Austin was mainly associated with making large vehicles until WWI, however they did sell a small single-cylinder car named the Austin 7 hp from 1909 to 1910 after going back to producing larger vehicles.
In 1920, Sir Herbert Austin started working on the idea of a small production car motivated by the need for a production car aimed at younger families and the introduction of the "Horsepower Tax" that came into effect in 1921. Because his company was in receivership and the board of directors and creditors opposed the initial concept, Austin decided to work on the project himself. He began in 1921, with the help of an 18-year-old draughtsman from the Austin Factory in Longbridge, and began putting it all together from his home.
Austin finally announced the Austin 7 to the public in 1922 after the design was officially complete and after three prototypes were produced. Almost 2 500 cars were produced in the first year of production and after its complete production run in 1939, a total of 290 000 cars and vans were made, dominating the cyclecar industry and turning Austin Motor Co. into a more successful motor company.