Curtiss-Wright Corporation

1200 Wall St. W.
Lyndhurst, New Jersey 07071
U.S.A.
(201) 896-8400
Fax: (201) 438-5680

Public Company
Incorporated: 1929
Employees: 1,550
Sales: $158.9 million
Stock Exchanges: New York
SICs: 3593 Fluid Power Cylinders & Actuators; 3398 Metal Heat Treating; 3492 Fluid Power Valves & Hose Fittings; 3356 Nonferrous Rolling & Drawing Nee.

Curtiss-Wright Corporation is a diversified multinational manufacturing company, which produces and markets precision components and systems and provides highly engineered services to the aerospace, industrial, and flow control and marine markets. All of the company’s core products and services, provided by four wholly owned subsidiaries, involve precision working of metals and alloys.

Curtiss-Wright Corporation was formed in 1929 as a holding company for a variety of aviation concerns, when the Curtiss Aeroplane and Motor Corporation and Wright Aeronautical Corporation merged, bringing together 18 affiliated companies and 29 subsidiaries. Bankers had tried for years to bring together the two rival companies, started by aviation pioneers and inventors Orville and Wilbur Wright and Glenn H. Curtiss, and the merger finally put an end to two decades of patent battles between the Wright brothers and Curtiss. Hailed upon its formation by Wall Street financiers as the world’s most prodigious aviation concern, the company debuted with total assets of more than $70 million and stock valued at $220 million as it entered an industry battle with the recently created United Aircraft and Transportation Company.

While its namesakes had little to do with the creation of the new firm, Glenn Curtiss did serve as a member of the company’s technical committee prior to his death in 1930, the year the Curtiss Condor—a civilian version of a two-engine bomber plane—was being introduced by some airlines. The Curtiss-Wright Corporation maintained a position of preeminence in aeronautics throughout the 1930s, although the aviation industry remained relatively small and the firm’s sales had reached only $49 million by 1939.

In 1940, the company created the Curtiss Propeller Division, a forerunner of the subsidiary Curtiss-Wright Flight Systems, Inc. Serving as a core source of government work after the United States entered World War II, Curtiss Propeller Division became one of the single largest defense contractors in the world. During the war, the company employed 180,000 workers and produced 146,000 aircraft propellers, 143,000 airplane engines, and more than 26,000 planes as Curtiss-Wright became the second largest manufacturer in the United States with annual sales surpassing $1 billion two years running. Curtiss-Wright engines powered the majority of American planes flown in World War II, including the B-29 that dropped the first atomic bomb on Japan and precipitated the close of the global conflict.

After the war, Curtiss-Wright was forced to deal with a rapid decline in military contracts, and enormous operational cutbacks were made as the company began converting military aircraft engines for use in commercial airliners. In 1949, Guy Vaughan, who had long directed the company’s operations, was ousted in a management shake-up and replaced by Roy T. Hurley, who became president and chairperson. Hurley brought a reputation as a production cost-cutter to Curtiss-Wright, having served as a vice-president of production at Bendix Aviation Corporation and a director of manufacturing at Ford Motor Company.

With the United States’ involvement in the Korean War during the early 1950s the company again benefitted from a new round of government contracts for aircraft engines. As a result, Curtiss-Wright remained among the top ten U.S. defense contractors during the first half of the decade, producing ram-jet engines for guided missiles, aircraft engines and propellers, and flight simulators for the military.

During this time, Hurley initiated a massive diversification drive, beginning in 1951 when Curtiss-Wright acquired a plant in Buffalo, New York, where it began a specialized metal extrusion business. The company also purchased another plant in Carlstadt, New Jersey, to serve as foundation for a new electronics division. During the mid-1950s Curtiss-Wright entered the Canadian market with the creation of the subsidiary Curtiss-Wright of Canada Ltd. (later renamed Canadian Curtiss-Wright). The company also established a scientific products and research division and began construction of a research and development center at Quehanna, Pennsylvania, where it established a nuclear materials laboratory to support defense and peacetime applications of atomic energy.

By the end of 1955, Hurley’s diversification drive had helped propel Curtiss-Wright’s annual sales from $475 million a year to more than $500 million, with commercial sales generating about 40 percent of the company’s income. By 1956, Curtiss-Wright had 16 divisions, and the company’s stock had risen to a high of 49/1

Curtiss-Wright utilized acquisitions and joint developments with other companies to bolster its engine business, acquiring Propulsion Research Corporation and Turbomotor Associates. The company began developing engines in the low-to-medium-range power categories for aircraft, helicopters, and missiles.

Curtiss-Wright also teamed up with Bristol Aeroplane Company to develop a series of commercial engines. The company’s military engine production continued to consist largely of the J-65, initially licensed from Great Britain, while its principal commercial product was the 3350 Turbo Compound piston engine, used in the fastest commercial propeller airliners of the day.

In 1956, Curtiss-Wright agreed to loan $35 million to financially troubled Studebaker-Packard and provide management services for the automaker. In return, Studebaker-Packard sold Curtiss-Wright its subsidiary, Aerophysics Development Corporation, and leased the aviation concern its facilities in Utica, Michigan, and South Bend, Indiana, where Curtiss-Wright began producing the army’s new Dart anti-tank missile, which Aerophysics Development had helped develop.

The following year, Studebaker-Packard received the rights to manufacture the Daimler-Benz engine from Germany’s Mercedes-Benz in exchange for allowing the German automaker to produce a Curtiss-Wright plane. After two years of managing Studebaker-Packard, Curtiss-Wright terminated its management contract with the automaker and acquired the South Bend and Utica plants it had been leasing as well as the rights to manufacture and sell Daimler-Benz’s diesel and multi-fuel engines, fuel injection systems, military vehicles, and buses.

By 1957, about two-thirds of Curtiss-Wright’s sales were from government contracts, while about two-thirds of its profits stemmed from nonmilitary sales. Seeking to widen its commercial activities and steer clear of government contracts, the company focused on the development of ultrasonic equipment, new products for its Buffalo extrusion business, and new uses for its plastic material, Curon, which had applications as apparel lining, wall and floor coverings, soundproofing, upholstery, auto trim, and cushions.

In 1958, Curtiss-Wright began operating a nuclear research reactor at its Quehanna facility. The company also established a solar research laboratory in conjunction with New York University, resulting in an agreement with Hupp Corporation to jointly explore, develop, and sell devices in the solar energy field, including heat storage and cooking devices. In 1959, Curtiss-Wright also began producing industrial x-ray inspection equipment, which was added to the firm’s lines of quality control equipment, inspection equipment, and measurement systems using ultrasonic, radiographic, and nuclear energy technologies. During this time, Curtiss-Wright entered the earth-moving business with the acquisition of a Continental Copper & Steel Industries division that manufactured such equipment.

Curtiss-Wright’s experimental developments included a coal-based blacktop road paving material and an “air car” that could travel six to 12 inches above ground, as well as a lightweight internal combustion engine with only two main moving parts. The rotary engine, which became known as the Wankel, was designed to burn gasoline in such a way as to turn a triangular shaped rotor, rather than driving pistons up and down like conventional piston engines. Developed in conjunction with NSU Werke of West Germany, the engine—for which Curtiss-Wright attained exclusive world rights for aircraft uses and exclusive North American rights for all applications—stemmed from an invention by the German firm’s Felix Wankel.

A series of defense cutbacks during the late 1950s hurt Curtiss-Wright’s ramjet development business, and the company’s earnings began to decline, falling from $25 million in 1958 to $14.3 million in 1959 as sales dropped from $388 to $329 million. In April 1960 Hurley was confronted by a hostile crowd at the firm’s annual meeting and faced criticism over falling earnings, reduced dividends, high officer compensation, and insufficient information regarding the company’s experimental developments. Hurley resigned as president and chairperson one month later and was replaced by one of his more vocal critics, T. Roland Berner. An attorney who had become a director at Curtiss-Wright after leading a nearly successful proxy battle against management in 1948, Berner had been instrumental in the 1949 shake-up that initially brought Hurley to power.

Berner quickly divested Curtiss-Wright of several divisions. The company donated its nuclear reactor to Pennsylvania State University and sold its South Bend and Utica facilities, Curon plastics business, West Coast research facilities, and its process for producing paving material from coal. Furthermore, the company’s plant in Lawrence, New Jersey, which had been making ultrasonics as well as quality control and testing equipment, was closed, plans for commercial production of the air car were dropped, and operations at Quehanna ceased.

Seeking to return Curtiss-Wright to the status of a leading aircraft engine manufacturer, Berner shifted the firm’s emphasis to defense and electronics products. During the early 1960s, Curtiss-Wright landed Air Force contracts for propellers, missile parts, and the modernization of the J-65 engine and began producing steel rocket casings for solid-fuel boosters for Titan III space launch vehicles. During the same period, Curtiss-Wright’s electronics business was expanded through the acquisition of companies engaged in the manufacture of radar cameras and automatic timing controls for aircraft and missiles, as well as the manufacture of printed circuit board connectors for aircraft, missile, and computer applications.

Curtiss-Wright also expanded its activities in nuclear fields with the acquisition of an interest—and eventual complete control of—Target Rock Corporation, a manufacturer of hydraulic components and nuclear equipment. Curtiss-Wright also broadened its Canadian operations with the acquisition of companies engaged in the production of hydraulic equipment for oil companies and steel products for the building and mining industries.

In 1962, the company received a Federal Aviation Agency (FAA) contract to study compressor, turbine, and computer technologies for supersonic transport jet engines and began competing for a major government contract to develop and produce a supersonic commercial airliner engine. During the mid-1960s, the company sold its electronic fittings and components division at a time when it was plowing about $15 million of its own funds into the development of a supersonic transport plane engine.

Curtiss-Wright lost its bid to produce the supersonic engine, and, by 1967, the company had abandoned Berner’s goal to build complete aircraft engines, opting to become a first-tier supplier, or subcontractor, for other companies involved in aerospace and other fields. By that time, when Curtiss-Wright landed a Boeing contract to provide flight actuators to extend and retract flaps on the wings of the giant Boeing 747 jet airliner, its “power hinge” mechanics were already in use on a North American Aviation supersonic research plane, a General Dynamic’s fighter bomber, and a Boeing helicopter. Curtiss-Wright’s relations with governmental and commercial customers continued to improve, and, by the late 1960s, Curtiss-Wright was supplying components for Lockheed’s air bus and military transport plane and had become for many aerospace firms a preferred supplier of components for jet engines, helicopters and aircraft, as well a supplier of nuclear equipment and high precision products for firms in nonaerospace industrial fields.

In 1968, Curtiss-Wright began an expansion program at its Buffalo extrusion facility, adding new forging and machining equipment for building aircraft and aerospace components. That year, the company acquired Metal Improvement Company, Inc. (MIC), an industry leader in shot peening technology used to create aerodynamic curvatures in aircraft and other products. The company’s operations were also expanded through acquisitions of domestic companies involved in the production of aircraft wing ribs and airframe parts and a Canadian manufacturer of metal-working equipment and supplies for the steel processing industry. In 1969, Curtiss-Wright acquired a majority interest in Dorr-Oliver Inc., a engineering firm that made mechanized equipment for airline cargo terminals; Curtiss-Wright eventually acquired complete control of Dorr-Oliver.

Curtiss-Wright entered the 1970s as a producer of components or systems for all new wide-bodied commercial jet airliners and most jet planes, at a time when cutbacks in defense and military spending resulted in fewer government contracts. When automakers and other firms began showing a growing interest in the Wankel rotary engine, Curtiss-Wright began extending licensing agreements for the engine. In 1970, General Motors Corporation paid $50 million to acquire a five-year nonexclusive license to develop and manufacture the rotary combustion engine in North America. Subsequent license agreements called for royalty payments to Curtiss-Wright for all sales of Wankel engines in addition to a licensing fee. Speculation on the potential for the development of the smaller, lighter, and more powerful Wankel intensified. By 1972, Wankel had become one of the hottest names on Wall Street, and Curtiss-Wright’s stock was one of the most volatile and actively traded.

In 1972, Curtiss-Wright granted Wankel development licenses to Brunswick Corporation, a manufacturer of the Mercury line of outboard motors, and Ingersoll-Rand Company, for use in that firm’s compressor, pump, and electric generator assemblies. The following year, American Motors Corporation became Curtiss-Wright’s seventh Wankel licensee, about the same time that GM announced it would introduce the rotary engine in its 1975 Vega model. However, GM soon renegotiated its payment agreement with Curtiss-Wright after indefinitely postponing the debut of the Wankel in its vehicles, citing emissions and gas mileage difficulties as motivating factors.

As interest in the Wankel declined, due to hydrocarbon emissions concerns, Curtiss-Wright began acquiring the stock of Cenco Inc., a maker of pollution-control equipment and medical supplies and an operator of nursing homes and hospitals. By July 1975, Curtiss-Wright had acquired 16 percent of Cenco’s stock. Upon learning that Cenco was entangled in allegations of fraudulent auditors reports and was on the verge of bankruptcy, Curtiss-Wright took control of the firm and placed Shirley D. Brinsfield, president of Dorr-Oliver, as Cenco chairperson. During this time, Teledyne Inc., a diversified firm with interests in electronic and aviation control systems and insurance, began acquiring Curtiss-Wright stock, and, by mid-1976, it held a 12-percent stake.

During this time, Curtiss-Wright was producing a wide range of military nuclear components, nuclear handling equipment, and nuclear systems devices, including special valves and regulators and seal weld fitting machines. The company also began actively developing turbine-powered generators, which were sold both domestically and internationally.

In 1978, Berner launched a proxy challenge to gain control of Kennecott Corporation, the nation’s largest copper company. Having already acquired a 9.9 percent interest in the mining concern, Berner charged that Kennecott had wasted assets in its $567 million acquisition of the Carborundum Company, and he proposed a dissident slate of directors committed to selling Carborundum and distributing the proceeds among shareholders, including Curtiss-Wright. Kennecott’s directors narrowly won the election, but a federal judge ordered a second vote. To stave off a rerun election, Kennecott convinced Thomas D. Barrow, an Exxon Corporation senior executive, to take control of the copper company, and within two weeks Barrow and Berner had agreed to a new Kennecott board, which would serve through the spring of 1981 and would give Berner’s faction a voice in the mining firm’s affairs.

Over the next two years, Curtiss-Wright boosted to more than 22 percent its stake in Lynch Corporation, a manufacturer of glass-forming machinery and flow instruments that Curtiss-Wright had controlled for about 15 years. Curtiss-Wright also entered the heat treating market in 1980 with the acquisition of Diebel Heat Treating Company, serving the automotive, oil exploration, and agricultural equipment markets.

By November 1980, Curtiss-Wright had increased its stake in Kennecott to 14.3 percent, and its truce with the company was about to expire. Consequently, the copper company made a bid to acquire Curtiss-Wright, setting off a second round of corporate warfare. Curtiss-Wright responded to the Kennecott threat by initiating a buyback of its own stock to block takeover attempts, spurring a Kennecott offer to buy up Curtiss-Wright’s outstanding stock. As a result, Kennecott acquired nearly 32 percent of Curtiss-Wright and surpassed Teledyne as the largest Curtiss-Wright stockholder, though falling short of its objective for majority control. In January 1981, Kennecott and Curtiss-Wright signed a ten-year truce agreement, and Curtiss-Wright sold Kennecott its Dorr-Oliver subsidiary and its shares of Kennecott stock; in return, Kennecott gave Curtiss-Wright $168 million and the shares of Curtiss-Wright it held which, along with stock tendered in Curtiss-Wright’s self-buyback, helped give Teledyne more than 50 percent control of Curtiss-Wright.

Curtiss-Wright’s sale of Cenco—resulting in $9.8 million in earnings—along with a $52 million gain from the sale of Dorr-Oliver and Kennecott shares helped push Curtiss-Wright’s 1981 earnings to $85 million. Next, the company began investing in Western Union Corporation, acquiring a 21.6 percent stake in the telecommunications concern. However, this investment proved unsuccessful; Curtiss-Wright lost $42 million on the company, and as its 1984 total earnings plunged to $1.9 million—down from $18.5 million a year earlier—the company sold its stake in Western Union. Also during this time, Curtiss-Wright abandoned its hopes for the Wankel, selling its rotary combustion engine business to Deere & Company after failing to discover a commercial application for the engines.

In 1986, Curtiss-Wright received an Air Force contract in excess of $40 million to provide wing-flap actuators for the F-16, leading to ongoing F-16 actuator business. The following year, Curtiss-Wright was forced to fire several Target Rock senior executives after discovering an embezzlement scheme that resulted in the indictment of several former employees and suppliers. Considered a victim of the embezzlements, Curtiss-Wright was not charged with criminal misconduct in the matter, although in 1990 the government initiated litigation against Target Rock Corporation related to embezzlements by former Target Rock officials and their alleged mischarging of government subcontractors.

In March 1990, Berner died and was succeeded by Shirley D. Brinsfield, an outside director and former chairperson of Cenco who pledged to focus Curtiss-Wright’s operations on manufacturing rather than investments. Charles E. Ehinger was elected president and Berner’s son, Thomas R. Berner, was elected to the company’s board. Less than four months after Berner’s death, Curtiss-Wright declared a special dividend of $30 a share. The primary beneficiaries were Unitrin Inc., an insurance company once owned by Teledyne with a 44 percent interest in Curtiss-Wright, and Argonaut Group (formerly owned by Tele-dyne) with an eight percent interest.

During the late 1980s, Curtiss-Wright’s sales and income remained fairly stable, fluctuating between $21 million and $28 million in earnings and $188 million and $212 million in sales. In 1990, the company’s revenues climbed to $214 million while earnings sunk to $6.8 million, largely due to a $13.8 million after-tax environmental charge related to soil and ground water contamination at the company’s former Wood-Ridge facility. Over the next two years, however, earnings rebounded to more than $21 million. In July 1991, Ehinger resigned as president and Brinsfield assumed the duties of president. Curtiss-Wright sold the engine distribution business of its Canadian subsidiary and discontinued its remaining Canadian operations soon thereafter.

In early 1993, Curtiss-Wright announced that it would explore the sale of three of its four business units, including Metal Improvement Company, its Flight Systems Group, and its Buffalo Extrusion Facility. In May 1993, Curtiss-Wright’s presidency was turned over to David Lasky, a former senior vice-president, and, two months later, Curtiss-Wright abandoned attempts to sell its Flight Systems subsidiaries, as offers did not meet expectations. By October of that year, Curtiss-Wright had reached an agreement to sell its extrusion business, while depressed conditions in the commercial and military aerospace markets led the firm to abandon the sale of MIC, which had garnered less than favorable offers.

At the end of the year, Curtiss Wright’s Target Rock subsidiary agreed to pay the government $17.5 million to settle remaining litigation. The Target Rock settlement, coupled with environmental clean-up charges, contributed to an annual loss of $5.6 million on declining sales of $158.9 million in 1993.

Curtiss-Wright entered 1994 seeking expanded commercial markets in the area of pollution control, for which its electronic control valves were well suited. The company faced cutbacks in the production of commercial aircraft, a reduction in pricing levels and U.S. Air Force procurement of the Lockheed F-16 fighter plane, the recent termination of valve orders for the U.S. Navy’s Seawolf program, and reduced production activity in the Navy’s nuclear program. The future of Curtiss-Wright, which abandoned the sale of its subsidiaries in 1993 in favor of optimum shareholder value, appeared contingent on both the economics of the company’s traditional markets and the company’s success in broaching new markets. The company’s future also seemed dependent on its ability and desire to maintain its business units under the Curtiss-Wright name in an era of increasing consolidation and cutbacks in the defense and aerospace industries.

Principal Subsidiaries:

Curtiss-Wright Flight Systems, Inc.; Curtiss-Wright Flight Systems/Shelby, Inc.; Target Rock Corporation; Metal Improvement Company, Inc.

Further Reading:

Carley, William M., and Tim Metz, “Proxy Pugilism: Curtiss-Wright’s Bid for Kennecott Has David-Goliath Aspects,” The Wall Street Journal, April 18, 1978, pp. 1, 39.

“Curtiss-Wright Engine Has Only 2 Moving Parts,” The Wall Street Journal, November 24, 1959, p. 4.

“Curtiss-Wright Sees Its Earnings Growth Continuing this Year,” The Wall Street Journal, February 18, 1969, p. 8.

“Curtiss-Wright, Studebaker-Packard Paths Marked by Mergers in Plane, Auto Fields,” The Wall Street Journal, August 6, 1956, p. 4.

“Facing Reality,” Forbes, November 15, 1967, pp. 24-25.

“Hurley Gives Up Curtiss-Wright Posts; Berner, a Director, Is Named Chairman,” The Wall Street Journal, May 26, 1960, p. 9.

“Kennecott and Curtiss-Wright End Corporate Battle by Agreeing to 10-Year Truce Involving $280 Million,” The Wall Street Journal, January 29, 1981, p. 3.

Martin, Richard, “Wondrous Wankel: Engine Not Only Drives Vehicles, but It Also Puts Stocks Into Orbit,” The Wall Street Journal, June 16, 1972, pp. 1, 25.

Shao, Maria, “Kennecott’s Battle With Curtiss-Wright Involves Ambitions, Strategies and Money, The Wall Street Journal, January 5, 1981, p. 19.

Stevens, Charles W., “Curtiss-Wright Picks Top Officers After Berner Death,” The Wall Street Journal, March 23, 1990, p. C18.

Tannenbaum, Jeffrey A., “Curtiss-Wright Slates Payout of $30 a Share,” The Wall Street Journal, July 13, 1990, p. C9.

“The Well-Deserved Decline of Curtiss-Wright,” Forbes, November 15, 1967, pp. 24-26.

—Roger W. Rouland

Curtiss-Wright Corporation

1200 Wall Street West
Lyndhurst, New Jersey 07071
U.S.A.
Telephone: (201) 896-8400
Fax: (201) 438-5680
Web site: http://www.curtisswright.com

Public Company
Incorporated: 1929
Employees: 2,300
Sales: $293.26 million (1999)
Stock Exchanges: New York
Ticker Symbol: CW
NAIC: 333995 Fluid Power Cylinder and Actuator Manufacturing; 332811 Metal Heat Treating; 332912 Fluid Power Valve and Hose Fitting Manufacturing; 331491 Nonferrous Metal (Except Copper and Aluminum) Rolling, Drawing, and Extruding

The Curtiss-Wright Corporation (CWC), built on two of the most esteemed names in American aviation history, has evolved from an aircraft manufacturer to a highly diversified conglomerate to a focused engineering firm. Through its Motion Control segment, CWC literally opens doors (and drops flaps) for commercial and military aircraft makers. Metal Treatment makes aircraft wings stronger, and Flow Control produces valves for nuclear submarines and power plants. The company also makes a tool for freeing accident victims from automobile wreckage, and it has made a number of acquisitions to expand its markets and acquire related technologies.

Lofty Origins

Curtiss-Wright Corporation (CWC) was formed in 1929 as a publicly listed holding company for a variety of aviation concerns, when the Curtiss Aeroplane and Motor Corporation and Wright Aeronautical Corporation merged, bringing together 18 affiliated companies and 29 subsidiaries. Bankers had tried for years to bring together the two rival companies, started by aviation pioneers and inventors Orville and Wilbur Wright and Glenn H. Curtiss, and the merger finally put an end to two decades of patent battles between the Wright brothers and Curtiss. Hailed upon its formation by Wall Street financiers as the world’s most prodigious aviation concern, the company debuted with total assets of more than $70 million and stock valued at $220 million as it entered an industry battle with the recently created United Aircraft and Transportation Company.

Although its namesakes had little to do with the creation of the new firm, Glenn Curtiss did serve as a member of the company’s technical committee prior to his death in 1930, the year the Curtiss Condor—a civilian version of a two-engine bomber plane—was being introduced by some airlines. The Curtiss-Wright Corporation maintained a position of preeminence in aeronautics throughout the 1930s, although the aviation industry remained relatively small and the firm’s sales had reached only $49 million by 1939.

In 1940, the company created the Curtiss Propeller Division, a forerunner of the subsidiary Curtiss-Wright Flight Systems, Inc. Serving as a core source of government work after the United States entered World War II, Curtiss Propeller Division became one of the single largest defense contractors in the world. During the war, the company employed 180,000 workers and produced 146,000 aircraft propellers, 143,000 airplane engines, and more than 26,000 planes as Curtiss-Wright became the second largest manufacturer in the United States with annual sales surpassing $1 billion two years running. Curtiss-Wright engines powered the majority of American planes flown in World War II, including the B-29 that dropped the first atomic bomb on Japan and precipitated the close of the global conflict.

Postwar Diversification

After the war, Curtiss-Wright was forced to deal with a rapid decline in military contracts, and enormous operational cutbacks were made as the company began converting military aircraft engines for use in commercial airliners. In 1949, Guy Vaughan, who had long directed the company’s operations, was ousted in a management shake-up and replaced by Roy T. Hurley, who became president and chairperson. Hurley brought a reputation as a production cost-cutter to Curtiss-Wright, having served as a vice-president of production at Bendix Aviation Corporation and a director of manufacturing at Ford Motor Company.

With the United States’ involvement in the Korean War during the early 1950s the company again benefited from a new round of government contracts for aircraft engines. As a result, Curtiss-Wright remained among the top ten U.S. defense contractors during the first half of the decade, producing ram-jet engines for guided missiles, aircraft engines and propellers, and flight simulators for the military.

During this time, Hurley initiated a massive diversification drive, beginning in 1951 when Curtiss-Wright acquired a plant in Buffalo, New York, where it began a specialized metal extrusion business. The company also purchased another plant in Carlstadt, New Jersey, to serve as foundation for a new electronics division. During the mid-1950s Curtiss-Wright entered the Canadian market with the creation of the subsidiary Curtiss-Wright of Canada Ltd. (later renamed Canadian Curtiss-Wright). The company also established a scientific products and research division and began construction of a research and development center at Quehanna, Pennsylvania, where it established a nuclear materials laboratory to support defense and peacetime applications of atomic energy.

By the end of 1955, Hurley’s diversification drive had helped propel Curtiss-Wright’s annual sales from $475 million a year to more than $500 million, with commercial sales generating about 40 percent of the company’s income. By 1956, Curtiss-Wright had 16 divisions, and the company’s stock had risen to a high of 49⅜.

Curtiss-Wright utilized acquisitions and joint developments with other companies to bolster its engine business, acquiring Propulsion Research Corporation and Turbomotor Associates. The company began developing engines in the low- to mediumrange power categories for aircraft, helicopters, and missiles. Curtiss-Wright also teamed up with Bristol Aeroplane Company to develop a series of commercial engines. The company’s military engine production continued to consist primarily of the J-65, initially licensed from Great Britain, and its principal commercial product was the 3350 Turbo Compound piston engine, used in the fastest commercial propeller airliners of the day.

In 1956, Curtiss-Wright agreed to loan $35 million to financially troubled Studebaker-Packard and provide management services for the automaker. In return, Studebaker-Packard sold Curtiss-Wright its subsidiary, Aerophysics Development Corporation, and leased the aviation concern its facilities in Utica, Michigan, and South Bend, Indiana, where Curtiss-Wright began producing the army’s new Dart anti-tank missile, which Aerophysics Development had helped to develop.

The following year, Studebaker-Packard received the rights to manufacture the Daimler-Benz engine from Germany’s Mercedes-Benz in exchange for allowing the German automaker to produce a Curtiss-Wright plane. After two years of managing Studebaker-Packard, Curtiss-Wright terminated its management contract with the automaker and acquired the South Bend and Utica plants it had been leasing as well as the rights to manufacture and sell Daimler-Benz’s diesel and multifuel engines, fuel injection systems, military vehicles, and buses.

By 1957, about two-thirds of Curtiss-Wright’s sales were from government contracts and about two-thirds of its profits stemmed from nonmilitary sales. Seeking to widen its commercial activities and steer clear of government contracts, the company focused on the development of ultrasonic equipment, new products for its Buffalo extrusion business, and new uses for its plastic material, Curon, which had applications as apparel lining, wall and floor coverings, soundproofing, upholstery, auto trim, and cushions.

In 1958, Curtiss-Wright began operating a nuclear research reactor at its Quehanna facility. The company also established a solar research laboratory in conjunction with New York University, resulting in an agreement with Hupp Corporation to jointly explore, develop, and sell devices in the solar energy field, including heat storage and cooking devices. In 1959, CurtissWright also began producing industrial x-ray inspection equipment, which was added to the firm’s lines of quality control equipment, inspection equipment, and measurement systems using ultrasonic, radiographic, and nuclear energy technologies. During this time, Curtiss-Wright entered the earth-moving business with the acquisition of a Continental Copper & Steel Industries division that manufactured such equipment.

Curtiss-Wright’s experimental developments included a coal-based blacktop road paving material and an “air car” that could travel six to 12 inches above ground, as well as a lightweight internal combustion engine with only two main moving parts. The rotary engine, which became known as the Wankel, was designed to burn gasoline in such a way as to turn a triangular shaped rotor, rather than driving pistons up and down like conventional piston engines. Developed in conjunction with NSU Werke of West Germany, the engine—for which Curtiss-Wright attained exclusive world rights for aircraft uses and exclusive North American rights for all applications—stemmed from an invention by the German firm’s Felix Wankel.

Company Perspectives:

Curtiss-Wright really does have the “Right Stuff.” Formed from firms started by aviation pioneers Glenn Curtiss and the Wright brothers, the company operates globally in the aero-space, marine, and industrial markets. For the aerospace industry, Curtiss-Wright performs treating of jet engine metal and makes actuation systems used to control wing flaps. It also makes highly engineered valves for U.S. Naval nuclear propulsion systems and performs shotpeening and heat treating for metal durability and shaping in the automotive, construction, and agricultural equipment industries. Other customers include Boeing and Lockheed Martin. Insurance holding company Unitrin owns 43 percent of the firm.

A Management Flap in the 1960s

A series of defense cutbacks during the late 1950s hurt Curtiss-Wright’s ramjet development business, and the company’s earnings began to decline, falling from $25 million in 1958 to $14.3 million in 1959 as sales dropped from $388 to $329 million. In April 1960 Hurley was confronted by a hostile crowd at the firm’s annual meeting and faced criticism over falling earnings, reduced dividends, high officer compensation, and in-sufficient information regarding the company’s experimental developments. Hurley resigned as president and chairperson one month later and was replaced by one of his more vocal critics, T. Roland Berner. An attorney who had become a director at Curtiss-Wright after leading a nearly successful proxy battle against management in 1948, Berner had been instrumental in the 1949 shake-up that initially brought Hurley to power.

Berner quickly divested Curtiss-Wright of several divisions. The company donated its nuclear reactor to Pennsylvania State University and sold its South Bend and Utica facilities, Curon plastics business, West Coast research facilities, and its process for producing paving material from coal. Furthermore, the company’s plant in Lawrence, New Jersey, which had been making ultrasonics as well as quality control and testing equipment, was closed, plans for commercial production of the air car were dropped, and operations at Quehanna ceased.

Seeking to return Curtiss-Wright to the status of a leading aircraft engine manufacturer, Berner shifted the firm’s emphasis to defense and electronics products. During the early 1960s, Curtiss-Wright landed Air Force contracts for propellers, missile parts, and the modernization of the J-65 engine and began producing steel rocket casings for solid-fuel boosters for Titan III space launch vehicles. During the same period, CurtissWright’s electronics business was expanded through the acquisition of companies engaged in the manufacture of radar cameras and automatic timing controls for aircraft and missiles, as well as the manufacture of printed circuit board connectors for aircraft, missile, and computer applications.

Curtiss-Wright also expanded its activities in nuclear fields with the acquisition of an interest—and eventual complete control of—Target Rock Corporation, a manufacturer of hydraulic components and nuclear equipment. Curtiss-Wright also broadened its Canadian operations with the acquisition of companies engaged in the production of hydraulic equipment for oil companies and steel products for the building and mining industries.

In 1962, the company received a Federal Aviation Agency (FAA) contract to study compressor, turbine, and computer technologies for supersonic transport jet engines and began competing for a major government contract to develop and produce a supersonic commercial airliner engine. During the mid-1960s, the company sold its electronic fittings and components division at a time when it was plowing about $15 million of its own funds into the development of a supersonic transport plane engine.

Curtiss-Wright lost its bid to produce the supersonic engine, and, by 1967, the company had abandoned Berner’s goal to build complete aircraft engines, opting to become a first-tier supplier, or subcontractor, for other companies involved in aerospace and other fields. By that time, when Curtiss-Wright landed a Boeing contract to provide flight actuators to extend and retract flaps on the wings of the giant Boeing 747 jet airliner, its “power hinge” mechanics were already in use on a North American Aviation supersonic research plane, a General Dynamic’s fighter bomber, and a Boeing helicopter. Curtiss-Wright’s relations with governmental and commercial customers continued to improve, and, by the late 1960s, Curtiss-Wright was supplying components for Lockheed’s air bus and military transport plane and had become for many aerospace firms a preferred supplier of components for jet engines, helicopters, and aircraft, as well as a supplier of nuclear equipment and high-precision products for firms in nonaerospace industrial fields.

In 1968, Curtiss-Wright began an expansion program at its Buffalo extrusion facility, adding new forging and machining equipment for building aircraft and aerospace components. That year, the company acquired Metal Improvement Company, Inc. (MIC), an industry leader in shot peening technology used to create aerodynamic curvatures in aircraft and other products. The company’s operations also were expanded through acquisitions of domestic companies involved in the production of aircraft wing ribs and airframe parts and a Canadian manufacturer of metal-working equipment and supplies for the steel processing industry. In 1969, Curtiss-Wright acquired a majority interest in Dorr-Oliver Inc., an engineering firm that made mechanized equipment for airline cargo terminals; CurtissWright eventually acquired complete control of Dorr-Oliver.

Key Dates:

1929:

Curtiss Aeroplane and Motor Corporation merges with Wright Aeronautical Corporation.

1945:

World War II lifts annual sales past $1 billion.

1951:

Lead by Roy Hurley, CWC begins massive diversification drive.

1960:

New chairman Roland Berner orders sale of several divisions.

1967:

CWC drops jet engine business in favor of flap actuation systems and metal treatment.

1972:

Excitement over CWC’s Wankel rotary engine sends stock skyward.

1978:

CWC attempts hostile takeover of copper giant Kennecott Corporation.

1981:

Truce between CWC and Kennecott leaves Teledyne with 50 percent control of CWC.

1993:

CWC attempts to sell three of four divisions but finds no suitable buyers.

1995:

CWC opens a European Flight Systems subsidiary and expands overhaul business.

1998:

New acquisitions and long-term airliner contracts brighten CWC’s outlook.

Curtiss-Wright entered the 1970s as a producer of components or systems for all new wide-bodied commercial jet air-liners and most jet planes, at a time when cutbacks in defense and military spending resulted in fewer government contracts. When automakers and other firms began showing a growing interest in the Wankel rotary engine, Curtiss-Wright began extending licensing agreements for the engine. In 1970, General Motors Corporation (GM) paid $50 million to acquire a five-year nonexclusive license to develop and manufacture the rotary combustion engine in North America. Subsequent license agreements called for royalty payments to Curtiss-Wright for all sales of Wankel engines in addition to a licensing fee. Speculation on the potential for the development of the smaller, lighter, and more powerful Wankel intensified. By 1972, Wankel had become one of the hottest names on Wall Street, and CurtissWright’s stock was one of the most volatile and actively traded.

In 1972, Curtiss-Wright granted Wankel development licenses to Brunswick Corporation, a manufacturer of the Mercury line of outboard motors, and Ingersoll-Rand Company, for use in that firm’s compressor, pump, and electric generator assemblies. The following year, American Motors Corporation became Curtiss-Wright’s seventh Wankel licensee, about the same time that GM announced it would introduce the rotary engine in its 1975 Vega model. GM soon renegotiated its payment agreement with Curtiss-Wright, however, after indefinitely postponing the debut of the Wankel in its vehicles, citing emissions and gas mileage difficulties as motivating factors.

Takeover Battles of the 1970s

As interest in the Wankel declined, because of hydrocarbon emissions concerns, Curtiss-Wright began acquiring the stock of Cenco Inc., a maker of pollution-control equipment and medical supplies and an operator of nursing homes and hospitals. By July 1975, Curtiss-Wright had acquired 16 percent of Cenco’s stock. Upon learning that Cenco was entangled in allegations of fraudulent auditors reports and was on the verge of bankruptcy, Curtiss-Wright took control of the firm and placed Shirley D. Brinsfield, president of Dorr-Oliver, as Cenco chairperson. During this time, Teledyne Inc., a diversified firm with interests in electronic and aviation control systems and insurance, began acquiring Curtiss-Wright stock, and, by mid-1976, it held a 12 percent stake.

Also during this time, Curtiss-Wright was producing a wide range of military nuclear components, nuclear handling equipment, and nuclear systems devices, including special valves and regulators and seal weld fitting machines. The company also began actively developing turbine-powered generators, which were sold both domestically and internationally.

In 1978, Berner launched a proxy challenge to gain control of Kennecott Corporation, the nation’s largest copper company. Having already acquired a 9.9 percent interest in the mining concern, Berner charged that Kennecott had wasted assets in its $567 million acquisition of the Carborundum Company, and he proposed a dissident slate of directors committed to selling Carborundum and distributing the proceeds among shareholders, including Curtiss-Wright. Kennecott’s directors narrowly won the election, but a federal judge ordered a second vote. To stave off a rerun election, Kennecott convinced Thomas D. Barrow, an Exxon Corporation senior executive, to take control of the copper company, and within two weeks Barrow and Berner had agreed to a new Kennecott board, which would serve through the spring of 1981 and would give Berner’s faction a voice in the mining firm’s affairs.

Over the next two years, Curtiss-Wright boosted to more than 22 percent its stake in Lynch Corporation, a manufacturer of glass-forming machinery and flow instruments that CurtissWright had controlled for about 15 years. Curtiss-Wright also entered the heat treating market in 1980 with the acquisition of Diebel Heat Treating Company, serving the automotive, oil exploration, and agricultural equipment markets.

By November 1980, Curtiss-Wright had increased its stake in Kennecott to 14.3 percent, and its truce with the company was about to expire. Consequently, the copper company made a bid to acquire Curtiss-Wright, setting off a second round of corporate warfare. Curtiss-Wright responded to the Kennecott threat by initiating a buyback of its own stock to block takeover attempts, spurring a Kennecott offer to buy up Curtiss-Wright’s outstanding stock. As a result, Kennecott acquired nearly 32 percent of Curtiss-Wright and surpassed Teledyne as the largest Curtiss-Wright stockholder, though falling short of its objective for majority control. In January 1981, Kennecott and CurtissWright signed a ten-year truce agreement and Curtiss-Wright sold Kennecott its Dorr-Oliver subsidiary and its shares of Kennecott stock; in return, Kennecott gave Curtiss-Wright $168 million and the shares of Curtiss-Wright it held, which, along with stock tendered in Curtiss-Wright’s self-buyback, helped give Teledyne more than 50 percent control of Curtiss-Wright.

Reconfiguring in the 1980s and 1990s

Curtiss-Wright’s sale of Cenco—resulting in $9.8 million in earnings—along with a $52 million gain from the sale of Dorr-Oliver and Kennecott shares helped push Curtiss-Wright’s 1981 earnings to $85 million. Next, the company began investing in Western Union Corporation, acquiring a 21.6 percent stake in the telecommunications concern. This investment proved unsuccessful, however; Curtiss-Wright lost $42 million on the company, and as its 1984 total earnings plunged to $1.9 million—down from $18.5 million a year earlier—the company sold its stake in Western Union. Also during this time, CurtissWright abandoned its hopes for the Wankel, selling its rotary combustion engine business to Deere & Company after failing to discover a commercial application for the engines.

In 1986, Curtiss-Wright received an Air Force contract in excess of $40 million to provide wing-flap actuators for the F-16, leading to ongoing F-16 actuator business. The following year, Curtiss-Wright was forced to fire several Target Rock senior executives after discovering an embezzlement scheme that resulted in the indictment of several former employees and suppliers. Considered a victim of the embezzlements, CurtissWright was not charged with criminal misconduct in the matter, although in 1990 the government initiated litigation against Target Rock Corporation related to embezzlements by former Target Rock officials and their alleged mischarging of government subcontractors.

During the late 1980s, Curtiss-Wright’s sales and income remained fairly stable, fluctuating between $21 million and $28 million in earnings and $188 million and $212 million in sales. In 1990, the company’s revenues climbed to $214 million while earnings sank to $6.8 million, in large part due to a $13.8 million after-tax environmental charge related to soil and ground water contamination at the company’s former Wood Ridge facility. Over the next two years, however, earnings rebounded to more than $21 million.

In March 1990, Berner died and was succeeded by Shirley D. Brinsfield, an outside director and former chairperson of Cenco who pledged to focus Curtiss-Wright’s operations on manufacturing rather than investments. Charles E. Ehinger was elected president and Berner’s son, Thomas R. Berner, was elected to the company’s board. Less than four months after Berner’s death, Curtiss-Wright declared a special dividend of $30 a share. The primary beneficiaries were Unitrin Inc., an insurance company once owned by Teledyne with a 44 percent interest in Curtiss-Wright, and Argonaut Group (formerly owned by Teledyne) with an eight percent interest.

In July 1991, Ehinger resigned as president and Brinsfield assumed the duties of president. Curtiss-Wright sold the engine distribution business of its Canadian subsidiary and discontinued its remaining Canadian operations soon thereafter.

In early 1993, Curtiss-Wright announced that it would explore the sale of three of its four business units, including Metal Improvement Company, its Flight Systems Group, and its Buffalo Extrusion Facility. In May 1993, Curtiss-Wright’s presidency was turned over to David Lasky, a former senior vice-president, and, two months later, Curtiss-Wright abandoned at-tempts to sell its Flight Systems subsidiaries, as offers did not meet expectations. By October, Curtiss-Wright had reached an agreement to sell its extrusion business, while depressed conditions in the commercial and military aerospace markets led the firm to abandon the sale of MIC, which had garnered less than favorable offers. At the end of the year, Curtiss Wright’s Target Rock subsidiary agreed to pay the government $17.5 million to settle remaining litigation. The Target Rock settlement, coupled with environmental clean-up charges, contributed to an annual loss of $5.6 million on declining sales of $158.9 million.

Curtiss-Wright entered 1994 seeking expanded commercial markets in the area of pollution control, for which its electronic control valves were well suited. The company faced cutbacks in the production of commercial aircraft, a reduction in pricing levels and Air Force procurement of the Lockheed F-16 fighter plane, the termination of valve orders for the Navy’s Seawolf program, and reduced production activity in the Navy’s nuclear program. The future of Curtiss-Wright, which abandoned the sale of its subsidiaries in 1993 in favor of optimum shareholder value, appeared contingent on both the economics of the company’s traditional markets and the company’s success in broaching new markets. The company’s future also seemed dependent on its ability and desire to maintain its business units under the Curtiss-Wright name in an era of increasing consolidation and cutbacks in the defense and aerospace industries.

Climbing into 2000

After losing $5.6 million in 1993, CWC posted net earnings of $19 million on total revenues of $166 million in 1994. These figures remained flat for 1995. At the time, government con-tracts accounted for about 35 percent of the company’s business. Military cutbacks, primarily for the F-16 program and military valves, affected the Aerospace and Marine segments. The company also weathered development costs relating to the new Lockheed-Martin F-22, McDonnell Douglas F/A-18 E/F, and Bell Boeing V-22 Osprey programs. It also supplied Sikorsky Black Hawk and Seahawk military helicopters.

CWC won some contracts for which it was not the original supplier, as in several lines of Boeing aircraft, while its Metal Improvement Company subsidiary supplied peen-forming services for Airbus and McDonnell Douglas. CWC sold its Buffalo Extrusion Facility in June 1995. In spite of cost overruns for commercial nuclear valves, the industrial segment showed improvement.

A European subsidiary, Curtiss-Wright Flight Systems/Europe, opened in 1995. Overseas business, growing significantly, accounted for 18 percent of sales and 34 percent of profits in 1996. The company also opened shot-peening facilities in Belgium and Germany. CWC expanded its overhaul and repair business, capitalizing on the trend of airlines keeping planes in service longer. It bought Aviall, Inc.’s Miami-based Accessory Service unit for about $17 million. The company doubled the capacity of its aerospace plant in Shelby, North Carolina.

Sales were $219 million in 1997 and $249 million in 1998. The company announced another ten-year contract with British Aerospace Airbus for treating the metal surfaces of wings. At home, the company consolidated its actuation system operations at its Shelby plant due to military cutbacks, while the plant in Fairfield, New Jersey continued to handle management, engineering, and testing for military programs.

Boeing announced a slowdown in production in late 1998. CWC predicted little immediate fallout, however, and the company soon announced a new eight-year agreement for flight control systems with Boeing. It also was invited to equip two prototypes in Boeing’s Unmanned Combat Air Vehicle program. Within months, CWC announced a ten-year contract to provide shot-peening metal treatments for the Bell Boeing V-22 Osprey tiltrotor aircraft and its commercial derivative. (It also joined Milwaukee Electric Tool Corporation in a rescue tool venture.)

Government contracts averaged less than 20 percent of sales in the late 1990s as CWC sought out new technologies and markets. Curtiss-Wright Flight Systems acquired SIGAntriebstechnik GmbH, the drive technology unit of SIG Swiss Industrial Company Group, in early 1999. Its products were used mainly in commercial marine craft, high-speed trains, and military vehicles. In June, CWC acquired Metallurgical Processing, an automotive and industrial heat-treating company based in Fort Wayne, Indiana. The next month, it bought flow control business from Teledyne Fluid Systems.

Annual sales, at $293 million, were up 18 percent in 1999. Net earnings rose nearly 30 percent to $39 million. Motion Control sales rose 18 percent to $124 million, primarily due to the Drive Technology acquisition and a surge in commercial aircraft production at Boeing. After a banner year in 1998, Metal Treatment sales slipped a bit to $106 million. CWC’s Flow Control segment showed the greatest improvement, with sales jumping 71 percent to $65 million.

Forbes named Curtiss-Wright Corporation one of America’s 200 best small companies in 1999. David Lasky retired in April 2000 and was succeeded by Martin R. Benante as CEO and chairman. Lasky had been with the company 38 years; Benante had joined in 1978.

Principal Subsidiaries

Curtiss-Wright Flight Systems Inc.; Metal Improvement Company Inc.; Curtiss-Wright Flow Control Corporation; Curtiss-Wright Flow Control Service Corporation; Curtiss-Wright Flow Control Company Canada; Curtiss-Wright Flight Systems Eu-rope A/S (Denmark); Curtiss-Wright Foreign Sales Corp. (Barbados); Curtiss-Wright Antriebstechnik GmbH (Switzerland).

Principal Divisions

Motion Control; Metal Treatment; Flow Control.

Principal Competitors

Parker Hannifin Corp.; Aeroquip-Vickers Inc.; Telair International Inc.; Rexroth Corp.

Further Reading

Carley, William M, and Tim Metz, “Proxy Pugilism: Curtiss-Wright’s Bid for Kennecott Has David-Goliath Aspects,” Wall Street Journal, April 18, 1978, pp. 1, 39.

Combs, Harry, and Martin Caidin, Kill Devil Hill: Discovering the Secret of the Wright Brothers, Boston: Houghton Mifflin, 1979; Englewood, Colo.: TernStyle, 1986.

“Curtiss-Wright Engine Has Only 2 Moving Parts,” Wall Street Journal, November 24, 1959, p. 4.

“Curtiss-Wright Redefines Itself,” Aerospace Daily, December 10, 1998, p. 388.

“Curtiss-Wright Sees Its Earnings Growth Continuing This Year,” Wall Street Journal, February 18, 1969, p. 8.

“Curtiss-Wright, Studebaker-Packard Paths Marked by Mergers in Plane, Auto Fields,” Wall Street Journal, August 6, 1956, p. 4.

Eltscher, Louis R., and Edward M. Young, Curtiss-Wright: Greatness and Decline, New York: Twayne, 1998.

“Facing Reality,” Forbes, November 15, 1967, pp. 24–25.

“Hurley Gives Up Curtiss-Wright Posts; Berner, a Director, Is Named Chairman,” Wall Street Journal, May 26, 1960, p. 9.

“Kennecott and Curtiss-Wright End Corporate Battle by Agreeing to 10-Year Truce Involving $280 Million,” Wall Street Journal, January 29, 1981, p. 3.

Lee, Loyd E., review of Curtiss-Wright: Greatness and Decline, by Louis R. Eltscher and Edward M. Young, in Business History Review, Autumn 1999, pp. 533–35.

Lavelle, Louis, “Curtiss-Wright To Lay Off 90 Employees from Essex County, NJ Plant,” The Record (Hackensack, New Jersey), November 19, 1998.

Lenckus, Dave, “Benefit Termination Not Unlawful: Ruling,” Business Insurance, May 18, 1998, pp. 3f.

Martin, Richard, “Wondrous Wankel: Engine Not Only Drives Vehicles, But It Also Puts Stocks into Orbit,” Wall Street Journal, June 16, 1972, pp. 1, 25.

Shao, Maria, “Kennecott’s Battle with Curtiss-Wright Involves Ambitions, Strategies and Money,” Wall Street Journal, January 5,1981, p. 19.

Stevens, Charles W., “Curtiss-Wright Picks Top Officers After Berner Death,” Wall Street Journal, March 23, 1990, p. C18.

Tannenbaum, Jeffrey A., “Curtiss-Wright Slates Payout of $30 a Share,” Wall Street Journal, July 13, 1990, p. C9.

“The Well-Deserved Decline of Curtiss-Wright,” Forbes, November 15, 1967, pp. 24–26.

—Roger W. Rouland

—updated by Frederick C. Ingram

Curtiss‐Wright V. United States (1936).Using authority granted by a congressional joint resolution in May 1934, President Roosevelt embargoed all U.S. arms shipments to Paraguay and Bolivia in an effort to end their military conflict. In January 1935, the Justice Department indicted the Curtiss‐Wright Corporation for selling machine guns in violation of the embargo. The company countered that the resolution was an unconstitutional delegation of power giving the executive uncontrolled discretion to make policy.

In 1936, the Supreme Court upheld the resolution and the president's action. Justice George Sutherland's opinion held that in foreign affairs, unlike domestic affairs, Congress had authority to delegate broad power to the executive. Moreover, Sutherland claimed, the president exercised inherent, extraconstitutional powers derived from international law and practice—to promote national interest and survival. This sweeping assertion of presidential supremacy in international affairs came, paradoxically, at a time when the Court sought to limit executive power in the domestic arena. Sutherland's opinion is often cited to support the president's authority, as commander in chief, to commit U.S. armed forces to combat without Congressional authorization. However, in Reid v. Covert (1956), Justice Hugo Black's majority opinion suggested that all power, domestic and foreign, must flow from the Constitution. Black's opinion vitiated the argument for inherent executive authority in foreign affairs.
[See also Commander in Chief, President as; Supreme Court, War, and the Military.]

Bibliography

Clinton Rossiter , The Supreme Court and the Commander in Chief, 1951.
Edward Keynes , Undeclared War: Twilight Zone of Constitutional Power, repr. 1991.

Edward Keynes