In 1932, the engineers at Lycoming Engines became aware that the United States Army Air Corps (USAAC) wanted a high performance engine that could produce at least one horsepower per cubic inch (46 kW/L) of engine displacement and that a contract had been made with Continental Motors, Inc., Lycoming's main rival in the general aviation engine market.[1] Lycoming's management wanted to be considered for development of the next generation engine, but no USAAC development contract was signed. Still determined to become known as a high performance engine manufacturer, Lycoming began an experimental, high-performance engine of its own. After spending US$500,000, and after many attempts to develop a successful engine, it finally came close to the USAAC specifications with the 1,200 hp (895 kW) O-1230 engine.
Lycoming's O-1230 engine design was a 12-cylinder liquid-cooled horizontally-opposed low-profile piston engine that could be mounted either horizontally, buried in the wing of a multi-engine aircraft; or vertically, in the fuselage of a single engine fighter. From 1935 the engine design proceeded at a faster pace after a number of former Continental engineers, who had become unhappy with the working conditions there, joined Lycoming.[2] The same year the USAAC became interested in the O-1230, and began supporting the engine development program. In 1936, the single-cylinder development tests exceeded expectations, passing its 50-hour test requirement. The full-size engine was ready for testing in 1937, and was rated at 1,000 hp.
The last Vultee A-19 that had been ordered by the USAAC was delivered as the XA-19A, fitted with an O-1230-1 offering 1200 hp. It first flew on May 22, 1940. This aircraft was subsequently re-engined with a Pratt & Whitney R-1830-51 and redesignated.
Continued development of the O-1230 reached its peak when the engine was rated at over 1200 hp. It was as powerful as the Allison V-1710, but with a narrower cowling than the Allison V12 engine. The O-1230 was not well received by aircraft manufacturers, because it was not very reliable at that power setting.[2]