NOBODY paid much attention to the middle-aged passenger on the flight home from Shanghai to London earlier this month. He made no fuss on the long trip back to Britain and kept his thoughts to himself.

Slumped in his seat, he probably looked a bit glum to be a tourist.

A day earlier, John Towers had checked out of the Pudong Shangri-La, one of the most impressive hotels in China. He was a broken man.

During the long days in Shanghai, Mr Towers had found himself with plenty of time to admire the magnificent views of the city's waterfront from the hotel windows.

For while thousands of British workers at the MG Rover Longbridge factory believed Towers was conducting last-minute negotiations to clinch a Chinese rescue deal, the truth was rather different.

Although Mr Towers and his team had been talking to the Shanghai Automotive Industries Corporation (SAIC) for months, things had come to an impasse.

A team from the Department of Trade and Industry was now doing all the talking for Britain. Towers could only watch from the sidelines and hope that the civil servants could pull a white rabbit out of the hat. They couldn't, and now MG Rover lies in ruins.

It was all supposed to be so different.

Five years ago, on May 9, 2000, Towers drew up to the factory gates of the giant Birmingham car plant he had just bought for £10. As he stepped from his chauffeur-driven metallic green Rover 75, he was mobbed by jubilant workers, overjoyed he had clinched a deal to purchase the company.

Mr Towers was the man who had coined the name Phoenix for the plan that would lead to the sale. He came to the deal as a member of the West Midlands Training and Enterprise Council (TEC), but had a strong emotional attachment to Rover.

He had been the company's chief executive during the British Aerospace years, but had backed the wrong company by telling BMW that Honda was his preferred partner just days before the Germans took over. No one was surprised when he left.

The other members of the buy-out team were John Edwards, a Midlands-based Rover dealer, Peter Beale, who was Edwards' finance director and Nick Stephenson, who was a non-executive director of a motor sports manufacturer called Lola Cars.

Initially, all Mr Towers did was to "make a few phone calls, and check a few facts", but he soon found himself conducting negotiations on behalf of the so-called Phoenix Consortium.

Soon, Phoenix found itself in the driving seat, with Mr Towers at the helm.

The original Phoenix project called on BMW to sell MG, Mini and Triumph or Austin Healey - names that retained a strong affection among enthusiasts that were perfect for reinvention as high value (and high profit) sporting cars. It also recognised the need for an association with a global car maker to provide a platform to use as the basis for replacements of the 25/45 models. The DTI even helped sound out DaimlerChrysler, Volkswagen and Honda - to no avail.

This plan could have worked. The new Mini has been a tremendous success around the world, selling in the kind of numbers MG Rover could only dream about in recent years.

A Triumph or an Austin Healey would have been a hit with the kind of drivers who now go to work in a BMW.

And that's precisely the reason why BMW said no. Instead, it offered the Rover name (on licence) and MG. It wouldn't sell the Mini brand under any circumstances and retained the other two marques for possible future use.

Bizarrely, at their first serious meeting, Norton Rose, the financial team working for BMW, told the Phoenix members that they were already working on a project with the codename Phoenix.

With a totally straight face they suggested a different name: Project Crufts. Given what a mangy dog Rover turned out to be, they probably got it right first time.

Initially, John Towers talked of production figures in the 250,000-275,000 region. This was later scaled back to 200,000. MG Rover would never get anyway near.

Everyone was sceptical. None of the high street banks would extend Phoenix credit, and when Downing Street asked a number of industry figures what they thought, the response was unanimous: in a cut-throat industry suffering from over-supply, the plan wouldn't work.

Nevertheless, it went ahead. The deal was sealed by Towers with a glass of champagne and a bacon butty.

The following lunchtime, Mr Towers swept up to Longbridge. It must have been the sweetest moment in his career.

Years later, he would reveal how a liquidation team was already inside Longbridge as the deal was concluded. They were swiftly escorted off the premises by Rover security satff.

It had been a long journey for Mr Towers. He had grown up in County Durham, where he was educated at a well-respected grammar school (Durham Johnston), before leaving to gain a degree in mechanical engineering at Bradford University.

He joined Perkins in 1966 as an apprentice and stayed for 17 years before moving to tractor maker Massey Ferguson, where he became managing director.

He moved to the Rover Group in 1988 and was appointed chief executive in 1994, before leaving following the BMW takeover.

At the time of the Phoenix deal, he was portrayed by the media as a knight in shining armour. In a comment he has surely come to regret, he said: "I was thinking yesterday that I really must develop a 'greedy bastard' profile because, unfortunately, people think you are a bit odd if your aims are modest."

With the benefit of hindsight, critics have lambasted the Phoenix Consortium for not seeking protection in the arms of a global car maker sooner. The truth is they tried, but nobody wanted to know.

Honda, so publicly humiliated when the group was sold under its nose to BMW, wanted nothing more to do with MG Rover.

Talks with Hyundai came to nothing, as did lengthy discussions with Proton.

Only the Chinese offered any kind of future, but by the time talks started with SAIC, last year, the cash was running out.

Now, MG Rover has collapsed, John Towers and his fellow Phoenix Four find themselves castigated as the bad guys. They took money out of the company, paid themselves good salaries, set up a lucrative pension and generally fiddled while Rover's cash burned. Or so the story goes.

Mr Towers sees it rather differently. He maintains his annual salary was modest by industry standards (less than £150,000) and says much of the cash taken out of the core business will now be made available for the benefit of the workers.

There's an alternative view, which casts Phoenix as the bad guys. It says that MG Rover was doomed from the start. Nothing the Phoenix Four did made any difference other than to give the supply chain five years in which to diversify and avoid the worst effects of the inevitable collapse.

Rover Group could have been sold to Volkswagen in 1988. At the time, the Germans were rebuffed by the Government. If VW had taken over, maybe Longbridge today would be a British equivalent of the Skoda factory, pumping out tens of thousands of cars.

Instead, the Longbridge workforce has nothing to look forward to other than redundancy. MG Rover's financial predicament means the payments are worth just £280 for each year of service.

Just a few pounds more than the cost of a room at the Pudong Shangri-La hotel, where John Towers' dreams of motoring greatness finally reached the end of the road.