Watson was a driver in the Vauxhall racing team from 1912 to 1914, which had mixed success.
A fellow driver was Harry Ferguson, who would become a famous tractor manufacturer.
In 1901 he founded W Watson & Co, cycle and motor car manufacturers, and acquired additional premises in Vine Street, Liverpool.
In 1901 he set up a Chester-to-Farndon public hire service, after successfully applying for a Hackney Carriage licence for a motor vehicle, the first in Chester and one of the earliest in the country.
In the 1912 French Grand Prix/Coupe de l'Auto race at Dieppe on 25 June, Watson's A-type Vauxhall, in the 3-litre class, was forced to retire in the second lap with a broken gudgeon pin.
He then imported De Dion-Bouton petrol engines to make powered tricycles, and by 1900 was producing and selling the two-seater "W & D Quad".The event, for more than a hundred cars, covered over 1000 miles and took a week of timetabled driving, accompanied by a different observer every day, with a daily hill climb.He came second on the 40 hp Berliet in the 1907 Graphic Trophy Race on the Isle of Man.Watson entered the 1906 Graphic Trophy Race, Isle of Man, and came third on a 40 hp Berliet.He entered the 1907 Scottish Reliability Trial, winning a gold medal on the 40 hp Berliet, averaging 22 mpg fuel consumption.Mechanical failure again caused Watson to retire, this time with a broken crankshaft, on the first lap of the Isle of Man Tourist Trophy in 1914.It was his third and final appearance in that event.A champion cyclist as a young man, he founded W Watson & Co, cycle and motorcar manufacturer, in 1901.He won the epic 1908 Isle of Man Tourist Trophy Race driving a Hutton-Napier named Little Dorrit. He expanded Watson & Co from Liverpool to Chester, Colwyn Bay, London, Birkenhead and Crewe, creating the largest car distributing organisation in the North of England, specialising in Morris and Rolls-Royce cars.Before the event there had been an outcry that motor racing on public roads was too dangerous but the event took place without serious casualties.His 5.8-litre Hutton, race number '2’, started in pole position.