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Hooniverse Asks- What’s History’s Greatest Automotive Scandal?

Robert Emslie December 5, 2012 Hooniverse Asks 86 Comments

When I was a kid, I eagerly awaited the mailman’s arrival as I subscribed to a multitude of car magazines, and otherwise had no life. During that era Motor Trend seemed to have an inside track on the Dale – an American three-wheeler that was going to revolutionize the auto industry. I was mesmerized  by this beast. Championed by a woman during a time when the Equal Rights Amendment was denigrated as the end of America as we know it, the Dale seemed like a savior from the status quo. 

Of course, it was not meant to be. In fact, it was never meant to begin with. That woman promoting the Dale and sanguinely accepting thousands in deposits from prospective dealers – Liz Carmichael – was in fact a dude, and the Dale was, ultimately an elaborate con job.  Perhaps the adam’s apple and lack of a functioning prototype should have been a clue, but like I said, I was a starry eyed kid.

The Dale story is good enough for a Hollywood movie, and it, along with John Z Delorean’s travails, are in my book the auto industry’s biggest travails. But that’s just my opinion, and I’m sure yours might differ. What do you think, are there worse? What, in your opinion, is the the worst scandal in automotive history?

Image: [Hemmings]

  • http://www.hooniverse.com Kamil_K

    In recent time, in motorsports, crashgate was really messed up IMO.

    On a related note, Smokey Yunick's 7/8 scale Chevelle was pretty amazing.

  • http://www.automobile-catalog.com/ P161911

    -2005 US Grand Prix

    -Oldsmobile Diesel Engines

    -For an actual "scandal" the Mitsubishi defectl cover up: http://en.wikipedia.org/wiki/Mitsubishi_Motors#Ve

    • http://www.hooniverse.com Kamil_K

      Funny you should mention Oldsmobile diesels. Be here at 1200EST/900PST today.

  • $kaycog
    • pj134

      If I remember correctly, many GM full size pickups had saddle tanks that were similar in burningness.

      • http://themagicboltbox.wordpress.com/ themagicboltbox

        Actually, both defects are overblown (thanks, I'll be here all week). The Pinto's defect was real, but far less dangerous than reported. What really amped it up was the revelation that Ford execs had established a financial formula for the value of a human life.

        The GM saddle tank fiasco was created entirely by Dateline, in which they rammed a car into the side of a GM pickup and the pickup exploded. Problem was, when the tape was slowed down, you could see the small rockets that they had taped inside the truck's fender.

        • http://PFMTechnology.net IronBallsMcG

          I believe there was also an ill fitting or missing fuel cap.
          I still hold a grudge against NBC over that one.
          As far as I'm concerned the scandal is on the peacock.

        • http://hooniverse.com/ Tanshanomi

          "Ford execs had established a financial formula for the value of a human life. "

          For the umteen billionth time, NO THEY DID NOT. Federal regulators at NHTSA (the National Highway Traffic Safety Administration), established the formula. Ford execs simply discussed calculations based on that formula in a memo about the rollover risk of production cars in general. The Pinto and fuel fires were never mentioned in relation to those calculations.

          Furthermore there was never a point where a change to the Pinto was discussed and rejected. No alternate fuel tank design was ever proposed at Ford.

          The Pinto scandal is an utter myth, rooted in a complete journalistic hack job by Mother Jones. Anybody who calls himself a car guy (or herself a car gal, I suppose) ought to know that.

          • http://themagicboltbox.wordpress.com/ themagicboltbox

            I'll defer to you there, I don't know all the ins and outs of the formula calculation. However, it might be even more damning to say "there was never a point where a change to the Pinto was discussed."

            • http://hooniverse.com/ Tanshanomi

              Why is that damning? It's like saying "There was never any point where a change to the skinny roof pillars on BMW's Neue Klasse cars was discussed, to strengthen the roof."

              • http://themagicboltbox.wordpress.com/ themagicboltbox

                Well, assuming Ford was aware of the issue (or potential issue) or the public was aware of the issue, then their inaction is damning. Unless, of course, the issue didn't surface until the Pinto was out of production or something.

        • pj134

          I'm aware, which is why I went with "similar burningness" although it is a bit lacking in descriptness.

          It did happen and a few people were seriously hurt by it, but a lot of it was the media trying to drum up ratings.

          Hi Audi 5000, how are you doing today?

    • http://www.hooniverse.com LTDScott

      Ford has come under fire (tip your waitress!) for similar issues in the Crown Vic. Apparently a few cops have been burned due to it. But in the case of the Crown Vic, it's just a numbers game. There have to be more of them parked on the side of the highway where they can potentially be rear ended than any other car out there, simply due to their job role.

      • Felis_Concolor

        The irony is how desperately the police wanted to fix the problem: "We love this car – but it's killing us." I met one of the lawyers for the plaintiff's side a few years ago and he enlightened me to the flame retardant "diaper" which was subsequently wrapped around the fuel tanks of every police spec CV. I don't recall if civilians could order the same safety device during new vehicle sales, but I think it was retrofitted to hundreds of prior purchase police CVs.

        My Roadmaster wagon, one of the last of GM's B-body behemoths, features the same design "flaw/feature" – but its fuel tank is made of easily ruptured plastics, which do a good job of dumping the fuel in a catastrophic accident, as opposed to steel's tendency to buckle and produce atomizing pinholes, which is where the real danger lies.

      • http://hooniverse.com/ Tanshanomi

        The 1987-88 "scandal" about Ford F350 ambulance fires was a fairly legit problem with over-pressurizing the fuel system which led to a recall (and supposedly an all-diesel Ambulance mandate from Ford until 2010, although I have never seen that verified by a reputable source). What's ironic is that it hasn't had the traction in the public consciousness in subsequent years that these other mythical scandals had.

    • ptschett

      I need a sign like that for any time I visit Taco Bell.

      • $kaycog

        That would be perfect for Taco Bell.

  • pj134

    Just so I can say "I told you so" for the rest of my life if I'm right.

    <img src="http://static.ddmcdn.com/gif/elon-musk-1.jpg&quot; width=500>

    • Alcology

      kinda looks like he's peed his pants

      • http://hooniverse.com/ Batshitbox

        Let's hope it was him who peed them.

  • http://hooniverse.com/ HycoSpeed

    Dale is the king of the hill, er, 'queen' I guess, in terms of crazy unbelievable story scandals. I remember reading a Car and Driver article on the whole story when I was a kid and it was so ridiculous that I never forgot it. Then I found Hooniverse and people who know the story and I was happy!

    I think scandal certainly carries with it some connotation of person impropriety, like Liz Carmichael or pj's suggestion above. Some automotive related stuff has the scandal sans personality, so is crazy yet not quite as entertaining. I'll chalk my vote up in that block, the Ford Explore/Firestone Tire fiasco.

    <img src="http://www.blogcdn.com/www.autoblog.com/media/2012/01/miller-explorer-video-1327615316.jpg&quot; width=500>
    Much like un-intended acceleration, just because you freak out and can't drive, it doesn't mean someone should get sued. Car and Driver (to mention them again for some reason) even conducted blow out tests and couldn't duplicate it. I am sure if Dateline was running the test they could have gotten a more 'explosive' result.

    • http://www.hooniverse.com LTDScott

      I worked as a tech at a Ford dealer during the time of this, and yes, fiasco is an apt description of the situation.

    • http://www.hooniverse.com Mad_Science

      I was working as a tire monkey at a popular shop that was friendly with the local Ford dealer at the height of that insanity.

      We could do 5 tires (spare too) on an Explorer in record time. Then it expanded and included the Expeditions and trucks and things just got nuts.

      At one point we had 5 bays with 5 Explorers getting 5 tires each all at the same time.

      • http://www.proofnpudding.com muthalovin

        That's, like, what… a whole mess of tires!

  • jtk2

    Fisker

  • jeepjeff

    [youtube DgqSEL0N5-w http://www.youtube.com/watch?v=DgqSEL0N5-w youtube]

    • GlassOnion9

      Isn't that an Arlo Guthrie song?

      • jeepjeff

        It is, but the only youtube videos are him singing the updated "Fannie Mae" version, and I wanted to reference the late 80s debacle as well as the 2008 debacle. This was as close as I could find.

  • http://www.hooniverse.com LTDScott

    Unintended acceleration cases marred the reputation of Toyota and nearly ruined Audi in the US (Accelerates Under Demonic Influence!).

    The Toyota/Lexus one of recent years really fires me up, because the most prominent example of this was the CHP officer killing his family in a Lexus loaner car right here in San Diego. I personally think there is no excuse for this to happen to ANYONE, let alone a Highway Patrol officer who should be trained to deal with situations like this.

    • Alcology

      The results in both cases were the same. Audi found ZERO examples of this actually occurring. It was people slamming the gas when they meant to hit the break. Toyota found 1 case that couldn't be proven either way. Pretty ridiculous in the whole scheme of things.

      • OA5599

        If a car has the accelerator pedal indistinguishable from the brake pedal, how could you not consider that to be a dangerous design defect, regardless of whether the resulting collision was due to powertrain management systems or user error?

        • bhtooefr

          The thing is, UA didn't occur in any of the VAG manual transmission cars from that time period (with the same pedal spacing, and it'd actually be easier to not realize you're hitting the accelerator due to the brake being narrower), and it didn't occur in other cars with similar pedal spacing and positioning (for instance, the Civic from that time period).

    • JayP2112

      60 Minutes ran pressure to an Audi transaxle at something like 600psi- were that could never occur in actual use.

      I was able to buy my 5000 automatic cheap because resell was in the toilet. Being the kinda teen who wasn't pleased with anything the way it was, I removed a 1" spacer from the brake pedal. That was all it was… a spacer. After taking it off, the car did that UA… I thought I was pushing the brake whereas I was standing on the accelerator.

      The 1" spacer was there to train drivers to feel the different in the pedal planes.

    • racer139

      Wasnt it somthing to do with the pedal getting stuck on the floor mat.

  • http://www.flowerpowerkc.com Alff

    In order for something to be a scandal, the story must be told. One story that isn't told, but has the potential to reach scandalous proportions, involves used car financing, usurious interest rates and questionable collection practices that are widespread.

    • gearz1

      The proliferation of buy-pay here, and payday loan sharks is appalling. Gouging the people that can least afford it. I have been watching for legislation, but the way the political payday system works,doubt it will be coming anytime soon.

      • danleym

        I'm not excusing the actions of any of the people doing the taking advantage of- it's wrong, no question about that, but don't the people who are taking loans they can't afford, with full knowledge of the terms of the loan, have some responsibility? I mean, if it's a screwed up loan, don't take it. If you can't easily afford a $10,000 dollar car, then stick with one that cost you $1k or $2k until you can afford better.

        That said, I think the way that interest payments are skewed toward the front of the loan (any type of loan) in the US (maybe elsewhere, too, I just don't know) is criminal, and there are no options for anything else, all banks do that, big loan or small.

        • http://www.hooniverse.com Mad_Science

          "with full knowledge of the terms of the loan"

          Is not necessarily a valid assumption. The crowd financing a '99 Town Car at $100/mo can barely read or do basic math, let alone understand the terms they're signing up for.

          Not sure what I'd do about it, though. Safety standards for financial instruments? Labeling safe loans as safe? Labeling dangerous loans as dangerous?

          • OA5599

            I have advised people not to take bad loans, and occasionally even not to buy the things they are trying to borrow the money for. It has never ended well. They "need" those things and resent my interference.

          • danleym

            Fair enough. I don't really know what can be done besides making sure a solid education is available to everyone. But even then, you can't make people learn something if they don't care.

          • http://www.automobile-catalog.com/ P161911

            I spent a brief time working at Carmax right after college. I remember trying to sell a car to one customer, they had HORRIBLE credit, bankruptcy, repo, etc. Most places wouldn't touch them at all or if they did offered them a 28% interest rate. We got them approved for something like 18%. I tried to steer them towards a $6000 or so Taurus. No sale, they wanted a $15,000 used Lexus.

          • http://www.hooniverse.com Mad_Science

            10 years ago, I was of the mentality that people shouldn't be protected from making bad choices.

            I still am, philosophically speaking, but from a pragmatic standpoint the problems come when the consequences of those bad choices aren't limited to those making them (e.g. financial crisis).

            We already impose limits and labeling requirements on other consumer products for which most of the public can't be expected to understand the details of (e.g. drugs and medical devices), so I'm kind of of the opinion that financial products could use a bit of that. But then again, having personally dealt with the FDA in my professional life, my faith in government regulators getting things right is…not exactly rock solid.

            And with that, I conclude my serious-business commenting activity for the day year.

            In other news, I got the Wagoneer running again, quite well in fact. Unfortunately, recent rains have revealed just how non-waterproof both it and my Falcon are. Stupid NorCal…I miss having like 4 rainy days per year.

            • danleym

              Nice (on getting the Wagoneer on the road again)! I'll join you in ending the serious comments.

              My Spirit has been on jack stands for the past 3 weeks as I try to find time to replace the master cylinder. Well, actually, that would have been done, if I had stuck with only that. Instead, I decided now was a perfect time to paint the calipers and drums, with paint that requires baking the parts in the oven. Which still shouldn't take 3 weeks, but I've barely been able to find a minute to touch the car. Class is done next week, after which I should be able to get it finished, but I'm sure snow will come down just before the car does.

    • http://hooniverse.com/ Tanshanomi

      I saw an old Corolla FX-16 in a buy-here-pay-here lot several years ago and pulled in to check it out. The interior was completely trashed, and IIRC, it had around 180-200K on the clock. I asked the guy how much. "$5600." I must have looked visibly shocked, because after a few moments of stunned silence he added, "I'm open to negotiate, But only if you're thinking about paying for it in cash up front."

      I'll bet.

      • gearz1

        The government went after organized crime for Loan Sharking with a passion, mostly because they were not getting a percentage.

        • fodder650

          Actually Pennsylvania took a very different approach to it. They offered short term loans up to $250 at 10% interest. Half of that interest would go back into your account as soon as you paid it off and you were only allowed one of these loans until you paid an old one off.

          Spend some time looking at the various programs at your state's treasury website. It makes for an interesting read.

  • OA5599
    • danleym

      I had never heard of this before. Thanks!

    • http://www.sub5zero.com/ Tomsk

      Even if there is some truth to that (and I'd be surprised if there isn't), here in L.A. the Red Cars and Yellow Cars were also victims of their own success. When they first started running, they allowed people to live farther from their jobs. This led to the birth of suburbs and subdivisions. These suburbs and subdivisions meant more street crossings and street running (as well as more stations and local stops), forcing trip times upward. And longer trip times meant they became less and less attractive for most commuters.

      I often wonder what the region would be like today if CalTrans' forebear had just given up on freeways after building the 110, the 10 and maybe the 5 and subsequently engineered a buyout/partnership with Metropolitan Coach Lines (the buyers of Los Angeles Railway and Pacific Electric's passenger operations) to update and maintain the rail systems. Of course, something like this (some Red Car lines would have been relocated to the medians of new freeways) was put in front of voters, but they resoundingly rejected it as a Trojan horse containing nationalization (statization?) of private enterprise, ergo socialism (the real socialism, not the bastardized modern definition). Oh well…

      • Van_Sarockin

        It's all true. A proven, nationwide conspiracy, including a court finding and a trivial fine. GM, Firestone and Standard Oil. Private cars bring more profit to manufacturers and oil companies, plain and simple. Most public transit lines started as private companies, many to move people out to the suburbs, to make their development possible and profitable. One the suburbs were built and sold to homeowners, the developers lost interest in the transit, cut back on service and maintenance, leading to rapid declines in service and safety. The government had to step in and rescue the transit lines, which had become indispensable, and here we are today.

  • http://www.washington.edu/news/archive/52703 mdharrell

    In terms of its widespread real effects (and the pervasive stranglehold it would have continued to have on the industry, had it not been challenged and overturned), the answer is the Selden patent (as amended, and amended, and…) and the Association of Licensed Automobile Manufacturers.

    Even Selden's alleged "1877" car is a much later fabrication:

    <img src="http://farm7.staticflickr.com/6029/5922354613_4c931d34a9.jpg&quot; width="400">

    • http://PFMTechnology.net IronBallsMcG

      I'm ashamed I wasn't familiar with this.

      • fodder650

        If it helps neither was I. I just went to Wiki and read up on it myself. It was the first time I had heard there was a patent lawsuit over the automobile.

    • jimnaz

      If I remember right in reading about it years ago… Henry Ford was among others filed suit against Selden. Also the car above was built around 1905 or so… not 1877.

  • Impalamino

    I'll add the whole Corvair/Nader kerfluffle, which has two parts: Nader's designation of the Corvair as "unsafe at any speed" due to it's suspension design, and GM's subsequent bungling of the investigation into Nader. Ultimately, the president of GM had to apologize to Nader in front of a Senate subcommittee—fairly scandalous.

    • http://hooniverse.com/ Batshitbox

      It was unsafe at any speed because the heat exchangers pumped CO into the cabin, thus it could do you injury at a long red light.

  • Frere P.

    Frauds like this are hardly limited to the U.S. In Turkey there is a notorious serial fraudster named Fadil Akgunduz ('Jet' Fadil ). He raised money around 200-2002 to fund a car developed and built 100% locally.

    He seems to have been a combination JZD (promising to establish a factory in an impoverished region), Madoff (preying on solidarity due to ethnic origin), and televangelist (cloaking himself in religion). One hell of a fraudster trifecta.

    It is said that he personally got away with something in excess of $130 million, but the numbers vary widely. Not so much money by international standards, but a good day's work nonetheless.

    One other thing, I'm a bit surprised that nobody has brought up Colin Chapman yet.

  • Devin

    Note: Someone else might know the specifics a bit better.

    New Brunswick Premier Richard Hatfield and the Bricklin. Once upon a time, there was a premier of a Canadian province, who wanted to be re-elected. He decided one way to do this was to attract the auto industry to the province, so he convinced Malcom Bricklin to bring his car there. Part of doing that was basically funding the company, so the Bricklin was pretty much entirely funded by the province of New Brunswick.

    In spite of spending $4.5 million of the province's money on the company, he was re-elected and served as premier until 1987, when a number of other scandals completely wiped his party out of the province's legislature. More recently, a musical was made about it.

    • gearz1

      This Musical, was it titled "Laughing All the way to the Bank"???

    • Kris

      I live in New Brunswick and the spectre of the Bricklin will haunt this province for the rest of the century, I'm sure.

      When Malcolm pitched the idea he had ONE car – a handbuilt prototype based on I believe a Datsun 240Z. The Quebecers sent him here. NB basically funded all of the tooling and R&D costs with what was intended to be production money – Bricklin kept spinning the tale of hiow the R&D, tooling, etc were already done but he needed plant funds. What he was doing was living high on the hog with family members hired as key management staff (nepotism ranking high on his list).

      The vehicles themselves were never meant to be sold in Canada, only to Americans.

      Bricklin eventually wound up spending 24 million 1975 dollars (something like 100 million today) on the project. Most of the money was provincial funds; private investments were a very small percentage.

      • Van_Sarockin

        Same basic play for Delorean in Northern Ireland.

        • Kris

          Yeah, not far off the mark.

    • Dean Bigglesworth
  • http://hooniverse.com/ Tanshanomi

    In more recent days, the oops-not-really-40-MPG Hyundai.

  • Pellematt

    Saab and Victor Mueller…… Must be up there, pretty close to the top…!

    • mallthus

      Only if you include GM's shenanigans, the EIB's refusal to accept Antonov's money, Lofalk's attempts to do a side deal and the Swedish government's utter incompetence in the matter.

  • http://www.automobile-catalog.com/ P161911

    The GM bailout/bankruptcy will probably go down as this. Unsecured creditors got paid before the secured creditors, ignoring a long history of bankruptcy law.

    (Don't want to start a whole political debate on wither or not the bailout was needed.)

  • erikgrad

    Another scandal, though still unfolding in its full detail, is the tumultuous relationship Lotus, Dany Bahar…and Dany Bahar's expense account.

    • dukeisduke

      He must have been taking lessons from Ernst Lieb at Mercedes-Benz.

  • dukeisduke

    When I was a teenager in the early '70s, I regularly listened to Ed Busch, who had a late night radio talk show here in Dallas. His staple was off-the-wall guests like Charles Berlitz ("The Bermuda Triangle"), Erik von Daniken ("Chariots Of the Gods", about ancient astronauts who supposedly visited or colonized the earth), someone who had written a book about Edgar Cayce ("the sleeping prophet") – weird guests like that.

    Elizabeth Carmichael was a frequent guest on his show for awhile, touting her/his "invention", that is until the Feds caught up with her/him. I wasn't surprised to learn that she was a he, since "she" had an awfully deep voice.

  • danleym

    E85. And the earlier similar product, gasohol.

  • http://www.williesrepair.blogspot.com lilwillie

    I have two that always bugged me. The first was the Rick Hendrick/Honda Accord scandal from long ago. It always bugged me how that went down and how it ended. The Presidential pardon and now he is the poster boy of greatness in Na$car. How the hell is this guy even allowed out in public..

    Firestone/Ford Explorer disaster that lead us to being force fed TPMS. Many never realized how it ended because a little incident called 9/11 took everyone's attention away from the congressional hearings.

    I also find no coincidence that the fed is involved in both of these. Money talks, and it talks real well on capital hill.

  • Van_Sarockin

    Fish carburetor.

    Death of Tucker Motors

    Bernie Ecclestone's F1 sale – One bribed German has already been convicted, more proceedings underway, with claimed damages of 650 million.

    Why Ford released the Model T first, when the Model A was so much more advanced. AND WHAT DID THEY DO WITH MODELS B THROUGH S? THEY ARE ALL IN ALIEN MOONBASE ATLANTIS!

    • http://www.automobile-catalog.com/ P161911

      The Model A came out in 1904. The models B through S are just kept squirreled away by old guys who are busy polishing their brass.

  • http://roadworkuk.com Rust-MyEnemy

    <img src="http://images.drive.com.au/drive_images/Editorial/2006/09/26/historyM_m.jpg&quot; width="450/">

    The HDT Director, a car relatively unknown outside Australasia.

    Peter Brock, Racing Driver and project manager for HDT, insisted that every car be fitted with a device called an "Energy Polariser". This was a little box which, the blurb claimed; "causes all molecules in its sphere of influence to be aligned or polarised… the overall effect is to reduce overall vehicle noise, achieve greater efficiency of the power train and steering systems, improving engine and suspension performance".

    Stolen, piecemeal, from Wikipedia (to save me typing it)

    "…HDT and Brock's association with Holden ended sensationally in 1987, after Brock began fitting a device known as the "Energy Polarizer" to HDT vehicles. Regarded as pseudoscience by Holden and the vast majority of the Australian motoring community, a new VL series "Director" model was then released in February 1987 which incorporated not only the Polarizer but also a new independent rear suspension system developed by HDT without Holden's approval. Holden ended its association with Brock as he had refused to supply a Director for test purposes and Holden was therefore unwilling to honour warranties on any cars thereafter modified by Brock's HDT operation."

    Whether or not the "energy polarizer" was anything other than copper-bottomed bollocks was never determined.

    And the car looked shit.

    • mallthus

      I'm officially a Holden geek and I never knew about this one. Thanks for expanding my horizons.

  • Van_Sarockin

    Stock car racing and NASCAR.

  • Corvette_Poncho

    What about leaded fuel or TEL. It made people crazy, harmed kids and polluted the world. After it was banned, IQs went up and crime went down! The guy who invented, Thomas Midgley, has done more damage to the environment that anyone else in the history of man. He also invented CRCs! I can't make this stuff up!

    • gearz1

      Yes,youcan.

    • Sid Troon

      Remember how Midgely died? After he was paralyzed with polio, he invented a machine to pull up the blankets on his bed. One day it strangled him. Oops! I can't make this stuff up either. . .

      • Christopher

        Poor Midgely. At the time he developed leaded gasoline, neither he nor anyone else had any idea of the environmental downside. I've heard it said that, when he learned of it, his guilt motivated him to invent freon as a more environmentally-friendly alternative to the benzines and ammonias that had been used in refigeration up to that point. Of course he had no way of knowing about CFC's affect on the ozone layer. He was not a lucky man.

  • ConstantReader

    Daewoo

    • Devin

      To elaborate on this, Daewoo Chairman Kim Woo-Choong was accused of accounting fraud, $43.4 billion dollars worth. After the company went bankrupt during the Asian financial crisis, he fled to France on the run for 5 or so years, and when he finally was returned to Korea he was convicted and sentenced to 10 years in prison.

  • mallthus

    Seriously? Nobody went to the easy example that is Tucker?

    <img src="http://upload.wikimedia.org/wikipedia/commons/thumb/4/4f/Tucker.jpg/667px-Tucker.jpg&quot; width=600>

    • Van_Sarockin

      Ahem!

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