This article was written by GGLC member Jon Rosner and originally appeared in the June and July 2003 print editions of the Chapman report
It looked like a Lotus Seven, it was lipstick red with what looked like a round black nose that stretched back a couple of feet to touch the hood. Tall black leather seats with a wear spot high on the driver’s side and California tags “7LOTUS7”, the engine plate said Steel Bros, New Zealand.
It had a Lotus 907 engine in it and what looked like a Lotus Europa front suspension. One of the Books on Sevens had Steel Bros manufacturing maybe two dozen with the 907 Type Engine and many more with Ford-Lotus Twin Cam engines. It was for sale, but it was sold just hours before my offer of interest was left on an answering machine.
Fast forward to December 2001 and a tall thin fellow with piercing but tired eyes. His name is Dan Weatherly. He is driving a very original brown Europa with a rare dealer-type installed air conditioning system. And he had a very interesting story to tell.
“In 1975 I was looking around for an American sports car. I bought a new Corvette, it wasn’t even a real sports car in 1975. Then I started looking around and came across Steel Brothers in New Zealand. They were going to be celebrating their 100th Anniversary in 1977. They had started off by building wagons, then trucks – heavy manufacturing.”
“I started calling Dan Dixon, and back then transatlantic calling was no where near as common as it is today. And they took me seriously. Dixon had already brought the S4 Seven to New Zealand and were building the S4 since Caterham had gone back to making the S3.
The first time I went over there I got the chance to travel around New Zealand. And one day while I was walking around with David Dixon he told me to (with some sense of urgency, hands waving as story told) ‘hurry, come up to the top of the hill !’
So I rushed up and the he pointed out to me, in the middle of Auckland Bay, a single ship. He then proceeded to tell me, with a straight face, that this was the New Zealand Navy! He was teasing of course, but that was the attitude back then.”
“After two months of talking I wanted to buy a car from Steel Brothers and have it legal in the U.S. Dave Dixon was real car guy, and he was also the Project Manager for building the Series 4 Type 7 and a CPA.” “I told him that ‘I want to buy a car from you and legalize it in the US.’ This was an export hungry country!”
“At the time I was a twenty-seven year old investment salesman without a lot of money. Needless to say, I had to be more than I was, or this company would not have even begun to talk to me. Steel Brothers were excited by the idea of selling 200 cars per year in America.” Rod Steel was going to be a celebrity because he was going to do
something that hadn’t been done — he was going to build cars to sell to the US.”
“It was now June of 1977, my second trip to New Zealand.” I had a meeting with Rod, showed him the docs and two hours later we had a deal. Steel Brothers were builders of big tractor trailers, this was a sideline.”
“The first car I brought in (to the US) was a white Weber carbed S4 with a Ford-Lotus Twin Cam engine. The big problem was the evaporative system, so I went to fuel injection. Then Dave Dixon called and said that we can’t get the Twin Cams – This was AFTER I’d already paid the LA gray market importer with the mechanical whiz to do
the test engineering preliminaries leading to making it an EPA/DOT approved car. That was the bad news, the good news was that Lotus had the 907 engine legally in the US!!”
“Steel Brothers took the mold for the S4, cut it in half to widen it, and made the seats four inches wider. This car was not made to fit Colin Chapman, it was made to fit an American. They dropped in the 907 with the five speed and a higher rear axle, and shipped it to Olsen Engineering is Los Angeles.”
“They were a US Environmental Protection Agency approved firm. And I wanted to piggy-back on Lotus’ 50,000 mile Emissions Test. We had to test for four thousand miles in an approved test routine. It passed the Duration Test and the car was shipped directly to an E.P.A. Lab in Ann Arbor Michigan. “It couldn’t be driven. It couldn’t be moved. I didn’t see it for the first 3 months it was here.”
This was still 1977 timeframe, and there was a problem. The engine overheated every time the damn thing ran. E.P.A. does their testing inside, on a dyno. The gear-
shift knob had been stolen in transit. The result was that each time he ran the car through, the test engineer missed the shift, and the E.P.A. had the test stopped after five tries. I was real upset – so I asked them to ‘put a *&?#* shift knob on it’ and it passed on the sixth try (the air was filled with a thunder-cloud of his expressed exasperation.)”
“The next day I called the head of the E.P.A. and pleaded with the secretary, I told her the whole story, every (blessed) mistake, fifteen minutes (more steam.) I called the Project Manager (at E.P.A.) the very next morning and he told me that the car was done, it had passed everything – and then he laughed and asked me whom I knew in Washington. So the car came out clean !!!!”
“They gave me my 1978 EPA/CA certificate. That was REALLY an accomplishment I was proud of. It was legal, it was real, it could be sold in a dealership……and we did it on pennies!!”
“DOT did not require a crash test, but they did require it to meet bumper standards. The black nose on the car (rubberoid) met the five mile per hour test.” “Actually, we designed the 5 mph bumper but were never required to test it. The red 7 with the black nose had the only legal bumpers !!” “The engineers had said it would work, and we went with it.” “The DOT will let you say that this car is legal and that it meets all the standards… then you can start production.” “The kicker is that if you are found in violation of ANY of these (standards) then you can be fined $10,000.00 per violation, per car! We sent our documents in, done, we were legal.”
“Now we had our DOT/EPA street legal SUPER 907. I went to a contract attorney in Oakland and told him that I wanted a twenty year contract for exclusive rights. Then I placed a 3 by 5 ad in AUTO NEWS for the car and got 150 phone calls and 70 dealers sent me the required letterhead document stating that they would meet the minimum purchase of 5 cars.”
“I took the contract, the EPA and DOT docs, the sold order docs for more than the 75 cars they wanted to see orders for, flooring financing from Bank of America – which is financing for cars, and went back to New Zealand ready to do business.”
“Everything at the factory was as it was four months before when I was last there. None of the improvements I had been promised had been made.” “I had been paying the engineers OUT OF POCKET. There were no investors, it was all smoke and mirrors.” “But we signed the contracts and I stayed two weeks to see that they were making progress.” “I was a NOBODY, with NO money, but that I got THE job done.”
“My contract said that I had to buy a minimum of 200 cars each year to maintain my exclusivity. That’s an important number.” “In November, I called Lotus and said that I wanted 500 motors.” “I had been putting the pressure on Rod, so Rod had called Roger Putnam, Sales Manager for Lotus, and Mike Kimberly, Managing Director of Lotus over in England. They did not really want to sell him 200 907 motors because of the liability….. It was not worth it to them. But remember this was neither a yes nor a no.” Then Lotus called Rod Steel and gave him a definite no to 200 motors, the minimum purchase was 500 motors. And that was my play to goad Rod Steel into getting things moving again.”
“I was going real strong. I got Rod Steel to allow us to manufacture cars on my 3rd trip which was now August 1977.” But I was broke. I had left San Francisco with my American Express card and $5 cash. I could live on my AMEX card for one month.
I was in New Zealand for two months. I then got Rod to sign over the rights to build the S4 Seven and was preparing to leave.” “David Dixon and I formed a new company called ‘NEW ZEALAND AUTO MAKERS’ for the sole purpose of building the cars. “Dave had borrowed $60,000.00 of which I put $25,000.00 into my pocket. $20,000 was to pay the woman I had borrowed the $10,000 from.” “I had my car company. I had my contract with Lotus. I had all the pieces, but what I didn’t have was the money to make it come together.”
“We didn’t have any money. This would take three to four million to do. It would take a long time to get parts from England and Japan. There had to be a HUGE amount of float.” “Dave was a CPA and he knew a huge number of financial people. Dave started introducing new people at me. He had a friend in Auckland, and that firm wanted to put us together with another group.” “ This Aukland broker/dealer put us together with MOTORSPORTS INTERNATIONAL whose staff flew down to Christchurch for meetings and hot laps with a professional driver. The result was that we went into our meeting as high as marathon runners.
“We did the wine and dine route, we wanted MOTORSPECS INTERNATIONAL to take a 25% position. They were impressed with the car, and with the market for it – They were all smiles. They were a big company like a Target or a Walmart, but they were in the auto parts business like a Kragen. Dave Dixon and I were the two principals and we met everyone (at MOTORSPECS) from the Secretary to the CEO.” “One of the Board Members was a major stakeholder as his parents had started the company.”
“MOTORSPECS said they would take a 25% position for $350,000.00, not even close to what we needed. We needed three million to secure parts, car flooring and working capital. The Bank of New Zealand sat down with MOTORSPECS, David Dixon and myself and told us that they wanted collateral.”
“So I said, ‘look we need the bulk of the money for parts – hard assets.’ “These were the giants of New Zealand and I was the little guy.” “But I told them, ‘lend us $ three mil for parts which will be worth $ twelve mil in cars.’
“But what they did give us was the money to floor cars in America – with NO collateral from MOTORSPECS. The deal was done, the bar was opened, and everyone was drinking and telling jokes.”
“The proposal was done. I had my $3 million from the Bank of New Zealand and I had MOTORSPECS. One of the MOTORSPECS board members wanted to come to America, so I took him to Los Angeles and San Francisco.”
The MOTORSPECS Board Member was excited – he went back to New Zealand for the Board meeting, but he never made it to the meeting….. David Dixon too was out of the room, he had been sent to Australia – my main men were NOT at the meeting….”
“The decision came down – MOTORSPECS was NOT going to take a position – there was NO vote. This was a done deal and the ‘good ole boys’ had put in the word – the deal was dead.”
“I would have made this deal happen – BUT I made a big mistake. I alienated Rod Steel instead of befriending him, I had run out of money, I had run out of steam, I just didn’t which way to turn, and I was pretty upset.” “I started to fight Rod Steel, and I’m sorry I did.”
“The fourth trip was in March of 1979, after the ‘NO’ vote at MOTORSPECS everything that was good was no longer was there. I only had money for the airfare, the magic had vanished, and I went home.”
“Then three or four months later I got a phone call from Rod Steel’s attorneys. ‘He would like to import cars to the US but NOT through you.’ “ “’ What we would like to do is make a financial arrangement – and give you some money’ – PUSHY – take it or leave it.” “I said o.k. – you know my position. They offered me my expenses and some money.” “My attorney said to get them over here. He told me that there is no way they are going to import cars without us. They signed for $500 per car AND expenses if any cars ever came over —— no cars ever came over.”
“I had spent just short of $100,000, Dave Dixon was badly hurt financially – I was TOTALLY broke. My Super 907, the red one was repossessed because I could not make the payments on my $10g note to Bank of America.”
The one US legal Super 907 California plate 7LOTUS7, made a brief reappearance at British Car Day in Palo Alto, it was for sale and rumor had it that the engine was not in great shape. Then it disappeared again. After a fair bit of sleuthing Dan found what’s left being used as a plant potter in Oakland, California. That might have become a sad ending, but Dan’s not a quitter. In the process of getting another Super 907 from New Zealand Dan made the decision to go back into the production of a Super 7 type cars! Dan’s plans looks pretty cool and anyone who knows an angel investor who wants to do a really hot Lotus 7 type car can reach Dan Weatherly at his home in Walnut Creek, California!! Just tell him that you heard a story about the guy who had a dream and came THAT close to making it happen.