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Hughes, inheritor of a $16 million fortune derived from oil-drilling equipment, had become chief stockholder of ten-year-old TWA in 1939. He and President Jack Frye pushed TWA into technological airline leadership with such innovations as the feathering propeller, the automatic pilot, wing and propeller deicers, and wing flaps for shorter and safer landings. Yet flashes of brilliance and even the visionary decision to put TWA into the overseas trade could not make up for the caprices of Howard Hughes, whom an associate once dubbed "the spook of American capitalism." He abhorred the details of decisions involving money, even his own. Instead, he loved to tinker over the design of interior cabinets or galley layouts while a succession of five TWA presidents in 17 years begged him to make up his mind what planes to buy.
Costly Rescue. Frye quarreled with Hughes and quit in 1947 while the company was in the throes of serious losses. In return for more common stock, Hughes came forward with a major loan ($10 million) to keep TWA flying. In time, he hired a gifted administrator, Ralph Damon, who got the airline back into the black by pushing low-cost tourist fares. In 1956, Damon died of pneumonia, and TWA's fortunes plunged into five more years of turbulence. By now, Hughes had virtually vanished from sight, dealing with TWA's officers by phone, often in the dead of night, or through lawyers, or sometimes not at all. Carter Burgess, an Assistant Secretary of Defense whom Hughes picked as president a year after Damon's death, never saw his boss. Once, Hughes summoned him cross-country to a Las Vegas conference but left him all night in a hotel room waiting for a phone call. Burgess quit after eleven months of frustration.
Because of Hughes's habits, TWA was late ordering—and obtaining—jets, a lapse which let Pan American run away with the lucrative transatlantic trade for several years. Then, characteristically, Hughes ordered so many jets that even his fabulously profitable Hughes Tool Co. could not meet the bill. While he still could have done so, Hughes brushed off proposals that he give up a small part of his 78% ownership of TWA to raise money. In the end, forced to borrow $165 million or face receivership, he had to surrender operating control of TWA to the Metropolitan and Equitable life-insurance companies and a group of 15 banks. Hughes placed his stock in a ten-year voting trust controlled by the lenders, who named former Ford Motor Chairman Ernest Breech as a trustee. TWA was again without a president, former Navy Secretary Charles Thomas having resigned in a tiff with Hughes five months earlier. Breech began a desperate search for a man to lead TWA out of chaos.
The Dirty Trick. His eye soon lit on Tillinghast, then vice president for international operations of the Bendix Corp., Detroit-based maker of aviation, missile and auto components. Breech, as a former Bendix president, had been so impressed with Tillinghast's legal work for the firm that years earlier he had persuaded him to move to Detroit, where Tillinghast subsequently joined the company.