The Years of the Eagle

Ian Lloyd

Chapter 5 in Rolls-Royce, 1978, pp 73-91 from Palgrave Macmillan

Abstract: Abstract At an Admiralty conference on aero-engines in September 1915 it was agreed that Rolls-Royce should spend £99,000 on new buildings and machinery to enable orders for an estimated total of 775 engines to be met. A sum of £25 per engine was allowed as additional compensation for this capital expenditure. Orders actually confirmed in 1915 had amounted to a total of some 500 engines, of which three hundred Eagles and one hundred Hawks had not been ordered until November.1 The contract for a new aero shop costing £16,900 was signed in December and machinery to the value of £14,600 was ordered. Negotiations were meanwhile being continued with Armstrong Whitworth and the French government. The terms for both contracts were identical, namely a minimum order of 1000 engines, and a royalty of 10 per cent on the invoice price. In January 1916 the negotiations with Armstrong-Whitworth ceased, as Johnson was not satisfied with the way in which the scheme was proceeding. This, as has been seen, caused some criticism. A conference was arranged, at which Claude Johnson, Bonar Law and Sir David Henderson were present, in an attempt to persuade Johnson to change his mind, but he persuaded the others that the company’s attitude was justified and no further steps were taken.

Keywords: Capital Expenditure; Aircraft Industry; French Government; Repair Shop; Aero Engine (search for similar items in EconPapers)
Date: 1978
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DOI: 10.1007/978-1-349-03911-1_5

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