Published on August 21st, 2013 | by Jo Borrás131
The Elio Motors Saga: If it Looks Like a Dale and Quacks Like a Dale …
First came the gas crisis. The price of oil and gas skyrocketed across America and people started looking everywhere for a way to ease the pain on their pocketbooks. Many Americans traded their big-engined pickups and sportscars for smaller, more fuel-efficient compacts from Toyota and Volkswagen that promised better MPG and lower operating costs.
At the same time, the economy nose-dived, and thousands of Americans lost good-paying factory jobs at Ford and GM plants. Out of that chaos came a visionary with plans for an innovative 3-wheeled car that promised nearly 70 mpg, made incredible safety claims, and all for a pricetag about half that of the cheapest cars of the day. The biggest promise, though, was the promise of jobs – jobs that would reinvigorate economically depressed areas and give hope to those who’d been hurting the most after the factory closings.
People rallied around the company’s charismatic CEO, and invested millions of dollars to get the car certified and crash-tested. Big name CEOs were brought in, and Ayn Rand was heavily quoted by supporters of the company who insisted that there was a huge demand for exactly this kind of vehicle.
I’m talking, of course, about the 1975 Dale three-wheeler.
Back in 1975, 37-year-old Geraldine Elizabeth “Liz” Carmichael launched the Dale on a hopeful public at the LA Auto Show. Claiming to be a mother of five and a widow of a former NASA structural engineer, Carmichael was a fraud. The Dale, itself, was a fraud, and there was no way a knowledgeable look at the company – or the man! – could reveal otherwise.
That’s right, Liz Carmichael was a man. A man named Jerry Dean Michael who used a “Made in the USA” message coupled with extreme promises and an unconventional vehicle that was just different enough from a normal car to convince people who knew a lot less than they thought they did that the people who knew the car business didn’t “get it”. In the end, Jerry Dean Michael fleeced big-time CEOs, investors, and hopeful would-be employees who plunked down significant deposits on a Dale out of some $30 million dollars.
After being arrested and charged with grand theft, fraud, and securities violations, Jerry/Liz jumped bail and went into hiding with thousands of dollars. Jerry, abandoning the Liz persona, was eventually caught after the airing of this episode of 80s era cult-classic, Unsolved Mysteries. You can watch the segment, below.
Dale Car via Unsolved Mysteries
Fun stuff, no? Unfortunately, the story of the Dale seems all too familiar to anyone who’s been following the saga of Elio Motors since the company first showed off its 3-wheeled Elio in 2010 with the hopes of building the vehicle in Pontiac, Michigan. Like Shreveport – where Elio is currently petitioning the taxpayers to front him the $3 million he needs to occupy the abandoned GM plant in Caddo Parish – the city of Pontiac, Michigan also suffered from a shutdown of General Motors plant that cost the local economy hundreds of good-paying jobs.
Also like Shreveport, Elio Motors eyed Pontiac, Michigan as a place to set up shop, promising the local community good-paying jobs that fed all the “Made in the USA” fires. Back then, Elio Motors promised they’d be ready to roll in just 18 months … which (you might notice) would have put production Elios on the road by mid-late 2012.
It’s 2013, and we’re still about 18 months out for the first Elio Motors trikes … and those may or may not be crash-tested, depending on whether or not the Elio trike is designated a car or a motorcycle if/when it ever reaches production. Elio’s promise of achieving a 5-star rating (something only 1% of cars achieve under the new testing structure) hinges on whether it ends up classified as a car, bike, or something in-between.
The commissioners running the Caddo parish have, by now, had a good long look at Elio’s financials (which were reproduced on Gas2 last week), and they don’t seem too convinced, despite the nationalistic/rabid fervor of Elio supporters. As a case-in-point, Caddo commissioner Stephanie Lynch may have said it best when she said that Elio Motors’ inability to raise capital up to this point may make the deal too risky and speculative. “If Elio is having trouble raising $7.5 million to purchase the plant,” she says, “where is the $200 million going to come from that is actually needed to bring those jobs to Caddo Parish?”
It’s interesting to note that Lynch is not opposed to the parish purchasing the plant, but is specifically concerned about Elio’s plan. She says she’s “concerned about the lack of private investment needed to actually bring those jobs to fruition.”
Elio Motors will certainly need more investment if they hope to raise that $200 million … especially considering their own costing has them making just $1000 per trike sold. The company would, according to their numbers, have to sell 200,000 trikes just to start building them, at that rate.
Maybe they will. Who knows? Certainly not me. I have no idea what’s going to happen to Elio Motors and the thousands of people who’ve put down deposits without reading/understanding the company’s financials and projections. I am, however, a student of history who hopes that the Dale’s history isn’t about to be repeated.
What do you guys think? Is the Elio Motors trike the new Dale? Take a look at the pictures, below, and let us know what you think in the comments, below.