John DeLorean

Sharp but flawed car industry tycoon

John DeLorean set out to create, in 1974, what he ambiguously referred to as an "ethical" sports car. This was to be a project that would set right all the ills he perceived to be inherent with General Motors - his Alma Mater turned nemesis - and its methods. And so it was a fabulous irony that this lantern-jawed, eel-slippery American businessman became, in October 1982, the only car industry tycoon ever to have been busted for conspiring to distribute cocaine.

John Zachary DeLorean, engineer and car-maker: born Detroit, Michigan 6 January 1925; staff, General Motors 1956-73; founder, DeLorean Motor Company 1974; married 1957 Elizabeth Higgins (one son, two daughters; marriage dissolved 1969), 1969 Kelly Harmon (marriage dissolved 1972), 1973 Cristina Ferrare (marriage dissolved 1985), fourthly Sally Baldwin; died Summit, New Jersey 19 March 2005.

John DeLorean set out to create, in 1974, what he ambiguously referred to as an "ethical" sports car. This was to be a project that would set right all the ills he perceived to be inherent with General Motors - his Alma Mater turned nemesis - and its methods. And so it was a fabulous irony that this lantern-jawed, eel-slippery American businessman became, in October 1982, the only car industry tycoon ever to have been busted for conspiring to distribute cocaine.

Although, two years later, he was acquitted on the grounds of "entrapment", it turned him into one of the most ethically suspect entrepreneurs of the late 20th century. This image was reinforced by an FBI videotape on which DeLorean, at the sight of 55lb of cocaine, declared the drug "better than gold". How Britain's Labour and Conservative parties must have wished they had never encountered the smooth-talking conman.

The car industry and politics are always tricky bedfellows, but DeLorean's involvement in British public life had a highly volatile third dimension - Northern Ireland. Despite being courted by various US states as well as Puerto Rico, in the 1970s DeLorean investigated the idea of basing a new sports car factory in Belfast. James Callaghan's Labour administration of the day seized on the chance to bring such a new high-tech business to the province, and the initial funding it offered to build the car plant - a shade under £40m - proved irresistible to DeLorean, despite the issue of a workforce completely unschooled in the automotive industry. Construction of the factory began in 1979 at Dunmurry, south-west of Belfast. It was a "greenfield" site, in fact former bog land, but it was also an area of high unemployment at an axis between Catholic and Protestant communities. A "great psychological boost for Ulster", the then Northern Ireland Secretary Roy Mason declared it.

DeLorean's credentials were superb: he had headed two of the biggest divisions of General Motors and also been a standard bearer for America's National Association of Businessmen. Moreover, even his detractors admitted he was a brilliant engineer skilled at identifying successful new markets.

When he was a child, DeLorean's family (his immigrant father was a Ford foundry worker) had split their year between Detroit and Southern California, and John graduated from the Lawrence Institute of Technology in 1948 with a degree in industrial engineering. Chrysler snapped up the promising young engineer, and he won a master's degree in automotive engineering in 1952 from the Chrysler Institute based in Highland Park, Michigan.

Just one year later he was in charge of research at the venerable US car company Packard, while in his spare time, he studied law and business administration. John DeLorean's energy in the sedate world of Detroit car- making left his peers and superiors open-mouthed with admiration and envy. And he was a mean saxophone player too.

In 1956, he joined General Motors' Pontiac division as director of advanced engineering, rising to general manager by 1965 while also occupying, aged 39, the exalted position of GM vice-president. Along the way, as Pontiac chief engineer, his brilliance at "product planning" was revealed in the 1964 Pontiac GTO.

Pontiac prospered and DeLorean was propelled to the top job at Chevrolet in 1969. It was General Motors's biggest car-making unit and by 1971 DeLorean could take the credit for selling three million Chevrolet vehicles in a year for the first time. A year later he was a member of five GM committees, as well as steering the destiny of all GM car and truck programmes. The company's presidency seemed a foregone conclusion.

In 1973, however, it seems John DeLorean hit his mid-life crisis with a screech of rubber. Why he walked out of the corporation was never entirely clear, but he decided he was not going to conform to its conservative ways. His long hair, beads and oversized belt buckles were at odds with GM's sober expectations. He reprofiled his jawline in one of several facelifts. He divorced his first wife and moved to California, where he dated Tina Sinatra (daughter of Frank) and the Bond actress Ursula Andress. But most of all he set out to establish a conglomerate to take GM on and beat it. As his first ventures included an avocado farm and a ski school, this was some ambition.

But the flashy image DeLorean had cultivated across the United States made it easy for him to raise finance. Some 345 car dealers put up $8.6m towards his ethical sports car (even though his own prospectus acknowledged the venture as risky), the Bank of America gave him $25m and private investors were lured in, including the television chat-show king Johnny Carson with $1.5m. Suddenly it is easy to see how Downing Street was mesmerised.

The DeLorean car itself usually gets overlooked in any discussion of its "father". It was, and is, one very weird vehicle. Part of DeLorean's "ethic" was that it would be led by pure engineering principles like a Porsche 911, a rear-engined two-seater, with a novel all-plastic chassis. But the showman in him hampered these principles from the very outset. "I want people's eyes to light up when they walk through the showroom", he said, and to do this he gave the car "gull-wing" doors that, if both were open, gave the impression of a bird in flight, and also body panels in unpainted stainless steel.

In 1979, the engineering development of the DeLorean was assigned to Lotus in Norfolk in a £9.4m deal that can only have boosted the patriotic delight of the incoming Tory government. Yet Lotus watered down DeLorean's concept. Under its shiny steel panels, the car became little more than a Lotus Esprit with a V6 Renault engine.

Production of the car, dubbed the DeLorean DMC12 (standing for DeLorean Motor Company) got underway in December 1980. In the United States, its sole market, the euphoria was immense but the reality was appalling. The car was underpowered, unexciting to drive and very expensive at $25,000. Even worse, the 2,500-strong Belfast workforce was turning out cars of such poor quality that rectification plants had to be built across the United States to fix them before they were delivered to customers. Not only that, but the stainless steel panels showed every speck of dust and even fingerprints. Despite its arresting styling, the DMC12 was simply a bad car.

Yet, no-one was prepared for DeLorean's declaration of insolvency in January 1982. In February, the British government appointed receivers and by October, production had ceased, after only 8,550 had been built. DeLorean's arrest on coke-dealing charges simply added to the chaos.

Where had all the cash gone? Allegations flew from former executives that DeLorean had been using the money to finance other ventures. He hotly denied this but evidence is provided by Sir Michael Edwardes in his book Back from the Brink (1983). While DeLorean should have been in Belfast attending to quality problems with his new car, he was lunching with the British Leyland chief in New York and trying to interest him in a deal whereby DeLorean would distribute the Range Rover in the US market.

DeLorean also claimed, in Automobile Quarterly, that he could not spend much time in Northern Ireland because the IRA had made him a marked man. "I was instructed by the British government to keep away because I was a security risk", he claimed.

Faced with pouring more funds into the DeLorean plant after a total of £77m of taxpayers' money had by then been swallowed, the Conservatives elected to let the receiver Kenneth Cork close the business down. The workforce was made redundant and the factory sold.

DeLorean never set foot in Britain again for fear of arrest. This was after a Michigan grand jury investigated the disappearance of $17.5m from the sports car project. It emerged that the sum had been funnelled out of the company to a Panama-based firm called General Product Development Services, apparently to pay for the car's development at Lotus. What had actually happened was that the cash had found its way back to the hands of DeLorean himself, the Lotus chief Colin Chapman and a Lotus executive, Fred Bushell.

Bushell was jailed for three years in 1992 for his part in what Lord Justice Murray at the Belfast High Court called a "barefaced, outrageous and massive fraud". Chapman died in 1982 and so was never tried; DeLorean, meanwhile, successfully fought extradition to both the UK and Switzerland. The accountancy firm Arthur Andersen, held liable for missing the financial skulduggery, was eventually forced to pay out tens of millions of pounds to settle lawsuits from creditors. In 1999 DeLorean was declared bankrupt and creditors evicted him from his palatial ranch in New Jersey a year later.

DeLorean cars survive today as collectors' items. They also exist in the imagination of a younger generation as the stars, along with Michael J. Fox, of the Back to The Future movies. Their sharp but flawed creator, however, lived out his final years as a pariah of the political and business worlds, with none of his pronouncements or plans ever taken seriously again except by, perhaps, the God he claimed latterly to have rediscovered.

Giles Chapman