Argus-Eyed Argonaut

When Juan Terry Trippe got Pan American Airways into the air in 1927 he knew every wrinkle in its flying equipment (a lone trimotored Fokker), every part in his stockroom, every wavelet in the go-mile mail route between Key West and Havana. In his eyes was the dreamy gleam of the empire builder, behind his disarming smile a grim determination.

Today Pan Am has its empire, the most spectacular and successful international airline in the world. Spanning 53 countries and colonies in both hemispheres, it owes as much to Juan Trippe's genius for a tough diplomatic bargain as it does to his uncompromising insistence on operating perfection. From Lisbon to Hong Kong, from Nome to Buenos Aires, its 63,000 miles of airways, its 263 bases, run like clockwork. Without Trippe's astute bar gaining in foreign capitals, without his engineer's supervision of technical development, it might today be no more impressive than Britain's conservative Imperial Airways.

But Pan Am, grown to international complication, is still all within the grasp of Juan Trippe's Argus-eyed mind, down to the last pontoon float on the Alaska run. He is still Pan Am's one-man filing cabinet. He had flung out new lines, directed deals for foreign landing rights, drawn performance specifications for new airplanes that were years ahead of current design, and kept manufacturers on a hectic hop. The line revolved in a controlled orbit around him, and him alone. The head of the Atlantic division knew all about his piece of the system, the head of the Pacific division knew everything that was going on between San Francisco and Hong Kong. But only Trippe knew what was going on everywhere and only Trippe could make it move.

To the seven-day-a-week soul of Juan Trippe this was as it should be. But for a long time the one-man control of Pan Am had worried his Board of Directors, which represents such money bags as Lehman Bros., New York Trust and Bankers Trust, such earthbound transport entities as Atlantic Coast Line R. R. and United States (shipping) Lines.

What worried them most was that there was no way of keeping up with Juan Trippe, no way of making him observe the traditional amenities of big business. Many a directors' meeting was devoted to approving what Trippe had already done. What worried them almost as much was the growing conviction that hard-riding Juan Trippe, impatient of competition, unwilling to take anything for his company but the long end of a bargain, was giving Pan Am a reputation for one-man control that was unusual even for the individualistic flying game.

Finally Pan Am's directors decided to do something about it. In 1938 the company had earned only 3-c- a share on its 1,406,800 shares outstanding (top earnings $1.85 on 643,959 shares in 1935). Millions had gone into its transatlantic run, and Pan Am, so they thought, had grown too big for one boss. Last March Juan Trippe's wings were clipped. To by-pass most of his administrative functions, the Board named another man Chief Executive Officer: its chairman, polo-playing Cornelius Vanderbilt ("Sonny") Whitney, one of the original Argonauts who backed Trippe 14 years ago and had been Trippe's friend through most of the great adventure.

On the job to see that "Sonny" Whitney took over some of Trippe's job (but not technical operation of the line) was an Executive Committee (now headed by Sperry Corp.'s President Tom Morgan). But this counterbalancing idea just did not work. When, for example, Pan Am faced competition by up-&-coming American Export Airlines on the transatlantic run, the files had no answer to what to do. The answer was "Ask Trippe." When a change had to be made in the Azores station or on Midway Island the answer to what had gone on before was the same, "Ask Trippe." And for many such questions Trippe had shorter and shorter answers.

Last week, while the gossipy flying game was still predicting that Trippe would be boss again or quit, Pan Am made an offhand but significant announcement: Trippe had taken over Whitney's title as Chief Executive Officer. On the job still stayed Tom Morgan's Executive Committee. To the South for a month or so of sailing and sunshine went easygoing Cornelius Vanderbilt Whitney. Pan Am's vast fleet--131 planes--flew on to far horizons.

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