DeLorean car company goes bust after founder's arrest

In 1982, the sports car company's founder is arrested for cocaine trafficking and British taxpayers are on the hook.

Auto factory in Belfast had to close in 1982, throwing thousands out of work

The sports car looked cool, but it was too good to last. 2:12

The new movie Driven tells the story of the downfall of American automaker John DeLorean, whose eponymous silver sports car is instantly recognizable for its gull-wing door mechanism.

DeLorean's futuristic luxury ride — the model that figures prominently in the Back to the Future movies — inspired the British government to invest in a factory in Northern Ireland that employed 2,600 people.  

But it all came crashing down in October 1982, when DeLorean was arrested by the FBI for conspiring to traffic cocaine and the factory was closed the same day. (He was later acquitted on all charges.)

Each party blamed the other

A worker examines a car at the DeLorean Motor Co. factory in Belfast, which shut for good in October 1982. (CBC Archives/The National)

In the British Parliament, MPs from both the Labour and Conservative parties asked hard questions about the government's investment in the company over the years.

According to the CBC's Brian Stewart, the government was negotiating with DeLorean just hours before his arrest to inject more money into the plant.

Investments in the company were considerable — $120 million in government loans and loan guarantees, and $80 million from private investors. 

The blow was also harsh for Northern Ireland's economy, wiping out valuable jobs in an economically depressed region and leaving 10 smaller companies that supplied DeLorean's company unable to pay their bills.

It wasn't the first time, either

No one could say they were surprised by the factory's failure: in February 1982, the CBC's Mark Phillips reported on trouble at the DeLorean plant in Belfast, as seen in the clip below.

Sales of the sports car were dismal — not enough people were willing to shell out $40,000 ($97,000 in 2018) for the car, which made its North American debut at the Toronto Auto Show earlier that month. 

Built in Northern Ireland, the luxury sportscar company has crashed. 1:38

Driven is currently screening at the Toronto International Film Festival.