Delorean, John Zachary
Delorean, John Zachary
(b. 6 January 1925 in Detroit, Michigan; d. 19 March 2005 in Summit, New Jersey), innovative automobile executive whose attempts to found his own automobile company ended in notoriety.
DeLorean was the eldest of four sons of Zachary and Kathyrn Pribak DeLorean, both factory workers. He attended public schools in Detroit. After graduating from Cass Technical High School in 1941, he entered the Lawrence Institute of Technology. His college education was interrupted when he was drafted into the U.S. Army in 1943, but he was not sent overseas. After World War II, he worked as a draftsman for the Public Lighting Commission in Detroit before returning to Lawrence, from which he graduated in 1948 with a BS in mechanical engineering.
After working as a salesman for two years, DeLorean entered the Chrysler Institute, a postgraduate program for automotive engineers. He graduated with an MS in automotive engineering in 1952 and worked briefly for the Chrysler Corporation before shifting to the Packard Motor Car Company. In 1954 he married Elizabeth Higgins; they had no children. In 1956 DeLorean accepted a position at General Motors’ Pontiac division, then the stodgiest of GM’s divisions. He earned an MBA from the University of Michigan in 1957. In the late 1950s and early 1960s Pontiac became the most exciting place to work in the American automobile industry, and DeLorean played a key role in most of its advances. Among the innovations for which DeLorean was primarily responsible were concealed windshield wipers and the overhead cam engine. It was DeLorean who figured out a way to meld various elements GM had already produced into a unique small car, the Tempest, which was introduced in 1959 to great success.
In 1961 DeLorean became Pontiac’s chief engineer. In 1963 he and Pete Estes, then Pontiac’s general manager, produced the Pontiac GTO, a small car with a huge engine. It was the first and most prominent muscle car of the 1960s. In 1965 DeLorean became the general manager of Pontiac; at age forty he was the youngest man to head a GM division. As general manager, he demonstrated an unusual talent for marketing, and Pontiac sales rose 25 percent during his tenure. He had an even greater talent for marketing himself, angering the company’s top managers by using his own photo in insets of Pontiac print ads. He also ignored GM’s dress code and became increasingly concerned with his appearance, dieting down from 200 to 160 pounds. That gave him, at six feet, four inches tall, an extremely thin but more youthful appearance. His marriage ended in divorce in late 1968. In May of 1969 he married Kelly Harmon, a model. They adopted a son not long before the marriage ended in divorce in 1972.
In 1969 DeLorean was made the general manager of Chevrolet, GM’s largest division. He took over the division at a difficult time, and Chevrolet seemed to be in improved shape in 1972, when DeLorean was appointed to the position of vice president of car and truck production for the entire General Motors line and moved to the fourteenth floor, where GM’s top executives were located. It was widely assumed that DeLorean would one day become president of GM. Seven months later, on 2 April 1973, DeLorean resigned. His abrupt resignation increased the aura that was developing around him, and he was called “the man who fired General Motors.” In retrospect, it appears that GM, uneasy about DeLorean’s outside business interests and his penchant for ignoring company procedures, moved him to keep a closer eye on him and then forced his resignation.
A few weeks after leaving GM, on 8 May 1973, DeLorean married Cristina Ferrare, a model and actress; they had a daughter. After he left GM, he became involved in several business ventures, including miniature racing tracks, car dealerships, and patent enforcement. None of them was successful. DeLorean was preparing for something much bigger, though: launching his own automaking company. DeLorean knew that the best way to launch the new company would be with a limited-run sports car that could be sold at a premium. He told reporters it would be an “ethical car,” one that was safe and economical, delivered good gas mileage, and would last twenty years or longer. Its outer shell would be a thin metal coat of stainless steel, and it would have gull-wing doors that opened upward.
DeLorean estimated that he would need $90 million to get his car on the market. He negotiated an agreement in which he agreed to manufacture the car in Puerto Rico, which would provide $60 million through a mix of guaranteed loans, while DeLorean raised an additional $30 million. Shortly before he was ready to close with Puerto Rico, though, he received a better offer from the British government, which was willing to put up $106 million in grants, investment capital, and loans if he would manufacture the car in Northern Ireland. An agreement was signed on 21 June 1978. With realization of his dream in his grasp, DeLorean became curiously detached. Instead of having his own staff of engineers design the components of the car, DeLorean farmed the job out to Lotus, a noted British maker of hand-tooled cars. But Lotus had never produced a car for an assembly line. To keep from falling too far behind DeLorean’s demanding schedule, Lotus began making changes, and with each change the car became less like DeLorean’s original prototype and more like a Lotus Esprit. DeLorean’s own head engineer complained that the parts were not being designed for a fast-moving assembly line and that there would be problems with the suspension system. DeLorean never did force Lotus to deal with the concerns of his head engineer.
DeLorean worked long hours in his company’s New York headquarters, but he spent the bulk of his time on matters unrelated to his car company. (Other projects included efforts to launch a bus-manufacturing company and the purchase of a company that built off-road vehicles.) When the DMC-12 rolled off the assembly line in early 1981, it weighed 900 pounds more than DeLorean had intended, had trouble meeting minimum Environmental Protection Agency mileage requirements, and cost $26,000, $7,000 more than a Corvette. Initially, the car looked like a hit, and dealers were able to sell it at a premium. But word of problems soon began to spread: windows frequently fell out of their tracks, an under-strength alternator caused problems in the electrical system, and doors jammed. Many of the early problems were resolved on the assembly line in Dunmurry, Northern Ireland, but as the assembly line sped up, supply began to catch up with demand. Meanwhile, DeLorean had been spending money at a rate that far exceeded his projections.
In mid-1981 DeLorean prepared to take his company public. The offering provided for DeLorean to be able to convert his own shares. There was no such provision, though, for the dealers, who had invested early; for DeLorean’s executives, who had been promised stock options; or for the British government, which had put up the money that had made the company possible. In order to make the stock offer look more attractive, DeLorean added 900 more workers to the assembly line, pushing his total workforce in Northern Ireland up to 2,400. Producing extra cars at a time when supply had caught up with demand, however, was a foolish waste of money.
In October 1981 DeLorean’s former secretary, Marian Gibson, handed over damaging documents to a member of Parliament. They suggested that DeLorean might be milking the company and made it clear that DeLorean had squeezed the British government for far more money than the initial agreement stipulated. When the government showed no inclination to investigate, she went to the press. An explosion of negative coverage delayed the stock offering. There was more negative publicity in November, when DeLorean was forced to issue a public recall because nuts holding together parts of the front suspension were coming unscrewed. The stock offer had to be withdrawn. DeLorean had produced far more cars than could be sold—a total of 9,000—and the company faced a crippling cash shortfall. In February 1982 the British government forced the De Lorean Motor Company into receivership and began searching for an investor who could save the company. There was some interest, since the factory was perhaps the best facility in the world for manufacturing cars, but the potential investors were reluctant to commit. Then, on 19 October 1982, as time ran out, DeLorean was arrested in Los Angeles, California. He was charged with conspiring to smuggle fifty-five pounds of cocaine, worth about $24 million, into the United States. That same day, the British government announced that the factory would be closed.
DeLorean’s ensuing trial in Los Angeles turned into a media circus. The evidence against him appeared to be strong. A surveillance tape from the Federal Bureau of Investigation showed him accepting the cocaine, saying that it came “in the nick of time,” and passing around wine glasses to toast the deal. Still, DeLorean clearly had had no prior involvement with drugs, which made it possible for his lawyers to argue that he never would have done anything illegal had the government not entrapped him in a sting operation. In August 1984 he was acquitted. During the trial, Ferrare played the role of supportive spouse to the hilt. Shortly after the verdict, though, she filed for divorce. The divorce became final on 13 December 1985.
After DeLorean’s acquittal on the drug charges, he was tried in Detroit for siphoning off about $9 million of his investors’ money. In December 1986 he was acquitted in that trial as well, but several civil lawsuits followed. A $53-million legal judgment was imposed against him in Britain, and he was eventually ordered to pay U.S. investors and creditors approximately $9 million. He married a fourth time; he and his wife, Sally Baldwin, had a daughter. Late in his life he spent an increasing amount of time dealing with litigation over unpaid fees, many of them owed to lawyers. In 1999 he declared personal bankruptcy. He died from complications of a stroke and is buried in White Chapel Memorial Cemetery in Troy, Michigan.
As impressive as many of DeLorean’s automotive accomplishments were, his image surpassed reality. The irony was that he almost managed to harness that image to do the impossible: establish a new, independent automaker. To the surprise of car experts, who felt that the De Lorean DMC-12 had too many flaws to become a classic, a strong collectors’ market did develop for it. In true DeLorean fashion, its success came with a strong assist from the media: interest developed after a De Lorean DMC-12 was used as a time machine in the hit 1985 movie Back to the Future.
For critical biographies, see Hillel Levin, Grand Delusions: The Cosmic Career of John DeLorean (1983); Ivan Fallon and James Srodes, Dream Maker: The Rise and Fall of John Z. DeLorean (1983); and William Haddad, Hard Driving: My Years with John DeLorean (1985). For DeLorean’s side of the story, see J. Patrick Wright, On a Clear Day You Can See General Motors (1979), which Wright self-published after DeLorean, nervous over GM’s reaction, tried to suppress it; and John Z. DeLorean with Ted Schwarz, DeLorean (1985). See also Charles McGrath, “He Pimped His Ride,” New York Times (18 Sept. 2005). Obituaries are in the New York Times and Washington Post (both 21 Mar. 2005).