The Veteran Pilot

At an elegant Manhattan dinner party some years ago one of the guests tried to start a conversation with the man to her left by asking how many languages he spoke. The balding, big-chested diner looked up from his plate and replied: "One--poorly." For Cyrus Rowlett (known universally as "C.R.") Smith, one has always been enough.

Born to a hardscrabble family in Minerva, Texas, Smith built American Airlines from a struggling group of merged regional carriers in the mid-'30s to one of the nation's fastest-growing and most profitable lines in the '60s. In 1968 he finally jetted off to Washington to serve as Commerce Secretary in the last days of the Johnson Administration.

Last week American decided that it wanted to hear Smith's kind of language again. The company's board called the now 74-year-old C.R. out of an active semiretirement with a Wall Street investment banker and installed him once again as American's chairman. Smith replaced the scholarly, soft-spoken George Spater, whose most recent misfortune had been to admit that in 1972 the company made an illegal $55,000 contribution to President Nixon's re-election campaign. Smith showed up at his office overlooking Manhattan's East River by 8 a.m. the next morning, greeting old friends and pecking out the brief, curt notes to American executives for which he became famous. Said an official of the airline: "Employee morale took an upturn in the last 24 hours the like of which has not been seen here in years."

It has a long way to climb. On the same day as the Smith appointment, American announced that its losses for the first eight months of the year had risen to a staggering $26.3 million, v. a profit of $12.4 million over the same period in 1972. Financial analysts expect the red ink for all of 1973 to exceed $30 million. The company's underlying problem is that it owns far more wide-bodied jets than it can run at a profit (TIME, July 2)--a dilemma that even Smith's wealth of experience and operating wizardry may be hard pressed to solve. Even so, the news of Smith's return had one tonic effect, the company's pallid stock actually rose about 8% to 11 3/4.

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