History doesn’t repeat, but it does rhyme.

Curtiss-Wright was a huge airframe, engine and propeller manufacturer. that made a PILE of money from WW II. After the war, they had about a hundred million dollars in cash in the bank that they didn’t know what to do with.

The engineering management of the company was replaced by financial people. The financial people were not interested in making or building anything with the money and all they wanted to do with the money was a) buy back stock b) Issue dividends and c) buy other companies.

CW had one product, the R-3350 radial engine, that generated a lot of money. The R-3350 came into its own in the early 1940s when it was chosen as the power plant for a number of military aircraft. Then it became the engine of choice for the last-generation of piston airliners.

CW believed that the R-3350 would have a semi-permanent market. CW ceased developing their own gas turbines, opting to milk every last drop of profit. They charged the airlines outrageously high prices for parts for the R-3350, which permanently damaged CW’s reputation.

I think that the press is now putting a little too much emphasis on the effect of the cultural takeover of Boeing by McDonnell Douglas. While it was certainly a factor, what history tells us is that the financialization of mature industries is nothing new nor unique to Boeing.

The forces that destroyed CW also destroyed Douglas and are now destroying Boeing. McDonnell Douglas did not destroy Boeing. What destroyed Boeing was the same thing that destroyed CW AND Douglas: Old white men of limited intellect, limited vision and unlimited greed.

“[He] proudly announced that he had cut engineering expenses in half, by significantly reducing size of engineering staff. Company manufacturing had been carried on by men who were engineers, not businessmen. ‘They are not profit and loss conscious'”.

Field (investment company) said of Curtiss-Wright: “[their] exceptionally strong cash position is both a strength and weakness. Management becomes a target of pleas for distribution of funds to stockholders and subject to pressure for the purchase of other enterprises”

Final note: in 1950 60% of Curtiss-Wright’s sales came from the 1930s-era R-3350 piston engine, which was a cash cow. However the era of piston engineered airliners was rapidly closing while CW adamantly refused to invest in new power plant technologies (jets, turboprops).

 

– Gregory Travis is a software architect, aircraft owner and writer. His first article identifying the issues with the 737 Max appeared in the May 2019 issue of IEEE Spectrum magazine.