towards EVs?*
“Regulation in the past has been positive for innovation when it has been purposeful and open for all technologies. Then you have to consider the consumer; if you go against them you won’t be successful. I’m very happy about the opening of proposals for E-fuels. I’m not saying they’re the solution but they’re a strong signal we’re coming to a technology neutral discussion. EV, e-fuels, hydrogen: whatever you use, they are young and fresh so who knows the full potential of them and why do we believe only one technology can cover all use cases?”
*Will you move more to names of cars like Artura rather than alphanumerical names like 750S?*
“[smiles] We will explain to you when we do the next model.”