Payoff for Pioneers

The coveted Government contract for the first space capsule designed to carry a man into orbit around the earth (see SCIENCE) went last week to St. Louis' McDonnell Aircraft Corp. The contract itself was modest--only $15 million--but the prestige is enormous. Twelve topflight companies submitted plans and bids on the project. McDonnell won because its president, James S. (for Smith) McDonnell Jr., and his engineers had long since anticipated the Government's needs. They had been working on the project with their own money for more than a year, before the Government decided to go ahead. When the Government called for proposals on a hurry-up basis, McDonnell was ready with the best plans, even though its bid was not the lowest.

The capsule was a prime example of the kind of advance planning that has turned a small, second-rank outfit into one of the industry's highest flying companies, standing 13th among all defense contractors. McDonnell Aircraft's sales last year hit a record $442 million (up 32%), while net income climbed to a peak $10 million, with still more gains forecast for fiscal 1959. Current backlog alone amounts to $600 million. All this from a fledgling that delivered its first design barely 16 years ago and four years ago fell into the kind of trouble that could have wrecked it.

Demon & Voodoo. Founded in 1939 by Engineer-Airman McDonnell with the help of the Rockefellers, the company taxied around until after World War II doing mostly subcontract and experimental work. Finally it took off with the first production order for a plane of its own design, the FH1 Phantom, the Navy's first carrier-based jet fighter. Other orders (800 planes) followed for its second plane, the F2H Banshee. What almost proved McDonnell's undoing was No. 3, an ambitious supersonic carrier fighter called the F3H Demon. It proved too heavy for its Navy-specified Westinghouse engine (in itself a problem child), and turned into a $265 million fiasco for the Navy (TIME, Nov. 7, 1955). The setback would have crippled many companies, but McDonnell kept arguing that the plane was basically sound, proved it with a more powerful Allison J-71 engine which made the Demon so hot that the Navy eventually boosted its orders to $450 million.

Since then, McDonnell has come along fast. From a strictly Navy supplier, the company became a pillar of the Air Force with $1.2 billion worth of orders for its burly F101 Voodoo jet, a plane fast (1,200 m.p.h.) and versatile enough to perform every job from tactical A-bomber to all-weather interceptor. McDonnell went into missiles and helicopters, landed an $8,000,000 contract for its XV1 convertiplane, another $45 million for its high-speed Quail bomber decoy drone. Latest project: the supersonic (Mach 2 plus) F4H fighter, which beat out Chance Vought's F8U3 Crusader for an initial $170 million (23 planes) Navy contract.

Tunnels & Tools. Now McDonnell is training its sights on space. "Mr. Mac," as President McDonnell likes to be called, is certain that space flight is ''one of the most rapidly evolving fields of human creativity in the history of the world," and he is determined to win a place on the planets for his company. A tireless worker (eleven hours a day, six days a week) and an omnivorous reader, he devours everything on space he can find, scans every proposal in such microscopic detail that section chiefs must bring along their junior engineers to answer his pinpoint questions.

To make sure his men have the tools, he pays out at most 15% of profits in dividends, pours 85% into the company to expand research and development. Last year he spent $3,700,000 for a new advanced research lab that includes a 12.5 million-watt radiant heating unit to simulate the fantastic heats of atmospheric reentry. This spring a new $5,137,000 wind tunnel will be finished to help solve the problems of flight at speeds up to 4,000 m.p.h., temperatures from --65DEG F. to 660DEG F. and altitudes up to 125,000 ft. McDonnell's race for space is not just for business reasons. Says Mr. Mac, with something akin to missionary hope: "The space exploration rivalry can be a creative substitute for war."

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