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Juan Trippe
1899-1981

 


Though he made flying seem glamorous, Pan Am's founder really helped the rest of us get onboard. Juan Terry Trippe (1899-1981), the undisputed pioneer of the American overseas aviation industry, led Pan American Airways from 1927 to 1968. Having opened up Latin America, the African periphery, the Pacific, and Southeast Asia during the 1930s, Pan American played an important role in World War II before spearheading mass, low-cost tourism across the North Atlantic to Western Europe in the 1950s.
By RICHARD BRANSON for Time Magazine
 

 

By business school standards, Juan Trippe was not a model chief executive. He didn't delegate well. He made big deals without telling his top managers. He almost single-handedly built a world airline, Pan American, but often acted as if he owned the world. He also had a vision that would change it, at least as regards airline travel. While his Pan Am does not survive today, his vision does.

He graduated from Yale in 1921 and worked briefly on Wall Street but got thoroughly bored. Planes fascinated him, though. Trippe was convinced that the future of travel was in the air. With an inheritance, Trippe began a business with Long Island Airways in New York, a taxi service for the well-heeled. When that failed, he raised money from some wealthy Yale pals and joined Colonial Air Transport, which won the first U.S. airmail contract, between New York City and Boston. That same crowd liked to play in the Caribbean (excellent choice), where he created Pan American Airways Inc. from a merger of three groups. Trippe began service with a flight from Key West, Fla., to Havana, Cuba, on Oct. 28, 1927.

What characterized Trippe thereafter was an uncanny ability to pace his airline's growth with the range of the airliner as it slowly evolved: first crawling from island to island across the Caribbean and into Mexico, then extending to Central and South America.

Finally, it was Trippe's backing of the flying boat, the first Pan Am Flying Clippers, that pioneered global routes: across the Pacific and, in the late 1930s, across the Atlantic. By the end of World War II, Trippe had in place a route system that was truly global.

Before anyone else, he believed in airline travel as something to be enjoyed by ordinary mortals, not just a globe-trotting elite. In 1945 other airlines didn't think or act that way. Trippe decided to introduce a "tourist class" fare from New York to London. He cut the round-trip fare more than half, to $275 ($1,684 in today's dollars, which makes current pricing a bargain, right?). This went over like a lead balloon in the industry, where air fares were fixed by a cartel, the International Air Transport Association; it didn't want to hear about the tourist class. Incredibly, Britain closed its airports to Pan Am flights that had tourist seats. Pan Am was forced to switch to remote Shannon, Ireland. The industry's aversion to competition and making travel affordable was to have a long life, as Sir Freddie Laker would discover in the 1970s and Virgin Atlantic nearly a decade later.

Trippe managed to find one route where the cartel could not thwart him: New York to San Juan, Puerto Rico. Pan Am's one-way fare was $75, and the flights were packed. Finally, in 1952, Trippe's relentless attacks on the I.A.T.A. forced all airlines to accept the inevitability of tourist class. But by then his vision had taken off for its next destination. Flying the oceans was still mostly for the rich and famous. For millions of others, it was just a dream or a once-in-a-lifetime binge. Trippe saw that the jets being introduced by Boeing and Douglas could mark the end of that, and he ordered plenty of them. In October 1958, a Pan Am Boeing 707 left New York for its first scheduled flight to Paris.

The jet age had begun, and the transformation was dramatic. The 707 flew almost twice as fast, at 605 m.p.h., as the propeller-driven Stratocruiser it had replaced. The 707 carried about twice as many people. And for the first time, it flew mostly "over" the weather: typically at 32,000 ft., much higher than the Stratocruiser, a civilian version of the B-29 bomber.

But those were not the numbers that intrigued Trippe. While he brilliantly exploited the glamour of his first jet-set passengers — celebrities and VIPs — he was calculating the new jet-age math of what we call in our business "bums on seats" — the seat-mile cost.

The first 707s were flying with five-abreast seating, two on one side of the aisle, three on the other. Trippe switched to six abreast and cut fares, and the Pan Am jet clippers made flying "the pond" far more accessible. By 1965 the company was predicting that 35 million people would be flying international routes and that there would be a 200% increase by 1980.

The relentless Trippe had the big idea: he reasoned that mass air travel could come to the international routes only with a larger airplane — a much larger airplane. Trippe put the notion to his old friend Bill Allen, the boss of Boeing, saying he wanted a jet two-and-a-half times the size of the 707. It was a staggering request given the development cost of the 707. And Trippe didn't stop with size. Pam Am was operating the 707 with a seat-mile cost, at best, of 6.6. Trippe set for Boeing the goal of reducing that 30%.

"If you build it," said Trippe, "I'll buy it." "If you buy it," said Allen, "I'll build it."

My kind of guys.

Trippe said he would buy 25 airplanes. The price: $450 million, in those days big money. It wasn't yet called the jumbo (the Brits, I'm happy to say, came up with that one).

Pan Am under Trippe always rode shotgun with any new airplane it ordered. Trippe hired Charles Lindbergh to ride his airplanes incognito, and Lindbergh's ideas helped shape the cabin of the first jets. He also served as a pathfinder, exploring possible commercial air routes across the Atlantic and over the polar regions of Asia. Pan Am engineers crawled all over Boeing as the company conceived the outline for the new jet, the 747.

By pure chance, it was Trippe himself who gave the jumbo its signature bulge. In a rare lapse of vision, Trippe thought the 747 would be superseded by a big supersonic jet, as cheap to run as a subsonic jet. Some hope.

He therefore decreed that on the 747, pilots should sit above the flight deck so the nose could be opened up and take cargo. The 747's ultimate fate, he thought, would be as a flying Mack truck. Boeing showed him a wooden mock-up of the 747's flight deck, in the hump above the nose. He foraged around and came upon the space behind the flight deck, the rest of the hump. "What is this for?" he asked. "A crew rest area," said a Boeing engineer. "Rest area?" barked Trippe. "This is going to be reserved for passengers."

And so as co-creator of the 747, Trippe gave us the world's travelling machine. I launched Virgin Atlantic in June 1984 with 747s at the point when it was really shrinking the world and air travel was truly democratized, as Trippe intended.

Sadly, the 747 also sank Pan Am.

Trippe bought too many 747s in the early 1970s. A world oil crisis hit airline travel hard, and his business never recovered. Boeing itself almost went belly-up because of the cost of launching the 747.

Trippe had been a continuous innovator, but the sad irony is that he failed to re-invent his company for the leaner, far more competitive age he had done so much to shape: the age of travel for Everyman. A decade after his death, his airline, substantially dismembered, finally expired in 1991.

Throughout his career, Juan Trippe had been driven by the great American instinct for seeing a market before it happened • and then making it happen. In a real sense, he fathered the international airline business. To do so, he took on the entire airline industry, and risked his company to see his vision through. You've just got to admire a guy like that.

 


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Juan Terry Trippe (1899-1981), the undisputed pioneer of the American overseas aviation industry, led Pan American Airways from 1927 to 1968. Having opened up Latin America, the African periphery, the Pacific, and Southeast Asia during the 1930s, Pan American played an important role in World War II before spearheading mass, low-cost tourism across the North Atlantic to Western Europe in the 1950s.

Juan Trippe was born on June 27, 1899, to a well-off New York family, which, despite his first name, had no significant Hispanic connections. He attended the Hill School and entered Yale University in 1917. Trippe and some classmates became Navy pilots after America entered World War I, but they saw no combat. He later returned to Yale, graduated in 1921, and became a Wall Street bond salesman.

But Trippe and his wealthy associates were fascinated by aviation, whose future seemed rich with possibilities. Having bought some surplus Navy planes in 1923, they organized Long Island Airways before creating Colonial Air Transport in 1924 to fly between New York and Boston. Aviation attracted little business, however, until the federal government intervened to control entries, routes, and franchises, while also providing airmail contracts as virtual subsidies. After a dispute within Colonial over extending it to Miami, Trippe resigned in 1926 and formed a new corporation, which merged in 1927 with Pan American Airways. He became president and general manager.

Beginning with a 90-mile airmail route from Key West to Havana, Trippe spearheaded Pan American's spectacular expansion into the coastal cities of Latin America and established 11, 000 miles of routes by late 1929. He secured the indispensable U.S. airmail contracts and began lobbying for Pan American's position as a "chosen instrument" of American policy in South America, a continent of vast distances, impenetrable terrain, and many U.S. strategic and economic interests. State Department backing often bolstered his negotiations with foreign governments for routes, landing rights, terminals, and customs' privileges.

In 1929 W. R. Grace & Co. and Pan American organized Panagra (Pan American and Grace Airways) to operate on the west coast of Latin America. By the early 1930s Pan American had largely overshadowed its competitors in the region. In return for its government-sponsored quasi-monopoly abroad, Pan American followed Washington's tight regulatory policies by shunning the American market.

Pan American expanded rapidly despite the Great Depression and gained prestige by employing Charles Lindbergh, the "Lone Eagle" of public acclaim, and by turning what had been the adventure of flight into a safe, reliable, and profitable business venture. Trippe built an elaborate infrastructure of weather stations and communications, navigation, and maintenance facilities, first in Latin America and then on Hawaii and other Pacific islands. The Pan American market for long-range aircraft stimulated the American aviation industry, most notably in developing the comfortable, 60-passenger "Clipper, " with which Pan American pioneered service in the mid-1930s both across the Atlantic and via the Pacific to Manila.

Inevitably, Pan American became deeply involved in American foreign policy as World War II approached. There was constant competition over new markets with government-controlled foreign airlines, which contended that Trippe was building a global empire to strengthen American diplomatic and military power. Japan, for example, was angered, first when Trippe bought the China National Aviation Corporation in 1933, and again when he established links to British South Pacific territories after 1939. Simultaneously, the New York-Lisbon Clipper flights became famous, and very lucrative, as one of the few neutral routes into a Europe at war.

Pan American, now linked to the Air Force's global Air Transport Command, became a major contract carrier for the government after Pearl Harbor, particularly in ferrying planes from northeastern Brazil across Africa to the Middle East. Pan American even inaugurated air travel for a president, carrying Franklin D. Roosevelt to and from the Casablanca conference in early 1943. With its German and Italian rivals destroyed, and British and French international airlines greatly weakened financially, Pan American emerged victorious after 1945. But its international monopoly had ended as its American competitors learned the skills of oceanic flight when drafted by Washington into the war effort.

Trippe tried to revivify the "chosen instrument" concept by making Pan American (renamed Pan American World Airways in 1949) into a regulated monopoly, with the federal government owning 49 percent of the stock, but the plan died. In 1950, just as foreign air competitors were reaching American shores, he was refused the right to fly domestically, with the reliable income that this would generate. In 1952 Trippe encouraged mass tourism across the North Atlantic to Western Europe by instituting tourist class fares, with installment purchases after 1954. Volume flights required larger aircraft, and Trippe, having developed commercial jet service in the late 1950s, bought the first Boeing 747s in 1966.

But Trippe's desire to create a vast global system, servicing virtually every airport everywhere without strong regard for volume or profit, combined with a growing foreign and American competition to which Pan American could not adjust. There were major difficulties in the 1960s, with half-filled aircraft and shrinking revenues. Trippe retired in 1968, after 41 years at the helm, and died on April 3, 1981. His empire went downhill. A proposal that the shah of Iran buy it in 1975 was rejected. It filed for bankruptcy early in 1991 and ceased flying later in the year.


 

 

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This web page was last updated on: 16 December, 2008