MR. COLLINS: Last time we talked, we examined your career before and up through the war, and in this session, I'd like to begin to explore a little bit more what the postwar situation was at North American. One of the things that you indicated in our previous interview was that there was a fairly strong move towards developing a stronger scientific and high technology capability at the corporation in the immediate postwar period, and you mentioned as an example bringing in Bill Bollay from the US Navy, I believe, to head up the Aerophysics Laboratory for you.

Mr. Atwood: Yes.

Collins: I thought it might be useful to pursue how that set-up worked in the North American situation. What kind of charge did Bill Bollay come to the organization with, to do?

Atwood: Well, maybe first a paragraph on our circumstances at the end of the war. We felt we had to close our operations in Dallas and Kansas City, which were wartime production plants. We anticipated a very small amount of business in the military airplane field. We brought back everyone we had sent to those outlying plants, and released the work forces that we had employed there. We were down to about 5000 people in our home plant here at Mines Field adjacent to Inglewood, California, near where we are today. We weren't exactly out of business, though.

    During the war, we had brought along two airplanes, that is, the designs of two airplanes. One turned out to be the B-45, which was a four engine jet bomber. The other turned out to be the F-86, which is called the Sabre Jet. Those were both first engineered during the actual years of the war, and carried over into postwar. We also had another plane which we really originated at the time of the war called the P-82, which was a radar-bearing night fighter type of plane, and we produced substantial numbers of them. So we were not exactly liquidating. We moved out into production on both the B-45 and the F-86 and the P-82, and we had some other miscellaneous work. By 1948 our employment was up to about 18,000 people again.

Collins: So as you were coming down from your wartime peak, you bottomed out at about 5000 people, is that correct?

Atwood: Yes.

Collins: Can you recall roughly what the wartime peak employment was?

Atwood: Well, we had reached something like 100,000. At the end of the war, we were at about 65,000, in three plants, three major facilities.

Collins: Now, when you say you brought your people back from the operating divisions around the country, you're referring to top management and engineering staff, is that right?

Atwood: Yes. Plus accounting people, supervision and active plant managers. Some went from plant manager back to general foreman. That type of thing. All the people whom we sent, and who were willing to return, came back here. But only those that were transferred. Some additional people, Joe McNamara, for instance, was an industrial engineer we employed at Kansas City, came back, was invited back here and he became eventually at one time chief of the space division. So we had a mixture, but we tried to save all the best people we could.

Collins: Let me just ask you a couple of questions about developing designs for the B-45 and the F-86. During the war time, was this work that you took on at your own instigation, or was it something that was stimulated by requests from the Air Force?

Atwood: You have to remember that the jet engine came to this country during the war. Imported, really. General Electric picked it up. So did Westinghouse. They began to make engines of U.S. design. But the jet engine opened up entirely new possibilities for military airplanes, and eventually commercial, of course. So we initiated these designs, but they were sponsored and financed by the Army Air Corps, Army Air Force, through contracts. They were not competitive contracts in those days. Everything was managed by the War Production Board and so forth. But they were contracts that were awarded based on the design and the expectation of jet plane performance.

Collins: So this work during the war was principally design activity.

Atwood: Yes, we didn't get much of them built during the war. I think they were only in the mockup stage and possibly might have been cutting metal, I'm not sure. Most of the work was done after the war, of course. That's why I wanted to point that out. The Bollay activity, if you want to classify it, might have been partly speculative. It was an attempt to lay a layer of capability, of future technologies, on top of our aeronautical engineering skills, with the objective in mind, of course, primarily of military weapons. The V-2 was right there before us. The atomic bomb had just been exploded. The implication of thesetwo was obvious to the whole world. To meet that unfolding requirement or opportunity, naturally the sciences of rocketry, ballistics, space physics, all that, became a basic requirement. So this was our effort to create such a capability, starting with people.

Collins: How was this initially, this Aerophysics Laboratory to pay for itself? Was this something that was just essentially an investment on the part of the corporation, or was this taken from profits?

Atwood: The initial iteration was all company money, of course. We turned a section of our manufacturing area over to them, a suite of offices and laboratory space, in what we called our tooling building, which was right down the road here. We provided these offices, and we began to provide other facilities. One of the first things we undertook was a blow-down wind tunnel. It was called after the German design, called the Kochel design, and that was a tunnel with a small throat, but we could evacuate a receiver, we could dry air in a container, suck the dried air through the throat, at supersonic velocities, and begin to test in those ranges ourselves. The throat was only something like 12 or 14 inches square, but it was up to Mach 3 or higher, you see, for a brief test. We had a towing table, where the analogy between high speed aerodynamics and hydrodynamics could be demonstrated and tested, towing models through a shallow basin. Well, that's crude, but it was one of the things that Bollay and his people started getting data on.

    We started rocketry in some abandoned bomb shelters which the Engineering Corps had erected during the war on the outside chance that we might have to evacuate the plant because of Japanese air raids, but they were never used for that purpose. We began the rocketry testing with things that were no bigger than whistles, shooting oxidizer and propellant of various descriptions, igniters ignited, testing efficiency. Right there I might point out that the chase is still going on in rocket efficiency. We measure that in the term "seconds," like seconds of time. That means roughly, crudely, that one pound of propellant or one kilogram of propellant will produce one pound of thrust or one kilogram of thrust for so many seconds.

    So we worked on that, and eventually, we acquired the Downey plant, which is 15 miles east, which had been used by Convair during the war to produce BT-13 trainers. It had been abandoned. We bought what we could, what was privately owned. There had been some government additions. We were allowed the use of those. And we began to expand and broaden. Now, the government part of it, it wasn't very long until Bollay and some of his people had received some study contracts from the Air Corps, the Army, because they were highly interested in this new phase of technology, naturally. Bollay was ringing their bell in the technical sense, so we got the research contracts, and we got a rocket test contract, elementary tests and that sort of thing.And finally, taking it on some three years, we got a contract to study an intercontinental cruise missile.

Collins: OK, what time period roughly are we talking about?

Atwood: We're talking about 1946 to '48.

Collins: That was the period in which you got the contract to do the study?

Atwood: Yes. We were designing and developing technology to support a long range cruise missile which was called by the Air Force the Navaho missile, and that became quite a project. In those days, the atomic bomb was a pretty monstrous affair. The one they were developing and planning to use weighed some 15,000 pounds. Rather an amazing hunk of metal. So in order to deliver that 5500 miles, it took quite a machine. So we had designed the cruise missile which was to cruise at Mach 3 1/4 and have a range of 5500 miles, and guidance system so that on termination, it would dive in and explode at the objective, and that guidance system was to have an average miss error of one nautical mile. Those were the design objectives of the Navaho.

Collins: These were the specifications that the Air Force suggested, or this was something that North American thought they could achieve?

Atwood: Well, the military always has requirements, which comes from the fact that they required so many tons of potatoes, etc. It still goes on now, they require that they will have so many jet airplanes that will do so many things. But these, of course, depend on reasonable expectation of what's available. This judgment, of course, is handled these days by some pretty sophisticated people, and in those days, they were less sophisticated but probably had just as many brains but didn't have as much data. So this requirement evolved, the testing, analysis and reasonable expectation. Bollay headed that in a technical sense, but the situation began to get out of hand in the sense of management.

    The rocket engine had begun to take on a life of its own. The guidance system expanded out of all proportion to what we'd started with. The missile itself got to be a major airplane effort, so the group began to divide itself into three components. In addition to that, we were studying diligently atomic propulsion, or the adaptation of atomic energy at least to what this missile might require. Now, we had some very good people in all those fields. In the atomic field, for instance, we had Chauncey Starr who was a scientist from the Oak Ridge group during the war. So this thing went through several degrees of evolution, but the first one was, I moved one of our most experienced engineers, a man named Lawrence Waite, to Downey to head this structure, as the manager and we called it MACE, Missile And Control Equipment. It received that name.

Collins: This would then be combining the structure and the guidance and control into one unit?

Atwood: Well, it was administered under one unit. We were not attempting to force them together physically. In fact the major drive was the other way. But we had contracts and expenditures and administration of all kinds to cope with, and it wasn't just like the airplane business, is what I'm trying to say. So we felt at the time it required a different tent, and an immediate ringmaster, if you like the analogy--I don't necessarily. But that's the way it began to develop. Now, you're back down to the elements here. We realized pretty early on that the rocket business is going to take more than revetments and a parking lot where we had a bomb shelter.

    So we began to look for land and a good facility, where a good facility could be erected. Land was much easier to get in those days, around here. In fact, at the end of the war, there was kind of a flattening out in all kinds of activity in the commercial sense, so we located this land at San Susana in the Santa Fernando Valley. It was controlled by the Dundas family. It had been used for nothing more useful than some "cut 'em off at the pass" Western movies. It had some defiles and rocky escarpments that were pretty good for movie sets, but the land didn't seem to be worth much. The Dundas family eventually sold us about a square mile up there for some $300 an acre, and we began to build a rocket test stand up there. It was pretty well isolated from residential areas and had a kind of a bowl effect, and the sound didn't propagate directly into the neighbors' windows or anything like that, so I felt we were pretty lucky to be able to get a test facility that close to general civilization.

    The next move in the rocket field was to start a plant and our office organization structure over in Canoga Park. It was about the time they were beginning to break up the old Warner Ranch, and so we were able to get property there, and that's where Rocketdyne Headquarters is today. It was, I would guess, 4 or 5 miles from the rocket test facility up a winding road. So that facility went on from there. You see, the Navaho was a cruise missile. It required a flying start, because it was going to use ramjet engines. At Mach 3 1/4 they were pretty efficient from the standpoint of use of fuel, and the range was feasible.

    But the rockets had to be used with a fuel tank almost like the Shuttle rig we have today, a tank for the rocket to boost the Navaho missile into its cruise condition and altitude. It took pretty goodsized rockets. You could almost say the Shuttle is a direct derivative of that system, although the Navaho did not use solid rocket boosters in addition, and the engines aboard the Navaho could not be fired up until they got up to speed. So it's different from the Shuttle, but it has a comparison.

    So we were developing rocket engines to handle the Shuttlelaunch conditions, and the first ones we produced that were capable of that were--well, let me back up to the V-2. It had about 56,000 pounds of thrust. The first engine that we produced for the Navaho launch had about 75,000 pounds of thrust. But it had a much better cooling mechanism. Anyway, I don't want to get into technical details right now.

    Then, going from the rocketry over to the guidance system, we had several good people that were attracted to that work, in fact quite a few, and as it went along, we got people like Norman Parker, who later became head of the Autonetics Division. We had John Moore, who was also head of it before that. Interestingly enough, we had Singleton from MIT, who later formed Teledyne and made a tremendous success in that diversified company. He was one of our guidance people. He quit and went with Litton and helped them build their intertial guidance division and later on he left Litton and formed Teledyne, you may remember. Anyway, this is only to illustrate the kind of people that were working on that guidance situation.

    At the same time, of course the gyroscope authority was Stark Draper of MIT, at the Instrumentation Lab. He'd been working that before the war, during the war, and after, and our Autonetics Division was not exactly a competitor and not exactly a spinoff, but it was starting to parallel what was going on at the MIT lab, and developed a guidance system for the Navaho. There wasn't anybody really in the industrial sense prepared to develop that guidance system. So we undertook it. Autonetics grew out of it.

    The guidance system was tested aboard an old Army transport plane, C-97, one that the Army could afford to direct to us for test purposes. They needed a big plane because the guidance system itself is probably bigger than this desk. But it had gyroscopes and it had electronic computers, and it was programmed and it began to test out the theories pretty well, just in flights around the country. Of course, every plane of any consequence has inertial navigation aboard today. But that was in 1950, roughly, when we were doing that testing. So that sort of defines the nature of this structure.

    I might add that the wings and body of the Navaho itself were being built in what we began to call the missile division, which was the third element of that--if you ignore the atomic energy, that was the fourth element of that MACE division or MACE organization. It was at that stage we got a little further developed, when we were able to break it up into divisions. About 1955, we had an establishment in Canoga Park for the rocket engines, we had the field laboratory at Santa Susana, we had the Autonetics Division in a separate building here at Downey. We had the Missile Division in the Downey plant, and they were, in reality, divisions. The MACE organization had become obsolete, and I think its structure lasted too long, frankly. There was some disaffection.

Collins: Could you describe why it became obsolete? What are you referring to there?

Atwood: Well, I think it might have been the nature of the aerospace overlay of some management people, who were trying to control the finances, the personnel, the salaries, the facilities and all that in accordance with some aerospace rules, and I think the friction just generated from that. Also I think maybe an unnecessarily conservative point of view on the part of some management personnel in the MACE organization might have been to some extent causing less than optimum progress. I wouldn't like to go much beyond that. But a very interesting circumstance came up.

    We were casting about how to get this thing better positioned, but the Secretary of the Air Force was man named Harold Talbott who was from Dayton, and I guess his family was a very strong Dayton group, and they were part of the Dayton-Wright airplane organization during World War I and so forth. Harold Talbott was a pretty gutsy type, and he had his ideas of how the industry ought to be organized, and aircraft people were starting to make fringe items like accessories for airplanes, and he didn't like it.

    He passed an edict, in other words, that airplane makers were going to stick to airplanes, engine makers were going to stick to engines, and people who made the radios and starters were going to stick to their business. It was really quite dogmatic, and could hardly have been propagated these days, but in the days after the war, wartime control and mobilization still had fairly strong overtones, I guess. In some ways Harold Talbott was quite rigid about it, and I talked to Gerald Brophy, our general counsel, about it quite a lot, and flying in the face of that seemed to be about as good a way to cut off our contract source with the Air Force as I could think of.

Collins: This would have been in the Truman Administration?

Atwood: No, no, Eisenhower.

Collins: Eisenhower, OK.

Atwood: 53, '54, '55. Talbott was Eisenhower's Secretary of the Air Force. But fortuitously, Harold Talbott got into what we'd call today an ethics problem. He had been financing a consulting firm which was doing business with aerospace industry, making money on the side. He was not active in it but he wrote letters on Air Secretary stationery to various people recommending his firm, and Eisenhower made him resign. And after he was gone, it seemed to us like an ideal time to make our move.

    So within one week, by decree, we'd established, primarily me, the divisional structure that grew out of MACE--named Sam Hoffman president of the Rocketdyne Division, John Moorepresident of the Autonetics Division, (both names were coined at the time), Joe Beerer president of the Missile Division, and Chauncey Starr president of the Atomics International Division. Well, no airplane company had come up with any subsidiary divisions and presidents, and it was quite a departure.

    There were some ominous grumblings here and there, but I went back to Wright Field, and went in to see Ed Rawlings, who was head of the field, full general, and some of his assistants, and explained it to him. So we got it all through, and didn't say anything much and Rawling said, "Well, it's your dime." Something like that. So in other words, if it'll work, OK, if it doesn't work, that's your problem. But it did work.

Collins: Are you implying that Talbott would have opposed such a move?

Atwood: Oh, very strongly. I'm not only implying it, I'm positive of it.

Collins: Why would he oppose it?

Atwood: He would think that we were getting away from our class. We were airplane makers. We were building the B-45, the F-86, P-82, and we were working on the F-100, which had just come into service, and we were getting ready to start in the competition on the B-70.

Collins: So was this more a preference, from his point of view as Secretary of Air Force, that the business of the Air Force was manned airplanes?

Atwood: No, no, no. You miss my point. The manned airplane people shouldn't try to make the engines for their machines and divert their effort, you see. Well, the Navaho was a classic case of going against his dictum. We were making the engine for it, making the guidance system for it, we were making the missile. He was dogmatic about it, and he was wrong. He had a point. People spread too far, too fast, they tend to stub their toe and collapse. But anyway he was out of the picture and we went ahead. Now, this is all a matter of record. I was pretty apprehensive myself, for a while.

Collins: About pursuing that?

Atwood: About how it would work. With one of our major customers, the Air Force. But fortunately, the quality of the work and various other things and the need for progress made it work. Now, about that time, the ballistic missile was aborning. It was being born in the minds of the scientists. As long as the atomic bomb weighed 15,000 pounds or any substantial fraction thereof, it probably wasn't going to be carried in a ballistic missile. But the scientists, Dr. von Neumann and others, had the idea of the hydrogen bomb. Of course, we didn't know about this, not beingcleared for that type of information. We were carrying the Navaho along, at the same time we knew about missiles like the Atlas, because Rocketdyne was being asked to design and build the engines for it. Rocketdyne was doing that, building the booster engines, and the sustainer engines.

Collins: This would have started in the early fifties.

Atwood: Right, early fifties. We were paralleling it with the Navaho work, as you see. Well, the government didn't know if the ballistic missile would work, and we didn't know much about the ballistic missile. About that time, of course, or a little earlier, General Schriever came out here to manage the ballistic missile work from facilities they first had in some abandoned schoolhouse and later on a street near the airport here, finally the Aerospace Division as it exists today. But the only part that North American had in the ballistic missile work then was the rocket engines.

    Of course, we had advanced much further than any other rocket builder in the world, for that matter. We had worked out the tubular system for regeneratively cooling the rocket nozzles, so the fuel would go down a tube all the way, come back the next tube, go into the combustion chamber. We'd worked out the turbine pumps, the high pressure that is required and all those things. So we developed our rocket engines, and of course, we were being supported at the same time by Wernher von Braun, whom the Army brought over to us from Germany, stationed at Fort Bliss, Texas, near the New Mexican desert where White Sands Proving Ground exists. He was soon moved to Huntsville, where the Army ballistic missile effort was concentrated, and of course he was keenly interested in our rocket engine work. He was in liaison with us on that, and after he got the position of technical director at Huntsville, he contracted for us to build rocket engines for the Redstone--the Army wasn't allowed to have a missile that would go over 200 miles. That was the Redstone. So von Braun was active in that work, and he'd seen me often and he was very much interested in the Santa Susana work, and spent a lot of time here, and so did some of his helpers.

    But at the time we dissolved the MACE organization, the head was one of our senior people, Waite. I'd brought him back to head up our contract administration work, and he worked until his retirement as one of the vice presidents in the corporate office. We did set the divisions up on a comparable basis to the way we operated Dallas and Kansas City during the war, with a top man, a staff, kind of a mirror image of the staff in the corporate offices, in what today they call a matrix organization, where the functionary in the division was responsible to his manager or president for most things, except for methods and company standards for which he was responsible to his functional chief at the headquarters. That's a very common thing today, but used to be very confusing. People were used to a section gang mentality.

Collins: What kind of mentality?

Atwood: Well, you know how the railroads used to send out section gangs.

Collins: Oh yes.

Atwood: With the little pump car, and a bunch of workers and the boss? You don't see those any more.

TAPE 1, SIDE 2

Collins: Continuing our discussion about the evolving organization of your missile, rocket, and control and guidance activity, I just want to get one person's name straight. You mentioned that one of the senior people was moved up to contract administration and planning, you're referring once again to Lawrence Waite, is that correct?

Atwood: Yes. He's still here. He retired finally.

Collins: I want to go back and follow up some thoughts on what you were saying. One was the degree to which the knowledge of German activity in missile work was available to you after the war, and to what degree it was useful. Do you have any sense of that?

Atwood: Well, the Army captured the V-2 parts, and they ended up at White Sands, New Mexico, I believe, and of course we got to examine them. We got information on their supersonic tunnels, as I pointed out, the Kochel tunnel was one. Well, we were offered the opportunity to send some engineers to Europe right after the war, to try to look at some of the remains of the German jet planes, better airplanes. We did send two or three people. We sent Ed Horkey for one, Ralph Ruud was another. He was a manufacturing man. Horkey was an engineer. And of course, we based the sweepback of the F-86 on some captured results that the Germans had developed, and Ed Horkey was pretty well aware of that sort of thing. I think we were up to speed with them on the state of the art within a relatively short time, let's say a year or two, and maybe ahead of them in some ways, although that's debatable, maybe in electronics we might have been.

Collins: But you did have access to the technical reports and stuff that were generated?

Atwood: Some. I don't know about the limitations, sorry to say, but I know we had some.

Collins: I'm also interested in your comment about the guidance activity for the Navaho, and you described it as a sort of a parallel to Stark Draper's work at the Instrumentation Laboratory. Did you mean by this that you were attempting to takeDraper designs and produce them in greater quantity, or did you mean something different by that?

Atwood: I didn't mean exactly that. The Draper pioneering was sort of pointing the way to the stable platform, which is a necessity, some kind of a stable platform, in inertial guidance. Although MIT had some ties with some commercial companies, supporting commercial companies--technically I think AC Sparkplug was one--nobody was in a position to supply us guidance for the Navaho. Nobody. MIT was not manufacturing, MIT was creating. So yes, I think you'd say the MIT information was in considerable part available to us, to our technical people, Bollay and others, although Bollay was a propulsion specialist for the Navy during the war. So I guess you would say we picked up MIT technology in guidance the way we picked up von Braun technology on propulsion. They were pioneering, we were improving, applying, developing enterprise.

Collins: This is a more general question. What kind of contribution did the Navaho work make to the North American organization, I guess both in terms of its financial impact in this early period when you were looking for business, and also in terms of developing fields of expertise?

Atwood: Well, of course, the income seemed large to us at the time. It was a few percent, like 6 percent, give or take a little, before taxes. Taxes were pretty high then.

Collins: You mean a 6 percent profit from the work?

Atwood: Roughly. But when we got through all of our work, up to the time I retired, we were averaging, after taxes, 2 1/2, 2 3/4 percent, which was considered good. The government carried inventory in considerable part, and ordinary manufacturers who carried their own inventory would have to gross more than that on sales, after taxes, unless it's a rapid turnover like a supermarket. Anyway, that's getting into economics, in which I'm no expert.

    But the Navaho added capability, it added some profit, it stretched organizational capabilities, it created really the rocket engine business. It created the guidance system business which we still have, in considerable strength. It augmented our aerodynamic information on high speed aerodynamics and control, though the wind tunnel testing done and the actual testing are the things that improved our structural capabilities in light weight structures, that sort of thing.

    Now, these benefits were not solely for our company. They ran with the contract to the government, and I've heard generals say that the Navaho greatly facilitated the ballistic missile program and other advanced technology programs of the Air Force. How to weight that, I can't tell you exactly, but the money would have been spent differently if it were all for research, and lessof it would have been spent, but it did have very valuable derivatives.

Collins: Now, the Navaho never really entered into production.

Atwood: No, it did not. The engine was really made by Curtiss-Wright, the ramjet engine. They hadn't gotten past wind tunnel testing. You see, the Navaho was cancelled in 1957 by dispatch, over night. We laid off about 10,000 people, all at one time. But fortunately, through the diversification and the divisionalization that we'd entered into, the activity in those areas was increasing. In spite of the divisional needs we did lay off 10,000 people. However, I think their re-employment, partly at North American and partly at other companies, was nearly 100 percent.

    Just after the cancellation of the Navaho, we had bid on another cruise missile, which was called the Hound Dog. We had bid on that, and Dale Myers was the program manager, one of our key engineers, and in competition we were awarded the contract. This development was a missile to hang under the wing of a B-52. It had its own star tracking device, which Autonetics worked out, it had its inertial guidance, and it had a respectable life, as a supplementary weapon for the B-52's over a period of a considerable number of years. And that picked up part of the slack when the Navaho was cancelled.

Collins: You would have had responsibility for doing all aspects of the Hound Dog missile?

Atwood: We didn't have the engine, of course. That was a regular jet engine. But we did have the guidance. We might have bought a lot of it, but we managed it.

Collins: Now, you may have already said this, but for the Navaho, your entry into that work was not through a competition.

Atwood: No, it evolved from components, first research and then supplementary contracts until it was a whole creation, a specification, and we were largely financed in that work, although, of course, not 100 percent.

Collins: I think the Navaho perhaps is a good example of a substantial source of revenue in the postwar period. That is, this R and D money versus production money. How significant did the availability of that kind of money become in making it, in corporate planning?

Atwood: Now, or then?

Collins: Then.

Atwood: Well, it wasn't really anticipated at the end of the war, although we made various studies, I guess you'd call them, thatwere speculation, the studies, and one I remember came up with an estimate that North American, if we did our job right, might look forward to a business like 100 million dollars a year, in the evolving defense atmosphere. Of course, we greatly exceeded that after a short period of time.

Collins: You mean in R and D type activities.

Atwood: Well, we were producing airplanes, see, which is where most of the money came from. On the annual sales, I don't think the Navaho work mattered much until 1950 or later. It was the F-86, the 82, the B-45, and work on support of other planes we built and things like that, most of the sales were. It began to become a significant fraction in, oh, I'd give 1950 as a date for you to perhaps contemplate.

Collins: Now, what came to be Autonetics, which focussed on guidance and control issues--were they also contributing to your aircraft contracts?

Atwood: They were not contributing directly to our aircraft contracts in any sizeable way. They had one project which was called the North American Search and Range Radar, and for short, they called it the NASARR. It was a very good system. Also we produced an attack system for one of our airplanes. It was used in a Columbus Division built airplane, the A3J which was a two-engine carrier-based attack plane which we designed and built for the Navy during that general period. We produced the guidance and control and radar for that. But the NASARR didn't go on any of our airplanes. It really went on the Lockheed F-104, which was sold to Germany. It had a mixed success. It had dozens of accidents and deaths because of its tricky flying qualities, but the NASARR did function the way it was supposed to. We built another system called the Mark 2 which is used by Convair, General Dynamics, on their F-111. It, too, was a radar and a fire control system, still being used in the F-111 today, It's rated to be the only plane in the inventory that will get off the ground when the birds are walking, over in Germany, and it was a good system, although it generated a pretty nasty overrun for many reasons.

Collins: That would have been later on.

Atwood: Well, it was in the fifties, late fifties and well into the sixties.

Collins: I guess what's interesting to me is that there was a lot of thought that went into the overall organization of the company, much of it directed towards handling what was really kind of the smaller part of the corporate business at this time.

Atwood: You see, the Talbot syndrome, if I can call it that, had to be overcome in a lot of ways. Back in the pre-war days andprobably early post-war, it didn't seem logical that, for instance, Douglas would buy anything from Boeing, except subcontract. And anything that could help a rival didn't seem to be quite the thing to do. Autonetics and Rocketdyne by definition had to sell to competitors, and to try to make their planes better than ours if they could, and so a lot of maturation of the industry was involved. This is a gradual process, and of course, it's pretty universal now. You find how particularly careful you have to be, because there are some proprietary things, especially in research and development, that people don't like to spread around even today, but the odds are that even the knowledge of these things doesn't help a company too much if they haven't aimed in that direction for a long time with their money, facilities and research. So the thing that Talbot was so worried about is essentially gone, but it's been a gradual change.

Collins: Let's talk a little bit then about the careers of these key people who headed up these scientific and high technology divisions. Tell us a little bit about Bill Bollay's activities.

Atwood: Well, Bill, he left us after about six years or so, before the MACE had gotten to be fairly massive and muscular, as it turned out later. I think his departure was based on two things--one, ambition to try to strike out for himself, in this rather fluid new field of aerotechnology, and secondly, he probably felt a certain growing disaffection in some of the administrative activities of the MACE organization perhaps. I can't weigh those and quantify them. I think that's probably true. He left with good feelings as far as I was concerned.

    He started a little organization called Aerophysics Company, and on his personal reputation, he employed, perhaps part time, I don't know, some pretty capable people or got them associated with him, and started on research contracts for the government, whatever agency he could work for. And he was paying the rent apparently and doing all right, although far from a big organization. Then some bigger company came and bought him out, and just what this chronology is, I'm not sure. I sort of lost touch. But he ended up with quite a bit of money, for those days, at least. These days, I can't think of quite a bit of money, from what I see in the paper. But he sold out and essentially retired, went to live in Santa Barbara, and I didn't know what happened to him. But Tom Heppenheimer told me that he'd had an unfortunate deterioration mentally into something like Alzheimer's. It's too bad. He had a very good mind.

Collins: Let's talk about some of the other early figures. Chauncey Starr is an interesting person. I'm curious how that end of the North American operation developed and fitted into North American.

Atwood: Well, he had gone pretty deeply, for a small organization, into atomic power. Up on the Santa Susana hills, we built for Atomics International the Sodium Research TestFacility. Sodium was one of the favorite coolants of atomic power plants, next to water. And it's better than Nak, mixed sodium and potassium, because apparently it doesn't pick up radiation and transfer it to a secondary loop. And we spent a lot of time on a sodium reactor.

    We built an organic-cooled reactor up at Santa Susana, financed by the Atomic Energy Commission, that worked with organic cooling fluids. We didn't get into water cooling particularly because of Westinghouse with their pressurized water, GE boiling water, but it was a pretty tricky course to shoot. Everybody was interested in it, and we were not a utility company, utility supply company, but we were getting involved with quite a few utilities in various types of studies and research and analysis, and the group made some creditable contributions to the atomic practices of utility companies, including the induction pump for liquid sodium, things like that. Chauncey was quite a well recognized person in the field, and we were doing quite a bit of business.

    We built what they called a SNAP reactor, which is nuclear power in space. It's been orbited and it's in orbit right now, as far as I know, will be for some thousands of years. It was experimental power for a satellite. That's before people became so tremendously conscious of the scatter of nuclear radiation. We built that and lot of auxiliary equipment for it. We had a nice facility over there, too, in the San Fernando Valley.

    But Chauncey was offered the job of dean of engineering at the University of California at Los Angeles which is UCLA. He was offered that by Franklin Murphy who was the chancellor, later chairman of the TIMES MIRROR NEWSPAPER. At any rate, Chauncey decided to accept the position, and John Flaherty took over Atomics International. John Flaherty had worked for the Atomic Energy Commission before and was pretty well versed in the business, although he was not a scientist in the character of Chauncey Starr. So Chauncey worked as dean of the school of engineering, which was, of course, a prestigious job, and I suppose he was very successful. He fits easily into academia.

Collins: Is he still active?

Atwood: Chauncey finally left UCLA to become president of APRI [American Power Research Institute, Palo Alto, CA ] It's the research arm of the privately owned utilities of America. And he headed that as president. He wrote me a letter not too long ago, said it was one of the best times of his life. Research he was able to follow, and other work he did. He's now retired and lives in Palo Alto, California. I'm sure he'd be responsive to any reasonable communication that anybody wanted to have with him. I considered him a very good friend and associate, and a very capable man.

Collins: Did people in the Atomics International side of thingshave to have a higher level of clearance for their work than other staff in the company?

Atwood: It depends on what you compare it to, but I'd say yes.

Collins: Did this hinder interaction with the rest of the corporation?

Atwood: Oh, not particularly. I think the clearances were of such a nature that the people in administration and ordinary engineering wouldn't have much reason to know anyway in most cases. At some point I'll tell you what happened in Atomics International. Chauncey Starr left, and when we were negotiating to merge with Rockwell Standard later on, Flaherty had been talking to Westinghouse, and of course, I personally had become a little disillusioned and somewhat apprehensive about atomic power and the strictures that were involved, and actually the public aspect of it. It was a time of diminishing enthusiasm, I might say.

    Westinghouse offered to buy Atomics International just about 1967, and they offered to pay 30 million dollars for it as a going organization. And I had tentatively agreed to it, thinking we would be concentrating on things we knew more about, for one thing. These days they say restructuring to core businesses, which terms we didn't think of in those days. But we were on the verge of merging with the Rockwell company, and they raised great objections to getting rid of Atomics International. And so our board, talked it over and decided that if Rockwell thought that way about it, it wasn't any time to be throwing off any of our assets, although I have to admit that I didn't think the 30 million dollars would have broken our company nor did I think that keeping it would have done either one either. But when I look at the Rocky Flats headlines, I'm beginning to wonder if I shouldn't have been more apprehensive than I was. But it went on from there, and of course it's been doing relatively low level work ever since. John Flaherty went back with the government, incidentally. He's in Washington today, as far as I know.

Collins: Let's look at Autonetics. First it was Larry Waite who was there originally, then John Moore.

Atwood: Yes, John Moore. John was an engineer, a good one. He became head of Autonetics and he managed it until we merged with Rockwell. Right at the time of the merger, I had to set up a structure of organization which was far from ideal, but it was a point to evolve from, and I put John Moore over the aerospace and of course, we'd employed Bob Anderson as head of the automotive work. That's the way it worked for a year or two, and of course we were in the middle of the Apollo program and finishing the XB-70 program, in addition to all our rocket work and everything else we were doing.

    So John held that position as head of the Aerospace groupfor at least two years, but when it came to naming an executive vice president in 1969, the board and I selected Bob Anderson, and of course that meant he would be president, unless something happened. Then Moore stayed on of course but Rockwell, I feel sure, let him go very shortly after my retirement. He never told me just what happened, but he's retired. Now, John got a job at Northrop, as a number of good North American engineers did. He finished his career in business recently as head of Northrop's electro-optical division out at Anaheim. John's a good friend. I see him once a year or so. He lived over in a community in the Valley, but now in Oxnard I guess. I have to call him pretty soon, I think he must be retired because I read in the paper where they dissolved and scattered this electro-optical division.

    Now, that division before was headed by a man named John McCarthy. He was a PhD from MIT--I mention his name now because he was a big factor in the technical work on our Apollo command module, and his name will come up later as we go into that. But he died two or three years ago, from some misadventure, I guess it was heart attack or something like that. It was very unfortunate. He's quite a loss. He was a relatively young man and very capable. So John Moore is still available.

Collins: OK. I think he's somebody I'd like to talk to. We've talked about the development of some of the science and technology aspects of the organization. I'd like to go back and look at, when you became president in 1948, how it is you worked in your position, what your responsibilities were and how you worked with staff around you and with these division heads.

Atwood: Well, of course, you couldn't codify my position very well. I'd back up just a minute. I first worked for Dutch Kindelberger over at Douglas. As you know, he was chief engineer there, and I worked under him. Arthur Raymond was assistant chief engineer, so by definition I worked under him, too. Dutch and I became very good friends. He was about ten years older, but we were very compatible in a lot of ways, and we became intimate friends--that is, our families--his daughter still seems almost like one of my own children. But he died at an early age.

    He didn't have much tolerance for organizational niceties, or protocol. He was a very pragmatic and down to earth forthright individual. Of course, I like that kind of thing too, although I'm maybe a little more stilted than he is. He wasn't at all. But we were very good friends, and I was chief engineer through the period when we were developing our line of planes before the war. I had my troubles but I got pretty good planes out on it.

    But he was trying to get somebody to be assistant to him, and he hired two or three people. One was Ed Doak. Another whose name I don't even remember. But they just could not cope with him, didn't understand him. He was very quick mentally. They didn't satisfy him. All during this time, I would talk with him,be at his house at night frequently. We'd socialize, all those things, and travel together. He liked to have me go with him on trips to go to Army and Navy people and describe our progress and all that. So I almost backed into the job of assistant general manager, and I slowly backed out of the job of chief engineer.

    But there was a day when we named Raymond H. Rice as chief engineer. During the war, he was truly chief engineer. A very good one. I want to talk about him later. He's still alive, but unfortunately in very poor condition, physically, I'm told. I want to talk about him some later and also a man named Stan Smithson who left Douglas with Kindelberger and myself. We were very informal, and I had more of a knack for whatever protocol we needed, perhaps, and I was more of an engineer. He was a hands-on man, a manager, a businessman, a decision maker, a doer. And I became--I don't know if a piece of paper ever passed--at first, assistant general manager. Later the board made me first vice president, that was the title.

Collins: According to the record that was 1941.

Atwood: Could have been, yes. But before that I was serving as his deputy, administering contracts, making decisions, within the framework. Of course I talked to him about nearly everything. We were two or three times a day in each other's offices. So how my duties changed in 1948, I can't really tell you. On the minutes of the board I was president. On the orders I signed out, I was president. Before that I'd sign first vice president. And we were very compatible. I don't remember many things that Dutch had reversed me on.

TAPE 2, SIDE 1

Atwood: To go on about Dutch Kindelberger's and my relationship, he accepted what I did pretty much, and directly he complimented me very highly at times to military and others, but that's beside the point. As I started to say about his--I won't say contempt, but close to that for formalities and even organization, I'd begun making some organization charts, and they hadn't been used very much in the company. I had to during the war and that sort of thing. At one point I had a chart and I showed him, so and so is going to be manager or something. He said, "No, not manager." He said, "The only manager around here is me." So I had to make him foreman or something. That was the way he thought in the early days. And I think one time I was talking pretty loosely about getting a contract to build some atomic power plant. I didn't have anything definitely in mind. He put his foot down and said, "We're never going to do anything like that."

Collins: This would have been during the period when the Atomics International was starting?

Atwood: Just starting in, yes. But 1948, my title changed. I don't know whether my compensation did. I don't think so. Butduring the war, I was close as I could be to engineering and the engineering transplants in the divisions, and the changes and the modifications. I've described that to you before. I was active in administration of the contracts. This seemed to be of considerable less consequence than it was during the competitive pre-war period, but we had to administer them, get the contracts closed out, account for everything financially and so forth. And I think I kept things pretty tidy in that respect. We had a lot of manufacturing problems and crises, but they had more to do with supply of materials, priorities, allocations, even personnel. One of the Congressional hearings we had was squabbling about whether we had too many people on deferment working in one of our plants. That type of thing, you see. Well, that's administration in a general way, but I was doing that and at the end of the war I was very active in the restructuring of the technical work.

Collins: You mean, towards science and technology.

Atwood: Yes, and then of course the development of the F-86 and the B-45. I was particularly intrigued by the F-86 problem. The first jet plane in this country, the first one in England too, had side inlets for the engines and a plenum chamber for the engine, and I was determined we would get intake air through a duct from the nose, and I spent quite a bit of time trying to insure that that happened. And it worked out. We had to distort the duct a bit, but made it gradual enough to where we didn't have any cavitation or vibration in the engine. It was supplied with very good quality air pressure. Things like that I would do, and I was active, and Dutch's deputy. He, of course, presided at the board. He took care of most outside contacts, at least, participated in high ranking contacts, generals, admirals, mayors, congressmen, secretaries, emissaries, ambassadors. He had good relations with the English. I was involved in those things too and we were fairly much a team, I guess you'd say.

Collins: That's a pretty big scope of activity. How did you know when to direct yourself to a particular problem? What kind of staff did you have around you to help you analyze what needed to be done?

Atwood: Well, up until the MACE organization was pretty well done, we didn't have what you'd call a technical staff in the headquarters. We had a financial chief, of course. We had a head of manufacturing, Smithson. Of course they had to, the way the manufacturing was subcontracted and sent to Kansas City and Dallas and all those things. We had a personnel director to unify personnel policies employment, wages, union negotiations, all those things. We had the usual staff functions. But technical staff didn't develop until later on, and it was a hard job to fill, I think mainly because I was not likely to depend on any staff guy for final technical judgment. That's a weakness of mine, of course.

Collins: Can you give me some examples in which technical judgment was required at your level?

Atwood: We've been through many transition periods, but I think of one type of situation, let's say postwar, when we had divisions, and we had contracts and we had all sorts of expenditures. We had two or three types of internal documents that we'd use for an expenditure. One was an interdivisional work authorization, that is, if one division wanted another division to do some work for them--whether it's manufacturing, engineering, research or what, they'd send this piece of paper. We had another type of document which was independent research and development. By independent, that meant separate from contract charges, called R&D.

    We had documents for authorization of facilities, machinery, computers, such things as that. Well, I had pretty well worked the facilities authorizations over to Stan Smithson, and he'd get more or less the bulk of appropriations for facilities and he allocated pretty much the facilities money. Even for test stands and things like that on authorization of the technical people. The other divisional work authorizations weren't much of a problem, usually, except for the big ones.

    But the independent Research and Development, I kept pretty much control of that, and had very little committee work. Not like things are today. Because people would come from the division, a technical team with their plan, their objective and what it would cost, and we'd talk about it for an hour or two or three, and I'd sign an authorization for them to spend money. This got to be one of the most interesting games in town, and there used to be all kinds of levity about it in the divisions, but it was selected work that would enhance the quality of work on something of importance, or would put the company in a better position competitively.

Collins: Was this work that could be charged to a contract?

Atwood: No, it's independent. If it was chargeable to a contract, these were part of the budgets and allocations of the contract. This would be money that the company would have to pay out of its bank account, and there was a lot of it, and some of it was very critical. I'd keep getting people--I'd go to these retiree meetings, and the supervisorsory banquets and things like that they have every year or so. People would still come to me, "Do you remember the time we authorized that? Well, you know what that meant to such and such?" I said, "Sure, I remember." Of course, I did try to keep control of executive salaries in my office. That was another thing that occupied some time. Promotions and demotions, actually. And general progress reports.

    At the end of the war, I started a little practice that I think may still be continued in the divisions. I used to haveevery week, a conference. We were only one plant then. I would have the head of manufacturing, chief engineer, financial man, various key people in project management, to make an informal verbal report around a table. I think it was Wednesday mornings we'd have it for two, two and a half hours, something like that, and debate those things to some extent. You can't do that in a company spread out of many divisions, but I think it brought us into a fairly close understanding of almost everything of consequence that was going on during that period up to say, 1950 or later, maybe '55. When you get divisional heads, you can't demand they come over for a staff meeting and report on all their functional areas. We didn't do it that way. The divisions were doing that sort of thing for quite a long time, anyway.

Collins: How did you keep tabs on what the divisions were doing?

Atwood: Oh, a dozen different ways. We got in some trouble, of course. You don't keep tabs 100 percent. But I had one method that, when we were smaller--it wasn't a project method so much as it was a general control method. Overhead is hard to control. We've had direct labor areas controlled forever, daily, almost hourly. Overhead control is a little different, because people can't divide their time periods. How many projects in a day, a planner can't spread his time that way. So I finally got onto something that worked. It was a personnel count, each month, to justify any more personnel, justify those you've got. That was a very effective thing in a small company.

Collins: Shall we go ahead and break at this point?

Atwood: We'd better.

Rev. 08/13/96