Transatlantic Competition

When American Export (steamship) Lines Inc. organized an airline subsidiary in 1937, and announced it was going into the transatlantic trade, the U. S. flying business peeled its eye for developments. For tough, pioneering Pan American Airways, operating around South America and across the Pacific, was getting ready to start service to Lisbon on an Atlantic run. And in all its adventurous pathfinding, Pan Am had had no U. S. competitor to worry about.

Last fall Pan Am set out as an intervener before CAA to block American Export from getting a certificate of convenience and necessity. Chief contentions: that Export was not financially equipped for ocean trailblazing, that its personnel was inadequate, that on air lanes later to be invaded by French and British lines its competition would be wasteful and costly to U. S. aviation.

Last week Export won the first round of its fight. Submitted to CAA by its Examiner C. Edward Leasure was a recommendation that Export get its certificate. If CAA adopts the report, Export will begin with nonscheduled operation of its one plane--a Consolidated 28--between New York and Rome, with inter mediate stops at the Azores, Lisbon and Barcelona. Full passenger, mail and express operation will come later when Export gets the first of the three four-motored Vought-Sikorsky S-44s which it has ordered from United Aircraft Corp.

New feature of Export's proposed full-scale operation: a non-stop run to Lisbon in 20 1/2 hours without stop at Horta where Pan Am clippers now run into frequent delays because of rough water. Pan Am's contention that present equipment did not justify such a long haul was waved aside by Examiner Leasure. One of his points: Pan Am itself will run non-stop New York-Lisbon service when it gets delivery on six new modified Boeing clippers. His recommendation on other Pan Am objections:

> American Export can finance its operation by a public stock issue, equipment certificates for its new planes.

> There is plenty of air-passenger and mail business ahead on the Atlantic run to justify competition.

To one part of Export's application, Examiner Leasure deferred an answer. Overruled was a request that the steamship line be specifically authorized to hang on to control of the air line. Reason: That question can be decided by CAA later.

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