Roller-Coaster Ride

Curtiss-Wright Corp. and its Chairman Roy T. Hurley are having their woes in the business of making aircraft engines, but when it comes to press releases, they fly high. Month ago, with sales down from $599 million in 1957 to $389 million in 1958 and still slumping, C-W displayed a "revolutionary" new air-car for U.S. travelers, a vehicle that has no wheels, but zooms along at 60 m.p.h. just off the ground on a cushion of compressed air.

Last week there was no further word of air-car production or of orders. But Chairman Hurley had another innovation to announce. Calling in the press, he displayed (but did not demonstrate) a radical new internal combustion engine billed as the greatest advance since the diesel. It has no pistons or valves, only two moving parts; there is a carburetor to mix air and gasoline, a single spark plug, a rotor that drives the crankshaft. Beyond that. Hurley refused details. CW, he said, had developed the engine in conjunction with West Germany's NSU Werke, makers of autos and motorcycles, and had exclusive North American rights. In the works, said Hurley, was a whole string of models from 100 h.p. to 5,000 h.p.

The news brought only a statement from NSU that it was working on such an engine, which "still requires much research before it can become a commercial proposition." Privately, the Germans were furious; they claimed that the engine was their invention, that C-W had helped with development funds, and that any announcement at the moment was premature. But on Wall Street, where Curtiss-Wright stock has been hovering in the mid-30s for most of the year, the stock hopped 3 1/4 points to 35 1/4. Next morning C-W could not open for 35 minutes because of all the orders. When it finally got going, the price was 38 a share, up another 2 3/4 points, quickly soared to 40 3/4, a new high for the year.

At that point, Chairman Hurley and C-W's board of directors had another piece of news: the company cut its quarterly dividend almost in half, from 62 1/2-c- to 37 1/2-c-. Sales for the first nine months of 1959 were down $40 million, with a $6,400,000 drop (to $9,000,000) in profits. Once again C-W was suspended from trading as investors tried frantically to dump their stock. When trading was resumed, C-W dropped, wound up 5 7/8 points below the high.

At week's end the stock had firmed a bit, was back to 36 1/2. But both the New York Stock Exchange and the Securities and Exchange Commission had some questions to ask Curtiss-Wright and its managers. The exchange began investigating to see if Chairman Hurley or any other officer had bought or sold C-W stock recently. SEC Regional Administrator Paul Windels Jr. questioned Hurley about the price movements of the stock. Said Windels: "We are investigating to see if this sequence of corporation actions was done deliberately to have an effect on the market."

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