| The RCA Engine Story Parts 3 & 4
Wednesday 21st January 2009
The RCA Engine Story. Part Three. by Peter Hogan
Dolphin Yacht Engines Ltd. 1978
Following the bankruptcy of R. Christoforides & Associates Ltd. in September 1978, I found myself unemployed and stranded in Bodmin, far from the friends and contacts that I had grown up with. Naturally I had seen the crash coming and had already considered some of the options open to me. One of these was to purchase the remains of RCA Ltd from the Official Receiver, and rent some small premises close by. This would have enabled me to offer a spares and repairs service to the owners of the several thousand Dolphin engines currently in service. With low overheads and a virtual monopoly on the servicing, this was a sound scheme.
I contacted the Official Receiver to express an interest and to try and assess what valuation was likely to be put on the assets. The factory was a double unit rented from the Bodmin Council, and so not included in the reckoning. The design and manufacturing rights of the RCA engine could not be included in the sale of assets either, for they belonged to me. RCA had always paid me a Royalty on each engine sold, and this prevented the company being offered for sale as a “going concern” to anybody who might wish to resume production.
The assets that the Official Receiver could dispose of were limited to the contents of the factory. The production jigs and tools and all the pattern equipment, which represented a huge investment, was virtually worthless and would have been sold as scrap. The machinery naturally had some value, but much of it had been modified to meet the company’s special needs, and a buyer would have been faced with substantial transport charges to remove it. The office equipment, heaters, lights etc. and the several tons of Dolphin engine parts in various stages of completion, completed the package, but all would have to be quickly removed as the Council wanted their factory back! The Receiver thought about £10,000 for the lot, with most of it going for scrap!
David Chapman had joined RCA at the Harlesden factory, more or less straight from school in 1969, and just before the death of founder, Richard Christoforides. He received a thorough grounding in engineering with us, and had worked as my assistant for a number of years before taking charge of the Bodmin assembly shop, shortly before the Liquidation. He was in the same boat as myself in as much as he was now unemployed, and stranded in Bodmin. He was keen to join me if a satisfactory deal could be worked out with the Receiver. He was game to invest his savings for a small share of the action, and this suited me well, for he was a powerhouse of energy and a tireless worker.
I approached the local Council to see if they were willing to rent suitable small premises to us, and was astonished when they suggested that we could take over one of the two bays that formed the RCA factory. It just happened the layout was such that one half of the original factory had been used for stores and all production was concentrated in the other half! If we could take this over we would walk into a ready-made production unit. Although sales of Dolphin engine had pretty well dried up, one or two boat builders were still using them. Tom Lack was obliged to use them because the available space in his catamarans was severely limited. He was most anxious that we continue to make engines, for without a supply he could not sell his boats. He was willing to provide us with capital or even buy the company, to ensure a continuing supply of engines. Other boat builders also shared his views. Now with the prospect of resuming limited production, suppliers of components were approached. All were willing to supply us, and many had stocks of material they were anxious to unload.
So it was at the Creditors meeting that David and I found that we had the support of boat builders, the local Council, and suppliers of engine parts and materials. We purchased the assets of RCA Ltd. for £7,000 which was a huge bargain, for we finished up with a complete working factory, full of spares and half finished parts, together with orders for several engines which we could complete largely from this stock.
David was delighted when I insisted he and I become equal partners. He had indicated what sum he was willing to invest for a small share of the action, and now the same amount was to make him an equal partner in a far more ambitious and prestigious undertaking. It was obvious that he would recoup his investment in no time, and still own a half share of the new company. He agreed that, as the designer, I should receive £10 royalty on each engine made, but little did I realise that with David I would be taking a cuckoo into the nest!
In order to start trading as quickly as possible, a ready made Limited Liability Company was purchased off the shelf. This was called Plydale Ltd. We now were able to open a bank account into which we paid £12,000 (a good proportion of which was redundancy money). After purchasing the assets for £7,000 we had £5,000 for working capital.
Trying to revive a business that has gone bankrupt is an interesting experience. In our case we were selling the same product, from the same address, and so naturally enough no one would give us credit. The Council wanted their rent in advance and the telephone, gas and electricity people required a substantial sum in advance before they would reconnect us at all, and then monthly accounting. Naturally all our suppliers expected to be paid COD.
Our first job was to remove everything from the other part of the factory, to brick up the openings in the walls, and to get an independent supply of gas and electricity into our half. This work cost us nothing, as we sold the light fittings and heating system to the new tenants which defrayed all expenses!
While this was going on, the name of the company was changed to the much more suitable Dolphin Yacht Engines Ltd. Cosira the government dept. that helps new businesses to start up, were most helpful during this period. For six months they paid roughly half of our wages bill, and this enabled us to engage some of the best ex RCA workers. The first batch of engines was completed quickly, mainly from spare parts in the stores. The next batch too required the purchase of only a small amount of material. In six months we were in such a favourable position that we were able to withdraw all our original investment, except for £2,000 each, and there was still about £7,000 in the bank! We were never overdrawn, and because we could not obtain credit, we owed absolutely nothing to anybody. David and I had agreed to take only a modest salary to ovoid paying unnecessary income tax, but when we had a caller who paid in cash, we simply split this between us.
In 1979 we exhibited at the Southampton Boat show. We constructed a stand that could be completely opened up at the front, to provide an attractive awning. The whole thing was proportioned so that it could be transported in a normal Luton bodied van. As this was a free-standing exhibit, we were allowed to run engines inside, as well as having the usual static displays and motorised sectioned engines. We needed orders now, as Tom Lack had stopped using our engines in favour of a French unit, and this was a blow to us. Plenty of repair work sustained us through the winter however, but things became very slack during the following summer. Financially we were still virtually in the same position as the previous year, with a bank balance of £7,000, but this was not growing.
We decided that our range of exhibits for the 1980 Boat Show should be vastly extended, and that by casting our net wider, we might be able to win new orders. In addition to the usual Mark 7 in direct drive form, and with a 2-1 separate reduction gearbox, we exhibited some dummy engines that could easily have been rushed into production had any orders been forthcoming. These included a 700cc flat four, a super sleek saildrive unit, and an incredibly light 28lb.miniaturised 15 BHP auxiliary for yachts, that were used purely as racing machines, based on the Hewland Arrow racing engine. The centrepiece was the Series 2, which was a 12 Volt, Single Direction Dolphin Mark 7 engine built into a unit with a Hurth proprietary reversing marine gearbox. As this unit departed from the Direct Reversing principal that had been a feature of all previous Dolphin marine engines and employed conventional controls, it was hoped that it might appeal to those who had been put off by the unorthodox reversing arrangements. The show was a complete flop, we did not secure a single order for any of the new engines, even though quite a lot of money had been spent on sales literature and advertising. Our bank balance was dwindling, and it was time to review the situation!
Various options were open to us at that point. The most obvious was to accept that the Dolphin engine had reached the end of its commercial life, and to stop manufacturing new engines. We could continue in business, offering spares and repairs to existing Dolphin owners along the line previously considered. For this purpose, modest and economical premises would be all that was required, making substantial savings over our existing prestigious factory, and neither would we need any staff.
Was it a mistake to have purchased the RCA assets then? No, far from it! Our investment in the company at that moment was only £2,000 each, but there was still £5,000 in the bank! We held the lease on a fine building, had lived off the company for two years and owned the entire contents of the factory, including all the production machinery. That left 19 finished engines and several thousand pounds worth of spares to hold as stock, and, for the reasons explained earlier, we had no trading debts whatsoever.
I hated the idea of sacking our small staff and moving out of a well established production unit, but I knew that if we failed to act fairly quickly, our bank balance would melt away and then we could be in deep trouble. We had considered taking on sub contract work, but little was available and that mostly unsuitable. One possibility was to sell a portion of the company, and take on new partners who would both inject new capital and bring in new ideas. I thought that the right person might welcome a chance like that, but David would not consider it. I had completely run out of ideas, and had begun to sleep badly with the worry of it all. I had no wish repeat the experience of a few years previously, when my health had declined so sharply, so I was quite receptive to a counter proposal from David.
As described earlier, we had exhibited a Dolphin engine that was built into a unit with a conventional Hurth FNR marine gearbox. This was not a running engine, but could have been completed had it generated any interest. As it happened, no orders had been taken. Despite this gloomy prognosis, David wished to get a Series 2 engine / Hurth Gearbox Unit into full production, and offer it for sale alongside the normal Mark 7. Although it would not be a difficult job, this would naturally take both time and money to achieve. David offered to finance the project himself, in exchange for an increased shareholding in the company. The advantages of such an arrangement were that, in the short term at least, we would retain the large factory as a running unit, and not be obliged to sack our staff. Should things not work out well, the spares and repair option was still open to us. David suggested that the new shareholding should be 45% /55% in his favour and that for this, he would personally guarantee the overdraft should one be needed. This also meant that David now had a controlling interest in the company, but this arrangement was no worse for me than it would have been had we taken on a new partner from outside.
David revelled in his new status as senior company director and engine manufacturer. Even so, I was astonished when his very first act, once he had control, was to buy himself an opulent company car (The latest Rover V8) using company funds and which put the bank balance well into the red for the first time. He was able to guarantee the overdraft against the assets of the company, of course, but this did not augur well for the future.
Whilst the Series 2 show engine could have been made to work in the form in which it had been exhibited, it would have been foolish to use the Siba single direction Dynastart again, as these were no longer in production. With this unit removed it would be necessary to provide a flywheel, a starter motor and generator and a means of timing the ignition, for the wonderfully compact Dynastart had provided all these functions.
q The obvious arrangement would be to follow normal car practice and to mount a substantial flywheel on the back of the engine. This would be enclosed in the usual bell housing which would unite the engine and gearbox into a single, neat unit.
q This bell housing would contain the starter ring gear or free wheel mechanism, and probably a transverse skew gear driven shaft that would drive the maintenance free Jabsco water pump. (Exactly as on the Excelsior Seafarer marine engine.).
q The flywheel rim, arranged to provide a non-adjustable ignition timing point, would activate a tiny magnetic pulse unit, as used on cars that operate without a distributor.
q A compact crankshaft mounted permanent magnet Kokusan Denki alternator, neatly enclosed at the front of the motor could carry an emergency start cord rim, under a detachable cover, and would yield 200, 360 & 390 watts at 1,000, 2,000 & 3,000 R.P.M. respectively.
This whole unit would have been extremely neat and tidy, with a total absence of belt drives. The replacement of contact breakers with a modern electronic system and the use of a maintenance free water pump would both be worthwhile improvements, but no attempt was made to get the new model into production.
We carried on much as before with a few sales of new engines and plenty of repair work, plus the sale of spares. We even did a spot of car trading and sub contract work. One project was to build prototype radio controlled toy trucks for a man who expected to make his fortune with them.
Generally it was pretty flat, but I was still totally unprepared for what happened next. It was on a Friday and we were expecting to close at 5pm. As the staff were departing for the weekend, David called me into the office and told me that I was sacked, and had one hour to remove my personal possessions from the premises! I said that I didn’t think that he could do that, but he assured me that he had taken professional advice and been told that There is no way he can hurt you, which I thought was quite extraordinary!
He agreed that my £2,000 loan to the company would be repaid, and I had no alternative but to accept the situation. While I was packing up, and actually while I was removing from my tool kit the special Dolphin engine tools that I intended to leave behind, a locksmith arrived and started to change all the locks! David clearly intended to keep me out, at all costs! I was absolutely astonished.
Apart from my loan, (which was eventually repaid without interest, and in small instalments), from that day onwards I have never received a penny from the company. David continues to make and sell a few new Dolphin engines (without paying my royalty) and having closed the original factory, has moved into a sensible and cheap small workshop. The present establishment, free from substantial overheads and concentrating almost entirely on the lucrative spares and repairs market, is almost certainly a nice little earner, particularly when such a high proportion of the takings are in cash. David, generally, seems to be doing quite nicely, although the company balance sheets that he was obliged to send to me (as a shareholder) normally showed losses. He was quick to point out that my shareholding was now worthless, and offered to take it off my hands for £1 a share. When I declined, a Rights Issue giving me the opportunity to invest a further £21,600 was proposed. Having declined that opportunity too, the Limited status of the company was removed, leaving David as the sole proprietor. He always pleads poverty whenever I speak to him, but then he wouldn’t have kept the business going for twenty years had it not been profitable, now would he?
The Series Two conversion was eventually completed by David himself, and is a sound enough job, even though he missed out on some great opportunities to produce a neat engine. Dolphin Yacht Engines continues in business to this day (June 2007), and produces what is still essentially the engine I designed 50 years ago, an astonishing production run.
Although the sale of these engines benefits me not one whit, it is flattering to think that they are still being produced, and may give pleasure to someone, possibly not even born when I designed it!
Renaissance for the Dolphin? In Part 4, discover what happened to the engine company after it was purchased
by the G T Jones Engineering Company in 2007.
The RCA Dolphin Engine Story. Part 4 by Peter Hogan.
In the year 2007, just twenty five years after I was ejected from the company, I learned that my former partner David Chapman was about to sell out to Mr. Glyn Jones of G. T. Jones & Co. of The Forge Workshops, Tresillia, Truro, Cornwall.
In my absence, David had continued producing the established direct reversing Dolphin Mark VII engine, before introducing the Series Two Dolphin in 1991. Fifty eight of these Hurth gearbox equipped Series Two engines were produced, with 16 having the stretched capacity of 420cc. More recently the Dolphin factory had concentrated on engine rebuilds, repairs and the supply of spares, but now he was retiring and moving to Wales.
The substantial Glyn T Jones Engineering Company is well established in the manufacture of pumping, mining and extractive machinery for the Cornish China Clay and mining industries. Their extensive workshops included CNC machining facilities with pattern making shops and foundries close by. However the decline in traditional Cornish industry had prompted Glyn to seek additional interests.
Glyn had been sufficiently impressed by a demonstration of a Mark VII Dolphin yacht engine, to wish to become the manufacturer of an updated version of this now fifty year old engine design of mine. The repair and servicing of existing Dolphin engines, would further involve his company in this new marine venture.
Considerable research and updating work is currently in hand prior to resuming production on a thoroughly modernized version of the Dolphin, which will probably be called the DOLPHIN MARK VIII. As further information becomes available, I will add it here.
A service centre is already operational, and this caters for all types of repair work, including complete engine rebuilding. All spares are again available, and reconditioned engines are available from stock.
The Address is: -
DOLPHIN ENGINES
Pollards Mill, Long lane, High Street,
ST. AUSTELL Cornwall PL26 7SX
Tel: 01726 824726 e-mail: enquiries@dolphinengines.co.uk
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Southampton Boat Show Stand.
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