At the London Olympia Show in November 1906 a new model by Rolls-Royce was exhibited. C S Rolls-Royce & Co. presented on their stand in chassis-form (ie chassis, engine and gearbox) the first example of the model which would become famous as the Rolls-Royce Silver Ghost. While on exhibition the model was not called the Silver Ghost in fact, but described simply as the Rolls-Royce 40/50 hp. This indicated the horsepower figure for motor tax purposes (deduced from the cylinder bore dimension using a formula known as the RAC Rating) which came out at 40 hp, and the actual output which was given as 50 hp.
The name Silver Ghost was a later creation of C G Johnson and at first was used only for one demonstrator. Curiously though during the time that the model was being produced this name found more acceptance than the term given by the factory and in the end was in general usage for all examples of this model.
Production in 1907 was limited to about four cars per week - after the new works in Nightingale Road in Derby opened in July 1908, a higher production rate was possible. Work in the new factory concentrated entirely on the Silver Ghost, a decision taken because the orders for the Silver Ghost could not be dealt with in reasonable time.
A material increase in capacity from 7,036 cc to 7,428cc in 1909 was attained by a longer sroke. It did not take long for it to become obvious to both Rolls and Johnson that a considerable number of drivers lacked even basic skills in how to handle a motor car. Rolls-Royce opened a drivers' school of instruction which held its first training course in 1910. No other manufacturer offered the benefit of a driving school and effective advice regarding the choice of coachwork at that time. This service was followed up by the provision of a service which ensured the car's uninterrupted readiness for use. Travelling mechanics visited the customers regularly or on request and carried out maintenance work or repairs immediately in the owner's own motor house.
The Silver Ghost dominated the Austrian Alpine Rally in 1913 with a top speed of 80 mph, and although the outbreak of the First World War in 1914 raised fears that the company might have to close because of lack of orders for their class of car, production was kept alive by the provision of armoured cars based on the Silver Ghost chassis. The longevity of these cars is documented by the fact that several were still in regular use at the outbrake of World War II. Between 1906 and 1925 at the factories in Manchester and Derby 6,173 Rolls-Royce Silver Ghosts were built. This motor car, more than any other, symbolised luxury and wealth. Like the Tsar who had chosen a Silver Ghost, Lenin, his communist successor, also chose a Rolls-Royce. The Emperor of Japan had taken delivery of two Silver Ghosts in 1922 and the aristocrats and magnates who drove Silver Ghosts were legion.
The Silver Ghost had confirmed in the eyes of the world that Rolls-Royce really did build "the Best car in the World" and when the time came for a replacement model to be found it was going to be a hard act to follow.