This is the period of the first breakthrough for Penta as a product name. At the start of the 1920s the general depression forced the company to keep business at a very low level. Two events would change this.

In 1922 the U2 outboard engine was introduced and 343 units were sold in the very first year. During the whole of the 1920s, no less than 7,874 U-2s were sold - more than the rest of the product range put together. 1925 - Penta received its first order from AB Volvo, a newly established car manufacturer in Goteborg. Two years later, the first Volvo cars were running, powered by Penta.