Q&A with Tony Fernandes

For Tony Fernandes, the announcement of the Caterham Group was all about one thing –
the future. And now that his team’s destiny is once again firmly in its own hands, he believes the sky really is the limit.

Take us back to the time you bought Caterham. Did you see the potential then or was it simply a means to an end – a way out of the battles with Group Lotus?

I’ve gone on record a few times about what we wanted to do with the Lotus name and how that whole process came to an end and, yes, it was deeply frustrating and confusing but it’s now in the past. For us it is all about looking forward from here, and the Caterham brand name has given us the best possible way of doing that across all of our platforms and in both the automotive and motor racing worlds.

Going back to when we first looked at Caterham as a possibility, the first thing I could see about the company is what a great job Ansar [Ali, Caterham Cars CEO] and his team had done to build the car company into a small but profitable outfit. What I liked about it then was that it was a brand with heritage and pedigree, almost to the degree that the Lotus name had. Also, it was a ‘clean’ company. It was debt free and there was no massive requirement for new capital. It really reminded me of AirAsia, which we took from a two-plane operation and built into a 100-plane operation in just 10 years. It struck me that we could do the same with this brand. It has huge potential.

With Team Lotus, I would have battled to the end if I felt it was the right thing to do, but when you take a dispassionate look at where we were it made absolute sense to start with a clean sheet, and Caterham has given us that chance.

It’s the best possible solution for where we want to go – partly because it gives us complete control over everything we do and, obviously, because there’s simply no point racing to promote a road car company I don’t own. The road car business has always been a sector I’ve wanted to explore and so here we are. But I can’t stress enough; this is a serious business venture for us. If I just needed a new name, I could have called it anything, but the synergy with Caterham works better – and it’s what I do – take a small business with the correct core values and purpose and expand it and grow it into the global marketplace.

When did you start seeing this as the way forward for the whole F1 programme?

Ansar’s approach came out of the blue, but owning a road car company has always been in the back of my mind. I think we have a much wider potential in motoring and motorsport than is represented by our F1 team.

As you know, underneath the F1 team sits Caterham Racing, our GP2 team, and then we have our driver development programme, which takes in a number of different series from karting, GP3, World Series by Renault and right up to F1. Some people also forget or don’t know that Caterham itself already has a long and proud history in motor racing – in fact, I think there’s some evidence that a Seven once competed in a grand prix! So, what we are doing is building on where the brand already is.

I think there are about 700 cars currently competing in various Caterham series around the world, so there is already a solid foundation there, but we want to forge a more comprehensive structure, something that brings drivers right through from the first steps in motor racing to, hopefully, standing on the steps of a grand prix podium.

We recently launched a Caterham race series in Asia – Ansar was with me for that last week – and my ambition is to have a ladder for talent, giving opportunities to drivers, engineers and mechanics. I want to develop talent right across the motorsport industry and give people the chance to learn, develop and reach the top. Obviously, that’s the noble aspiration and I’d be lying if I didn’t admit to some self-interest too. We want to grow all the sectors we’re putting in place; get the maximum out of them.

We want to build the road car division into something unique in the motor industry. We want to create affordable sports cars that remain true to Caterham’s philosophy of less is more but that also incorporate what we know from F1. Whether that’s KERS or better use of aero I don’t know for now – I’ll let the people at Caterham tell me how to do that, but what we are working on is very modern, affordable and, above all, innovative sports cars that provide a huge amount of bang for your buck. We do that in other industries we’re involved in and that’s what we want to do here.

The Caterham Group is a fairly ambitious plan, but it is a model other F1 teams, most notably McLaren, have sought to explore. Can you compete in that arena?

I think if you look at McLaren Ron Dennis has already set targets which state that by a certain point in time a certain percentage of the turnover of the McLaren group will come from the sale of road cars. That is also the business model we would like to develop – not in competition with them directly, as we are targeting a different customer segment – but it makes good business sense.

McLaren has made great strides in diversifying its business and I feel we should do the same. It just makes sense. You spend all this time, energy, money and brainpower developing incredible technology, what’s the point in restricting it to the race track. I think where we differ from McLaren, however, certainly in terms of road cars, is that whereas it’s a very rarefied segment they want to get involved in, we have a much more egalitarian approach. We want to bring this technology to the people. We democratised air travel with AirAsia and we want to the do the same in sports cars with Caterham.

In terms of technology, as I said, it would be foolish not to exploit what we develop. We’ll simply be looking to harness the brilliance we have at our disposal at Caterham Technology and Innovation and at Caterham Composites and apply that to industries we believe can benefit from it.

It’s also about making sure the F1 team can carry on and grow. When I started the F1 team I said this was not just going to be a passing fad; that we were going to be in this for the long term. Yes, together with my shareholders Din and Nasa, I financed the birth and early years of Lotus Racing and Team Lotus, but in order to protect the future of the team it needs to be a sustainable business. By expanding the group we can ensure that we can progress on a number of fronts and create a strong team that can survive and prosper in F1.

So what will give Caterham Group the edge? Is it the connection with the aerospace business etc?

My philosophy has, and always will be, that it is people that give you the edge. I remember saying in one of my very first interviews that it is people who make businesses successful, and that passionate, enthusiastic people are the reason great things are achieved. I still believe that, wholeheartedly. I feel we have built up a team of extremely special people with a good mix of experience, talent and fresh thinking, as well as being genuinely passionate about what they do.

Beyond that, experience in other sectors is beneficial to the group for a number of reasons. Yes, knowledge and learning can be transferred between these sectors, but it also inspires those experienced in each sector to re-evaluate their thinking and consider new ideas. That in itself is an incredibly valuable way of reinvigorating a business to produce class-leading products and services.

Caterham Technology and Innovation was launched in September and they are already working closely with Caterham Cars. They will also undertake advanced projects for external companies operating within the automotive and aerospace sectors. For example, they are currently working on the development of a radical new in-flight entertainment system and these are obviously areas I know a bit about – entertainment and aviation. It is through opening up markets such as that, where we have knowledge, expertise and contacts, that will give us a competitive edge.

Mike is heading up the Caterham Composites division. Mike has been in Formula One forever! Who better to lead a team specialising in that area? It’s all about giving people the opportunities and tools to grow and achieve what they are ultimately capable of.

So where does the group expansion leave the Formula One team. Are you still passionate about F1?

I am still incredibly passionate about Formula One, more than ever! I have always been proud of the fact that we’ve approached things a little bit differently and, when you do that, you put your heart, soul and personal reputation on the line. Sitting on the pit wall in Sao Paulo this year, I was so nervous about making sure we got that 10th place in the Constructors’ Championship again. If I stop getting butterflies ahead of each grand prix, then I’ll know it’s time to leave or step down.

The challenge is that I’ve got a lot of hats to wear now, with AirAsia, MAS, QPR, Tune Group and everything I am involved in all needing a bit of time every day, but each one is extremely important to me. I have fantastic people heading up each division of the business and I trust them to get on with their jobs and be successful but recently my role has really been about identifying the potential and the possibilities in each business, helping to develop the individual brands and then making sure that the right people are in the right positions to achieve the best results they possibly can.

I believe that there will be crossovers between these ventures, and it would be great to develop links between these areas – although I won’t be putting Joey Barton in a racing car or Heikki in a football team! Actually, thinking about it, I reckon Heikki might be quite handy… No, where it makes sense, there will be a transfer of knowledge and talent between individual companies and that will make us stronger as a group. The Caterham Group is something I’m very excited about and, under Riad’s guidance as CEO, I feel the company will gain strength and momentum as time goes on.

It seems, though, that in all the talk about the Group that the F1 team has been slightly overshadowed, becoming a cog in a larger profit-making machine. Is the F1 team still the jewel in the Caterham crown?

I think we need to look at F1 as being more than just a ‘racing team’. Actually, if we break down what Formula One really is, it’s about innovation. It’s about being the best, about being cutting edge and thinking outside the box and about being leaders in a field. What better ethos for a company, any company?

Formula One for us now is, yes, fundamentally a passion but it also needs to be a viable business. It has to be. It’s too expensive just to write off as a marketing expense. So it’s up to us to leverage its potential. We need to learn what we can, using some of the best people in the world in terms of engineering and innovation. If we transfer that to other aspects of the business we can only do well and the F1 team will earn its keep.

Likewise, the F1 team must improve and be a true showcase for our group of businesses. Yes, being in Formula One implies that you are already ahead of the pack, however, ultimately, we want to be leading that pack. It’s not going to happen overnight, but if we set realistic targets, then it’s something we will achieve.

What about the road cars? Caterham is a brand best known for the Seven, which, while a fun car, has a slightly old-fashioned image. How do you change that?

I feel the Seven is fundamental to the core values we have but the future is looking very positive and very different. The first time I was taken out in a Seven I had the broadest smile on my face for the whole journey. And I remember the announcement at Duxford earlier this year when Heikki put the green and yellow Seven through its paces. I saw his face after he stepped out and it was completely lit up. You can’t force that feeling – it’s something that radiates and I feel that the Caterham Seven is the benchmark for everything moving forward.

It’s the feeling and the experience that is important – I want everyone to step out of a Caterham road car for the first time with a smile on their face. That pure, undiluted driving pleasure should, be the basis of all our cars looking ahead. Perhaps they can be a little more comfortable and practical, but the experience needs to carry through.

I’ve met so many current Caterham Seven owners and I love the fact their car is almost a part of their family – they are so passionate about the cars and each has its own story! It’s now our job to make sure they have something to be equally passionate about in the future.

The Seven is a pretty remarkable design but it does have a slightly ‘pipe and slippers’ image. How do you attract a younger customer base?

There are aspects of the new car designs that we’re looking at that will be attractive to a younger market, but we’re also very conscious of not alienating any of our core customers by being too radical or too aggressive in our new model strategy. I think one of the main selling points will be the fact we are looking to expand the technology we use in Formula One and utilise that in our road cars – that will provide the direct link between F1 and the road, and that will appeal to drivers of all ages, regardless of their current perceptions of Caterham.

How important is Asia, and China in particular, to the project?

It’s very important, as currently there is no real competition in the niche we’re looking to develop. However I expect us to go global. Why not? Contrary to what is being reported in some places, the 2014 model is not going to be the ‘new Elise’ – it is an affordable sports car in its own right and something I’m very excited about and believe there is a market for. Obviously, Asia is a market I’m experienced with, so I feel we can fulfill a need there and explore what else we can achieve and what the masses want.

For example Japan is a country that used to love the Caterham Seven – there was even a dedicated racing series there – but that love has dwindled. I want to reignite the passion and love for Caterham and inspire people who love to drive. That’s something global, and something akin to human nature, not necessarily country orientated.

Looking back at Team Lotus, what do you think you achieved with it?

Team Lotus to me has been an incredible rollercoaster. We brought Team Lotus back into Formula One, and no one can deny us that. Yes, the name now belongs to Group Lotus, but I’ve come to realise that whatever we are called we are still the same team and will always have the same spirit our team has had since day one.

It comes back to my earlier point about people – the people in the team are what shaped this team, and I want to thank each and every one of them for their hard work over the past three years.

I think my underlying feeling now is one of excitement, mixed with a small amount of relief. You know, I love the Lotus name, there’s no denying that, but it was a great weight to carry and I feel that now it’s time to create our own legend. The Chapman days are inspirational for anyone trying to achieve greatness, absolutely, and the philosophy can carry through to what we do next.

I think back to when I decided to start a Formula One team and I chose to start a team from scratch so that we could control our own destiny. It’s definitely not been the easiest path, but now it is our time – time to take control and make our own history.

Do I regret starting with Team Lotus? No, not at all. I’m damn proud that we brought the name back and ultimately have reunited it with Group Lotus. This was always my plan but the only difference was we would own it – ha, ha!

It’s been a fantastic two years and I wouldn’t have traded it for anything. I’ve been able to work with and get to know great people like Heikki, Jarno, Anna, Mike, Silvi and Tom to name a few, and I’m looking forward to our growth and welcoming new people like John Iley, for example.

Green and yellow will always belong to the people that brought back Team Lotus and so that is the history and memory of what we take forward, now, as Caterham F1 Team. See you in Australia!