Rolls-Royce Limited was a British luxury car and later an aero-engine manufacturing business established in 1904 in Manchester by the partnership of Charles Rolls and Henry Royce. Building on Royce's good reputation established with his cranes, they quickly developed a reputation for superior engineering by manufacturing luxury cars. The business was incorporated as "Rolls-Royce Limited" in 1906, and a new factory in Derby was opened in 1908. The First World War brought the company into manufacturing aero-engines. Joint development of jet engines began in 1940, and they entered production in 1944. Rolls-Royce has since built an enduring reputation for the development and manufacturing of engines for military and commercial aircraft.
In the late 1960s, Rolls-Royce was adversely affected by the mismanaged development of its advanced RB211 jet engine and consequent cost overruns, though it ultimately proved a great success. In 1971, the owners were obliged to liquidate their business. The useful portions were bought by a new government-owned company named "Rolls-Royce (1971) Limited", which continued the core business but sold the holdings in British Aircraft Corporation (BAC) almost immediately and transferred ownership of the profitable but now financially insignificant car division to Rolls-Royce Motors Holdings Limited, which it sold to Vickers in 1980. Rolls-Royce obtained consent to drop the '1971' distinction from its company name in 1977, at which point it became known once again as "Rolls-Royce Limited".
The Rolls-Royce business remained nationalised until 1987 when, after having renamed the company to "Rolls-Royce plc", the British government sold it to the public in a share offering. Rolls-Royce plc still owns and operates Rolls-Royce's principal business, although, since 2003, it is technically a subsidiary of Rolls-Royce Holdings plc, a listed holding company.
Henry Royce started an electrical and mechanical business in Manchester in 1884. He was first introduced to motor cars via a small De Dion-Bouton four-wheeler that had been purchased for him by business partner Ernest Claremont. In 1902 or 1903 he purchased a 1901 model two cylinder 10 hp Decauville. While Decauville had an excellent reputation at the time Royce with his fascination for all things mechanical found many things that did not meet his high standards and so he began making improvements. At the time his company was suffering from the effects of a decline in trade due to a downturn in the and competition from other manufacturers which had depressed prices. To investigate whether the company should diversify into the manufacture of motor cars Royce produced three examples of his own 10 hp experimental design.
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Testing of the first engine on a dynamometer began on 16 September 1903. The first assembled car was completed by 1 April 1904 and taken by Royce for a 30 miles (48 km) drive to his home in Knutsford and back. A week later it was dispatched to coachbuilder to have a body fitted. The other two cars were completed and fitted with bodies soon after. After initially being assigned the first car Claremont was given the second car to use. Initially he often had a horse drawn Hanson cab follow behind in case the car failed to proceed. The third car was sold to one of the other company fellow directors, Henry Edmunds. Edmunds was a friend of Charles Rolls who was proprietor of an early motor car dealership, C.S. Rolls & Co. in Fulham selling imported models. Edmunds showed Rolls his car and arranged for a meeting between Rolls and Royce at the newly opened Midland Hotel, Manchester, on 4 May 1904.
In spite of his preference for three- or four-cylinder cars, Rolls was impressed with the Royce 10, and in a subsequent agreement on 23 December 1904 agreed to take all the cars Royce could make. There would be four models:
a 30 hp (22 kW) six-cylinder model selling at £890, about £80,000 in 2021,
All would be badged as Rolls-Royces and be sold exclusively by Rolls in framed chassis form for the customer to arrange his own body supplier, with London coachbuilder Barker & Co. recommended. From its establishment Rolls-Royce did not produce complete cars until the introduction of the Silver Dawn in 1949. Instead, they produced a framed chassis with engine, gearbox and transmission, to which a body was fitted by a variety of coachbuilding companies, including Barker & Co., Hooper, H. J. Mulliner & Co., Park Ward and James Young.
The first Rolls-Royce cars, the 10 hp, 15 hp, 20 hp as well as the engine for the 30 hp were unveiled at the Paris Salon in December 1904. As the new three-cylinder 15 hp engine was not ready the chassis was incomplete. The 10 hp was similar to the earlier Royce car, but with further design and mechanical improvements.
In 1905 Royce designed a V-8 but only three were produced, of which one was sold before later being taken back by the company.
Incorporation
In 1906 Rolls and Royce formalised their partnership by creating Rolls-Royce Limited, which was registered on 15 March 1906 with capital of £60,000 with Royce appointed chief engineer and works director on a salary of £1,250 per annum plus 4% of the profits in excess of £10,000. Claude Johnson who had joined the company as Commercial Managing Director and Rolls both received £750 per annum and 4% of the profits. While the salary was less than the £1,000 Johnson had been receiving at the Automobile Club, he had a greater potential to earn more due to his profit share.
To increase the company's capital to £200,000 it was floated on the Birmingham Stock Exchange on 11 December 1906 with £100,000 of shares made available to the public to acquire the business of C.S. Rolls & Co. However, by the day before the flotation it was apparent that only £41,000 of the required minimum subscription of £50,000 shared had been subscribed to. off these Royce had purchased £10,000. The issue was resolved by company secretary John De Looze rushing from Manchester to Harrodgate to see wealthy businessman Arthur Harry Briggs, who had purchased the first “Light Twenty” car. Briggs agreed to purchase £10,000 worth of shares and in return was given a seat on the board. On 9 January 1907 it was announced that £63,000 had been raised.
The original directors were Arthur Harry Briggs. Ernest Claremont, Claude Johnson, C. S. Rolls and F. H. Royce. In 1907 Johnson recruited Lord Herbert Scott as a director, as he believed that having an aristocrat on the broad would make its cars more appealing to the wealthy.
The need to increase the company's capital had been mainly driven by the need for bigger premises if they were to increase production. After considering sites in Manchester, Coventry, Bradford and Leicester, it was an offer from Derby's council of cheap electricity that resulted in the decision to acquire a 12.7 acres (51,000 m2) site on the southern edge of that city. The new factory was largely designed by Royce, and production began in early 1908, with a formal opening on 9 July 1908 by Sir John Montagu.
Rolls-Royce 40/50
During 1906 Royce had been developing an improved six-cylinder model with more power than the Rolls-Royce 30 hp. Initially designated the 40/50 hp, this was Rolls-Royce's first all-new model. In March 1908, Claude Johnson, Commercial Managing Director and sometimes described as the hyphen in Rolls-Royce, succeeded in persuading Royce and the other directors that Rolls-Royce should concentrate exclusively on the new model, and all the earlier models were duly discontinued. Johnson had an early example finished in silver and named, as if it were a yacht, Silver Ghost. Unofficially the press and public immediately picked up and used Silver Ghost for all the 40/50 cars made until the introduction of the 40/50 Phantom in 1925.
The new 40/50 was responsible for Rolls-Royce's early reputation with over 6,000 built. Its chassis was used as a basis for the first British armoured car used in both world wars.
Along with Geoffrey Rowe, Edward Goulding became a board member in 1911. He was appointed chairman in 1921 and remained in that position until he retired in 1936 and was succeeded by Lord Herbert Scott, who had recently retired from military service, which allowed to accept the position, which he occupied until his death in 1944.
Rolls-Royce Eagle aero-engine
Aero-engine manufacturing began in 1914 at the government's request. The first model, the Rolls-Royce Eagle, entered production in 1915. Two Eagles powered Alcock and Brown's first non-stop trans-Atlantic crossing by aeroplane mounted on their converted Vickers Vimy bomber.
Springfield USA
In 1921, Rolls-Royce opened a new factory in Springfield, Massachusetts in the United States to help meet a three-year backlog demand where a further 1,703 "Springfield Ghosts" and 1,241 Phantoms were built. This factory was run by subsidiary Rolls-Royce of America, Inc., and operated for 10 years, with the first car being completed on January 17, 1921, that being a Silver Ghost with a documented chassis price of US$11,750 ($212,092 in 2025 dollars ). When the factory closed in 1931, 2,944 total vehicles had been produced. It was located at the former American Wire Wheel factory on Hendee Street, with the administration offices at 54 Waltham Ave. Springfield was the earlier location for the Duryea Motor Wagon Company, the location where the first American gasoline-powered vehicle was built. Bodies for American assembly were supplied by Brewster & Co. in Long Island City, New York.
Rolls-Royce Twenty
After the First World War, Rolls-Royce successfully avoided attempts to encourage British car manufacturers to merge. Faced with falling sales of the 40/50 Silver Ghost in short-lived but deep postwar slumps Rolls-Royce introduced the smaller, affordable Twenty in 1922, effectively ending the one-model policy followed since 1908.
Death of Claude Johnson
Claude Johnson died on 12 April 1926 and was replaced as managing director by his brother Basil.
Basil Johnson resigned as managing director, on 31 January 1929 and was replaced as managing director by existing general manager Arthur Sidgreaves, who was also made director. At the same time general works manager Arthur Wormald, was also made a director. W. M. Cowan, who was London general manager, has become general manager of the company. Len W. Cox, who has been with the company since 1905, was appointed sales manager.
Rolls-Royce Phantom
The new 40/50 hp Phantom replaced the Silver Ghost in 1925. The Phantom III, introduced in 1936, was the last large pre-war model. A strictly limited production of Phantoms for heads of state recommenced in 1950 and continued until the Phantom VI ended production in the late 1980s.
Bentley and Rolls-Royce
In 1931, Rolls-Royce acquired Bentley, the small sports/racing car maker and potential rival, after the latter's finances failed to weather the onset of the Great Depression. Rolls-Royce stopped production of the new Bentley 8 Litre, which was threatening sales of their current Phantom, disposed of remaining Bentley assets and using just the Bentley name and its repute.
After two years of development Rolls-Royce introduced a new and quite different ultra-civilised medium-size Bentley, the Bentley 3½ Litre. Advertised as "the silent sports car" and very much in the Rolls-Royce mould, it was a private entry by Eddie Hall (but supported by Rolls-Royce) in the 1934, 1935 and 1936 RAC Tourist Trophy sports car races on the Ards Circuit, where it recorded the fastest average speed in each year (ahead of Lagondas and Bugattis). This helped the Sales Department as old Bentley customers had been inclined to doubt that the new Crewe Bentley could out-perform its famous predecessors.
Immediately after World War II (when fully tooled pressed-steel cars were produced in the factory, rather than chassis sent to a coachbuilder for a custom-built body) until 2002, standard Bentley and Rolls-Royce cars were usually nearly identical – Bentleys were badge engineered; only the radiator grille and minor details differed.
In 1933, the colour of the Rolls-Royce radiator monogram was changed from red to black; because the red sometimes clashed with the coachwork colour selected by clients, and not as a mark of respect for the death of Royce later that year as is commonly stated.
Crewe
The British government built a shadow factory in Crewe in 1938 for Rolls-Royce where they could build their Merlin and Griffon aero engines. Car production was moved there in 1946 for space to construct bodies and to leave space for aero engines at Derby. The site was bought from the government in 1973. It is now Bentley Crewe.
Second World War
In 1940, a contract was signed with the Packard Motor Car Company in Detroit, Michigan, for the production of Merlin aero-engines for World War II in the USA.
Production focused on aero engines but a variant of the Merlin engine, known as the Meteor, was developed for the Cromwell tank. The Meteor's development completed in 1943 the same team at the Belper foundry restarted work on an eight-cylinder car engine widening its uses and it became the pattern for the British Army's B range of petrol engines for post war combat vehicles in particular in Alvis's FV600 range, Daimler's Ferret, Humber's Hornet and Pig and Austin's Champ.
Postwar diversification
Motor bodies
After the war, in 1946, Rolls-Royce and Bentley car production moved to Crewe where they began to assemble complete Rolls-Royce and Bentley cars with body pressings made by the Pressed Steel Company (see W. A. Robotham). Previously they had built only the chassis, leaving the bodies to specialist coach-builders. In 1939, Rolls-Royce brought one of the specialist coachbuilders completely in-house by buying the remaining capital of Park Ward Limited which, since 1936, in conjunction with Rolls-Royce had been building short production runs of all-metal saloon bodies on Bentley chassis.
In 1959, Rolls-Royce bought coachbuilder H J Mulliner and the two businesses were put together as H J Mulliner Park Ward.
Diesel engines Shrewsbury
Luxury cars did not fit with the new mood of post-war austerity. After starting design and development of what became their C series diesel engine range in 1948, Rolls-Royce began to produce diesel engines in 1951. By 1955, it provided diesel engines for automotive, railway, industrial, earth-moving and marine use.
Sentinel (Shrewsbury) Limited was bought in 1956. Sentinel made machine tools and industrial locomotives. Rolls-Royce took over Sentinel's Shrewsbury factory for diesel engine production and all its diesel work was transferred there.
West Riding manufacturer of diesel shunting locomotives, Thomas Hill (Rotherham) Limited, was added to the group in 1963.
In 1973, when Shrewsbury activities were put under the umbrella of new owner, Rolls-Royce Motors, the range of diesel engines included:
C range: 4, 6, and 8 cylinder engines with power output from 100 to 450 bhp. Used in generating sets, compressors etc., construction equipment, railway and other industrial purposes and marine propulsion.
Eagle: a modified version of the C range 6-cylinder engine named Eagle is used in heavy vehicles, their output 200 to 300 bhp.
D range: V engines with outputs from 400 to 750 bhp for generating sets, marine and railway applications.
Aero-engines
In 1907, Charles Rolls, whose interests had turned increasingly to flying, tried unsuccessfully to persuade Royce and the other directors to design an aero engine. When World War I broke out in August 1914, Rolls-Royce (and many others) were taken by surprise. As a manufacturer of luxury cars, Rolls-Royce was immediately vulnerable, and Claude Johnson thought the bank would withdraw its overdraft facility on which Rolls-Royce depended at that time. Nevertheless, believing that war was likely to be short-lived the directors initially decided not to seek government work making aero engines. However, this position was quickly reversed and Rolls-Royce was persuaded by the War Office to manufacture fifty air-cooled V8 engines under licence from Renault. Meanwhile, the Royal Aircraft Factory asked Rolls-Royce to design a new 200 hp (150 kW) engine. Despite initial reluctance, they agreed, and during 1915, developed Rolls-Royce's first aero engine, the twelve-cylinder Eagle. This was quickly followed by the smaller six-cylinder Hawk, the 190 hp (140 kW) Falcon and, just before the end of the war, the larger 675 hp (503 kW) Condor.
Throughout World War I, Rolls-Royce struggled to build aero engines in the quantities required by the War Office. However, with the exception of Brazil Straker in Bristol, Rolls-Royce resisted pressure to license production to other manufacturers, fearing that the engines' much admired quality and reliability would risk being compromised. Instead the Derby factory was extended to enable Rolls-Royce to increase its own production rates. By the late 1920s, aero engines made up most of Rolls-Royce's business.
Henry Royce's last design was the Merlin aero engine, which was first flown in prototype form in 1935, although he had died in 1933. This was developed from the R engine, which had powered a record-breaking Supermarine S.6B seaplane to almost 400 mph (640 km/h) in the 1931 Schneider Trophy. The Merlin was a powerful supercharged V12 engine and was fitted into many World War II aircraft: the British Hawker Hurricane, Supermarine Spitfire, de Havilland Mosquito (twin-engine), Avro Lancaster (four-engine) (a development of the Avro Manchester with its unreliable Rolls-Royce Vulture engines), Vickers Wellington (twin-engine); it also transformed the American North American P-51 Mustang into a competitor for the best fighter of its time, its engine a Merlin engine built by Packard under licence. Over 160,000 Merlin engines were produced, including over 30,000 by the Ford Motor Company at Trafford Park, Manchester. During the war most Rolls-Royce flight testing of engines was carried out from Hucknall Aerodrome. The Merlin crossed over into military land-vehicle use as the Meteor powering the Centurion tank among others. Many Meteor engines used engine blocks and parts that failed requirements for high performance engines, but were suitable for use in the derated 480 kW (640 hp) Meteor.
