The Birth of Electric Boat

Mindful of the Board’s criticisms of her performance, Holland decided to dry-dock Holland VI during the winter of 1898/99 for major modifications intended to eliminate the problems observed in the trials. Principal among the changes were removing the after pneumatic gun to create room for a better engine exhaust system and relocating the diving planes and rudder abaft the propeller for greater hydrodynamic efficiency. By late 1898, however, the Holland Torpedo Boat Company had virtually run out of money, largely because of its inability to complete Plunger in accordance with the government contract of 1895. Bankruptcy loomed.

At this juncture, a “benefactor” appeared in the person of Isaac L. Rice, a German-born businessman who held a de facto monopoly on the manufacture of storage batteries, such as the “chloride accumulators” that powered Holland VI and other early electric vehicles. Rice had also acquired the Electro-Dynamic Company, Frank Cable’s former employer, and after a trial ride on Holland VI the previous summer, he was enthusiastic about its promise and ready to invest. Rice proposed acquiring the John P. Holland Torpedo Boat Com-pany as the major subsidiary of a new electrical equipment combine that would amalgamate all of his earlier enterprises into a single entity to be called the “Electric Boat Company.” Accordingly, the new business was incorporated in February 1899, with Isaac Rice as president of both Electric Boat and the Holland subsidiary. Although Holland was named general manager of the latter, and Charles Morris remained superintending engineer, Elihu Frost – still secretary-treasurer – gained much of the substantive control. John Holland received some quantity of preferred stock in Electric Boat in return, but the patent rights of his various submarine inven- tions were transferred to the new company.

Financially rejuvenated and armed with additional political influence in Washington, Electric Boat’s submarine subsidiary regrouped quickly to finesse the Plunger debacle and maneuver the Navy into accepting submarines of Holland’s new design. In March 1899, Electric Boat’s congressional backers amended the June 1896 act to allow the two additional boats author- ized there to be “similar to the submarine boat Holland.” Additionally, in a far-fetched attempt to retrieve the Plunger situation, Holland and his colleagues studied replacing its steam plant with an internal combustion engine until that approach proved to be too expensive. Returning from a month-long trip to Europe in May, Holland found that the newly refurbished Holland VI was to be moved to Greenport, Long Island, a new base of operations chosen for its proximity to an operating area – Little Peconic Bay – less congested than New York Harbor. The submarine herself was towed to Greenport in mid-June, and in a new storage and maintenance complex at a nearby dockyard, company personnel prepared for the next official trial, which they hoped would clear the way for the Navy’s acquisition of Holland VI under the provisions of the 1896 authorization act, as amended.

Following additional fine-tuning of the boat during the summer and fall, the decisive Navy trial of Holland VI took place on 6 November 1899 before the Naval Board of Inspection and Survey. It was largely anticlimactic: Holland VI performed flawlessly and easily met a revised set of operating specifications promulgated by the Naval Strategy Board the year before.9 Within two weeks, Elihu Frost offered the new boat to the Navy for $165,000 while work on Plunger continued. When Navy authorities argued that buying any submarine under the 1896 appropriation required first accepting Plunger, Frost, Rice, and Holland applied additional pressure by transferring Holland VI to the Washington Navy Yard, via the inland waterway, the Chesapeake Bay, and the U.S. Naval Academy at Annapolis, all the while furiously lobbying the Congress for support.

On 14 March of the new year, Holland VI’s capabilities were demonstrated on the Potomac River to the Navy’s General Board under Admiral George Dewey – the hero of Manila Bay – plus a large audience of Navy civilian officials, senators, and representatives. After Dewey testified to Congress a week later that “if [the Spanish] had had two of those things in Manila, I never could have held it with the squadron I had…,” virtually all opposition vanished. Subsequently on 11 April 1900, the date now celebrated as the birthday of the U.S. Submarine Force, the Navy bought Holland VI from the Holland Torpedo Boat Company for $150,000. By early June, follow-on congressional hearings on submarine roles and missions, at which John Holland himself appeared as a witness, had led directly to the passage of another appropriation act that provided for the purchase of five more boats. Thus, in late August, the Navy contracted with the submarine subsidiary of the Electric Boat Company for six new submarines of the “improved Holland type,” each to cost no more than $170,000. Additionally, in October, after the government agreed to cancel the Plunger contract in exchange for Electric Boat’s returning all progress payments made to date, the Navy ordered an additional boat, for a total of eight, including Holland VI.10

Growing Disappointment at Electric Boat

With the Navy’s agreement to buy not only Holland VI but also seven additional submarines in 1900, John Holland, then approaching 60, had finally achieved the goal toward which he had worked for two decades. Sadly, however, this gratifying personal success was marred by increasing frustration with his role in the Electric Boat Company. During Holland’s European trip a year earlier, Elihu Frost had quietly taken steps to undermine the inventor’s claim to the foreign rights of his own submarine patents and later that summer replaced him with Frank Cable as the trials captain of the new boat, ostensibly because he was too valuable to lose in an accident. Also, there were clear signs that his technical authority was diminishing among his colleagues and that Frost and Rice had become impatient with his constant design modifications. In October 1899, when personal loyalty to Holland made his position untenable, Charles Morris resigned from Electric Boat, and in June 1900, Holland himself was demoted from general manager to “chief engineer.”

Meanwhile, Frank Cable had been training a Navy crew under LT Harry H. Caldwell, formerly ADM Dewey’s personal aide, to assume operation of Holland VI. Their preparation completed, Caldwell and his crew created a furor by unexpectedly “sinking” the battleship USS Kearsarge (BB-5) during a North Atlantic Squadron war game off Newport in September, and on 12 October 1900, the Navy’s first submarine was officially commissioned as USS Holland (later SS-1) with Caldwell in command.

In preparation for building the seven “improved Holland-type” submarines contracted for in 1900, Electric Boat embarked on constructing a prototype – named Fulton – at the same Crescent Shipyard in Elizabethport where Holland VI had been built. Holland essentially designed both Fulton and the subsequent Adder class, but almost immediately his authority was challenged during Fulton’s construction by Naval Constructor Lawrence Y. Spear, assigned by the government to oversee the work. Although Spear was a qualified naval architect, having attended first the Naval Academy and then the University of Glasgow, he had had no experience in submarines prior to this new responsibility. He and Holland soon clashed over design details and material specifications, and when a year later, Spear was hired away from the Navy to become Electric Boat’s chief naval architect and vice president – and thus John Holland’s boss – Holland must have been angrily disillusioned. In any event, Fulton was completed in the summer of 1901 and after successfully validating the Adder design, was laid up until early 1903, when she was upgraded to compete against Simon Lake’s Protector, which Lake had built in an attempt to wrest the Navy’s submarine business away from Electric Boat.11