John DeLorean: Maverick exec was talented, devious -- and never dull

By the time John DeLorean left General Motors in 1973, the company's hierarchy had had quite enough of the bright engineer who helped lead Pontiac back to greatness. And vice versa.

It was a bumpy journey. But it certainly wasn't dull.

When Packard Motor Car Co. was imploding in 1956, 31-year-old engineer John DeLorean was among the Packard employees looking for new jobs.

He was a bright young engineer with a good reputation, and three companies offered him a job: Thompson Products Co. in Cleveland, which became part of TRW Automotive; American Metal Products Co., which became part of Lear Corp.; and Pontiac.

DeLorean took the Pontiac job because it paid $5,000 more than American Metal offered.

He started at Pontiac in September 1956, and he found a home. He became part of the team that revitalized Pontiac and then followed each other up through GM's ranks.

He also became part of the power structure. By the time he was shown the door in May 1973, DeLorean, then 48, had climbed to within a few rungs of the top of the world's largest automaker.

Through the years, he changed. After successfully running Pontiac and Chevrolet, DeLorean discovered that he liked the limelight more than any GM exec should. Along the path, he stripped off GM's traditional gray flannel uniform and donned trendier duds as part of his image makeover.

Some of the greatest GM leaders of the era worked alongside DeLorean at Pontiac and Chevrolet while he was making a name for himself as a talented, hip, socially conscious and self-serving executive.

In the beginning, Bunkie Knudsen was Pontiac general manager, Pete Estes was the chief engineer, and DeLorean became the assistant chief engineer. Like those who went before him, DeLorean continued to bring along talented people when he became Pontiac general manager in 1965.

One of the people who worked for him at Pontiac was Bill Hoglund, who later ran Pontiac, Saturn, the Buick-Oldsmobile-Cadillac group and the components group before becoming GM's CFO. Hoglund worked for DeLorean as a financial staffer at Pontiac, during the period when DeLorean had a girlfriend on the West Coast and demonstrated a very un-GM-like lack of devotion to duty at a time GM execs were expected to work at least six days a week.

"He would leave the office on Thursday morning, and you wouldn't see him again until Tuesday morning," says Hoglund. Hoglund says he learned later that DeLorean was taking the company plane for long weekends with his girlfriend in a hotel room that had been stocked with goodies, at company expense, by a district official.

Hoglund's assessment of DeLorean: He was a terrific car guy and marketing executive who had everything but integrity.

He says that if you could combine DeLorean's product savvy with the integrity of Jim McDonald, you'd have the perfect auto executive.

McDonald succeeded DeLorean as Pontiac's general manager in 1969, when DeLorean moved to Chevrolet, and again at Chevrolet in 1972, when DeLorean was moved upstairs and became the group executive in charge of GM's Car and Truck Group. McDonald later became president and COO of GM.

McDonald says that when he was transferred to Pontiac from Oldsmobile, DeLorean was a great guy who helped him develop and grow. "He was very fair with me,'' McDonald says.

But McDonald also began to notice behavior by DeLorean that he considered "squirrelly." For example, DeLorean gave his hairstylist a GM company car, which the company had a hard time retrieving after DeLorean left.

"Those kinds of things just don't make sense,'' McDonald says.

Growing more emboldened, at Chevrolet DeLorean disregarded company policy. He squandered money on a prototype of a Chevrolet limousine because he wanted to ride around in one. He also spent twice the allowable budget to decorate his office and had his finance man try, without success, to hide it from GM's auditors.

One staffer who reported to DeLorean at Chevrolet, and who spoke on condition of anonymity, said that along the way DeLorean developed a fondness for expensive Swiss watches. On trips to New York, DeLorean would have the staffer buy these watches for DeLorean and put them on his own expense account — which DeLorean then approved.

But bigger shadows were to come.

An investment newsletter, the Gallagher Report, reported in 1972 that GM CEO Richard Gerstenberg had appointed a committee to investigate widespread reports of supplier kickbacks at Chevrolet. No public word on the matter ever came from GM.

Worse yet, DeLorean used insider information and used devious measures in an effort to make a killing in the stock market, according to a Detroit-area stockbroker.

As the head of Chevrolet, DeLorean was involved in the division's plans to develop the Wankel rotary engine. GM was negotiating quietly with the aircraft engine manufacturer Curtiss-Wright Corp. to use some of its technology. DeLorean knew that when the contract was signed, the deal could boost the price of Curtiss-Wright stock.

The stockbroker, who spoke on condition of anonymity, said that early in 1972 he made large purchases of Curtiss-Wright stock for DeLorean, totaling about $600,000 — the equivalent of $3 million today. According to the stockbroker, DeLorean made the purchases through his lawyer, kept his name off the paperwork and never reported the purchase to GM with his other stock holdings.

GM had strict stock-purchase reporting procedures to prevent officers and directors from doing anything unethical or illegal, but DeLorean had devised a way around them.

As it turned out, GM killed its Wankel program, and the price of Curtiss-Wright stock declined.

About that time, DeLorean also became more critical of GM and its procedures in the company's inner circles.

Some of it seeped out when The Detroit News published parts of a blistering critique of the company that DeLorean, as the newly minted group executive in charge of the Car and Truck Group, had prepared for a November 1972 GM management meeting.

It was the final straw.

Predictably, there was a flap with finger pointing and a flurry of memos and meetings.

Ultimately, GM's hierarchy ran out of patience. Vice Chairman Thomas Murphy, who later succeeded Gerstenberg as CEO, summoned DeLorean to a meeting in his office. With a public relations representative present, he told DeLorean that his GM career was over.

DeLorean left GM in May 1973. But he did not disappear from the auto scene — or the headlines.

As one of his post-GM projects, DeLorean collaborated on a tell-all book about GM with J. Patrick Wright, former Detroit bureau chief of BusinessWeek. Just before the manuscript was ready to be published, DeLorean got cold feet. He was trying to build his own car company and didn't want a war with his former employer.

So in 1979 Wright published their collaborative work, On a Clear Day You Can See General Motors, without DeLorean's name on it. Some GM critics, including Ralph Nader, praised DeLorean's candor and valor for raising tough issues.

The one-time wunderkind was especially critical of GM for things such as the office dress code; mandatory fealty to the boss, not the company; rigid dictation of policy from on high; expediency over ethics; cronyism; and self-aggrandizement.

But some of his old colleagues scratched their heads. In their memories, DeLorean had engaged in many of the ideas and practices he had criticized.

Robert Dewey, a Chevrolet financial executive when DeLorean was Chevy's general manager, later worked for DeLorean's sports car venture and knew him as well as anyone. He said DeLorean was much like the GM executives that he claimed to disdain.

Dewey, who died in 2003, said when the book was published, it baffled him. Said Dewey: "It seems like every other page I would pick something out and think 'How can this bother you, John? This is you.' "

In 1975, DeLorean started DeLorean Motor Co. A factory in Belfast, Northern Ireland, eventually turned out fewer than 10,000 sports cars with stainless steel bodies and gull-wing doors.

The company collapsed into bankruptcy in October 1982, one week after DeLorean was arrested on drug trafficking charges in Los Angeles. According to prosecutors, the alleged drug running was part of a plan to raise capital for the ailing car company.

DeLorean was acquitted of those charges in August 1984.

But his legal troubles weren't over. Thirteen months later he was indicted in federal court in Detroit on fraud charges relating to the financing of his failed car company. He was acquitted of those charges in December 1986.

Despite the acquittals, his career was over.

Though he tried, DeLorean was unable to get another carmaking venture started. He died in 2005, never having recaptured the magic from the Pontiac days half a century earlier.