In early 1913, Percy was joined by three of his brothers ( Victor, Stanley, and Allan) in a new business focused on manufacturing entire automobiles. This Riley Motor Manufacturing Company was located near Percy's Riley Engine Company. The first new model, the 17/30, was introduced at the London Motor Show that year. Soon afterwards, Stanley Riley founded yet another company, the Nero Engine Company, to produce his own 4-cylinder 10 hp (7.5 kW) car. Riley also began manufacturing aeroplane engines and became a key supplier in Britain's buildup for World War I.
In 1918, after the war, the Riley companies were restructured. Nero joined Riley (Coventry) as the sole producer of automobiles. Riley Motor Manufacturing came under the control of Allan Riley to become Midland Motor Bodies, a coachbuilder for Riley. Riley Engine Company continued under Percy as the engine supplier. At this time, Riley's blue diamond badge, designed by Harry Rush, also appeared. The motto was "As old as the industry, as modern as the hour."
Riley grew rapidly through the 1920s and 1930s. Riley Engine produced 4-, 6-, and 8-cylinder engines, while Midland built more than a dozen different bodies.
The Riley Brooklands was one of the most successful works and privateer racing cars of the late 1920s and early 1930s, particularly in hill climbs and at Le Mans, providing a platform for the success of motorsports' first women racing drivers like Kay Petrie and Dorothy Champney. It was based on Percy Riley's ground-breaking Riley 9 engine, a small capacity, high revving engine, ahead of its time in many respects. It had a hemispherical combustion chamber and overheard valves and has been called the most significant engine development of the 1920s. Its longevity is illustrated by Mike Hawthorn's early racing success after WW2 in pre-war Rileys, in particular his father's Sprite. But by about 1936 the company had overextended, with too many models and too few common parts, and the emergence of Jaguar at Coventry was a direct challenge. Victor Riley had set up a new ultra-luxury concern, Autovia, to produce a V8 saloon and limousine to compete with Rolls-Royce. Meanwhile, Riley Engine Company had been renamed PR Motors (after Percy Riley) to be a high-volume supplier of engines and components. Although the rest of the Riley companies would go on to become part of BMC, PR Motors remained independent. After the death of Percy Riley in 1941, the company began producing transmission components and still exists today as Newage Transmissions. Percy's widow Norah ran the company for many years and was Britain's businesswoman of the year in 1960.
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