Great Financial Disasters of Our Time: The DeLorean Fiasco - Back to the future
Saturday 22 August 1998
The DeLorean gull-wing car, a revolutionary example of motor engineering, attracts upwards of 2,000 fans at its annual conventions, most of them from the US.
DeLorean's downfall, in 1982, came after barely 8,500 models had been manufactured. The firm collapsed in a welter of recriminations, lawsuits and the trial of its founder on drug charges.
That such an experiment should have happened at all was a miracle, born out of the unshakeable conviction of one man, John DeLorean. His dream coincided with the near-desperate need for Labour, in government during the late Seventies, to prove that it could regenerate the Northern Irish economy - helping to solve the Six Counties' sectarian stalemate at the same time.
Back then, John DeLorean had a major advantage: credibility - despite sniggers after revelations that he had plastic surgery to extend his chin and appear more lantern-jawed. DeLorean's reputation was built as general manager of Pontiac, part of the General Motors empire, where he set production records still to be surpassed.
He sensationally resigned in the mid-Seventies and almost immediately announced plans for a new Dream Car, using unleaded fuel and a catalytic converter. No need for welding or resprays - just clip on a new panel; the underbody would be non-rusting lightweight fibreglass; and, with gull- wing doors and a stainless steel body it would look like nothing else on the road.
Governments around the world fought bitterly with each other to offer DeLorean grants to build on their patch. Finally, the search for a virgin site led to Northern Ireland, with Puerto Rico narrowly pipped at the post.
Within four years, first Labour, then Mrs Thatcher's Government - poured pounds 85m into a factory, supposed to employ more than 2,500 people in impoverished West Belfast.
The DMC 12 seemed to justify the extravagant hopes placed in it. Then the carping started: it was not powerful enough, every time one touched the body work, it reflected their handprints.
More importantly, the company lurched from one cash crisis to another, dependent on handouts doled out with increasing reluctance by Tory ministers. Endless demands for cash were accompanied by evasion as to how the previous tranche had been spent.
The end came in 1981, when DeLorean was arrested in California for cocaine trafficking (he was subsequently acquitted on grounds of entrapment).
Meanwhile, millions of pounds meant to pay Lotus, the car's design consultants, vanished without trace into a Swiss bank account. A later investigation suggested DeLorean, who had promised to pour his personal fortune into the venture, had just half a million dollars invested in it.
Since his drug trial, John DeLorean, now 72 years old, has faced one financial crisis after another. He still has his dreams. Only 12 months ago, he announced plans for another car venture, this time in the US.
He needn't bother. A remarkable 8,000 Delorean cars are still about. Ironically, what was planned as a mass-production model is now a coveted limited-edition classic car, with mint DeLoreans fetching up to pounds 35,000.
Their futuristic design means they appear regularly in sci-fi films, most notably Back to the Future. Except that, as some erstwhile DeLorean workers are fond of pointing out, every time Michael J Fox gets out of the time machine, its doors sag slightly - a common production problem at the time.
A failure then, but on a heroic scale.
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