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.

In the late 1960s, Rolls-Royce was adversely affected by the mismanaged development of its advanced RB211 jet engine and consequent cost over-runs, though it ultimately proved a great success.

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.

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.

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.

Two Eagles powered Alcock and Brown's first non-stop trans-Atlantic crossing by aeroplane mounted on their converted Vickers Vimy bomber.

[8] 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 ($200,715 in 2023 dollars [9]).

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.

[citation needed] In 1931, Rolls-Royce acquired Bentley, the small sports/racing car maker and potential rival,[2] after the latter's finances failed to weather the onset of the Great Depression.

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).

[12] 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 [13]) until 2002, standard Bentley and Rolls-Royce cars were usually nearly identical – Bentleys were badge engineered; only the radiator grille and minor details differed.

[14] The British government built a shadow factory in Crewe in 1938 for Rolls-Royce where they could build their Merlin and Griffon aero engines.

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.

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[2] in particular in Alvis's FV600 range,[nb 2] Daimler's Ferret, Humber's Hornet and Pig and Austin's Champ.

[2] West Riding manufacturer of diesel shunting locomotives, Thomas Hill (Rotherham) Limited, was added to the group in 1963.

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.

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.

[15] An exchange of assets followed with Rover and in the post-World War II period Rolls-Royce made significant advances in gas turbine engine design and manufacture.

Amongst the jet engines of this period was the RB163 Spey, which powers the Hawker Siddeley Trident, BAC One-Eleven, Grumman Gulfstream II and Fokker F28 Fellowship.

According to the prospectus published for the 1987 issue of shares to members of the public Rolls-Royce was by then one of only three enterprises outside USSR and China able to design develop and produce large gas turbine engines.

[16] Leavesden Aerodrome, Watford was originally owned by the Ministry of Defence and used during World War II for the manufacture of Mosquito and Halifax aircraft.

[20] There were said to have been acrimonious telephone conversations between US president Richard Nixon and the British prime minister Edward Heath but these were subsequently denied.

Responding to questions as to how the situation could have arisen the chief executive advised that in their calculations they were guided by the success of their estimates in the launching of their Spey engine.

[22] The situation was handled in the usual manner with the assets being sold for cash, in this case to the government, leaving the massive liabilities to be dealt with by Rolls-Royce Limited using the funds realised by the sale.

[23][nb 3][24] In the meantime the government would use the assets to continue the activities of the aero-engine, marine and industrial gas turbine and small engine divisions that were important to national defence, the collective programmes with other countries and to many air forces and civil airlines.

[25] A new company (1971) was incorporated that May to purchase substantially the whole of the undertakings and assets of the four divisions of Rolls-Royce connected with gas turbine engines.

The continuing support of the trade creditors was also achieved by the receiver in spite of threats to demand immediate payments in full and to withdraw supplies.

On the day the chairman of Lockeed said "...we know that in airline service it (RB211) will prove itself to be one of the leading power plants in aviation history".

In June 1971, it acquired all the business and assets used by the motor car and diesel divisions of Rolls-Royce and Mulliner Park Ward.