Britain and Italy; The Strange Story of Britain's attempts to buy aeroplanes from Fascist Italy

Sometimes truth can be stranger than fiction. The story of how the RAF could have fought the Battle of Britain in Italian airplanes has been told in the past  but is possibly known only to a few aircraft enthusiasts. Iiii was last told a few years ago and probably deserves a new outing , with some added details. It almost reads like an Eric Ambler novel,  but it is all true – although it might have been embellished in some of the previous telling. Here from British and Italian sources is more or less the whole story. It neatly illustrates one of those lessons from negotiation skills courses, identify  the ultimate buyer , since if you do not get them onside  the negotiation is going to fail.  

Following the Munich Agreement in October 1938, the British embarked on a massive program of rearmament and modernization ready for war. This included plans to purchase planes abroad. The French needed their own planes, so this left the British with two potential sources of supply, the United States and former World War One ally, Italy. Since Mussolini had come to power relations between Britain and Italy had not also been at their best, especially since the Italian invasion of Abyssinia, However, British Prime Minister Neville Chamberlain had done his best to keep Italy from falling too far into the German camp and prided himself on his good relationship with Mussolini. In January 1939, the British began to sound out the Italians on the possibilities of a considerable arms purchase. Surprisingly these negotiations continued almost until the Italians declared war on Britain and France on 10 June 1940. 

Chamberlain and Foreign Secretary Lord Halifax visited Rome in January 1939, to talk to Mussolini. 1939.  The British did not go to Italy to negotiate anything in particular-, they had almost invited themselves- their main aim was to iron out a few remaining areas of contention and to talk to the Italians. After a long journey by train from Paris continuously interrupted by welcome greetings, the British finally arrived in Rome, in time for a 5.45pm meeting with Mussolini at the Palazzo Venezia. The other diplomats stayed outside while Chamberlain and Halifax were ushered into the Sala Mappamundo. According to his son -in-law and Foreign Minister, Count Ciano Mussolini was not impressed by his British guests.

 “These men are not made of the same stuff as the Francis Drakes and the other magnificent adventurers who created the empire. These after all, are the tired sons of a long line of rich men and they will lose their empire”.

 While in Rome, Chamberlain met the King of Italy , the British were taken to see a display of Fascist gymnastics, a celebration of Italian Minerals ,  the Opera and to various receptions. They met the Pope and met with Mussolini a couple of further times before departing. At least they had tried to make the Italians feel loved and wanted. 

In January 1939 the British needed planes and the Italians needed cash. Although the Italians had signed the Pact of Steel with Germany and Japan, the British remained hopeful that much as they had abandoned the Triple Alliance and come over to the Allied side in 1915, the Italians might eventually join the Allies against Germany. Despite , the mutual friendship between Hitler and Mussolini , the Italians remained fearful that the Third Reich now bordered them on the Brenner pass and of what their intentions were. The British and Italians had a mutual interest in doing a deal for armaments.  

One man stood to gain the most from putting the deal together and making it sure it did not collapse, Conte Caproni. In 1908, Caproni founded a factory in the Taliedo district of Milan, to  manufacture biplanes., the following year he opened an industrial airport near the Cascina Malpensa to manufacture and test his aircraft. In 1910, he designed and built his first powered aircraft, the Caproni Ca. 1, an experimental biplane which was the first aircraft built in Italy. It was destroyed during its first flight on May 27, the same year. In 1911, the year his company was named Società de Agostini e Caproni, and switched to monoplane construction, which was greater success. After Italy entered World War I in 1915, Caproni devoted his efforts to designing and constructing bombers. Following the war, Caproni was an early proponent of the development of passenger aircraft, and developed a variant of the Ca.4 bomber into the Ca.48 airliner. During  the Interwar period , he devoted most of his effort to the design and production of bombers and light transport aircraft, During this period, his company became Società Italiana Caproni, a major conglomerate which purchased other manufacturers, creating subsidiaries which included Caproni Bergamasca and Caproni Vizzola, purchased the Officine Reggiane, where it began aircraft production in the 1930and the Milanese automobile and engine manufacturer Isotta Fraschini. 

Conte Caproni

It is not clear who made the initial contacts between Caproni and the British. Caproni had a commercial office in London in Piccadilly , Caproni Agency Corporation (London)) Limited , the Chairman was Philip Grantham Yorke, the 9th Earl of Hardwicke., the Managing Director was a former Italian racing driver and wheeler dealer,  Edgardo Fronteras. Apparently born in Naples in 1899, he had served as an officer in the First World War. Sometime in the 1920s , Fronteras seems to have turned up in London. , claiming to be a racing driver with connections to the Maserati brothers. Records indicate that Fronteras did race cars in the UK at least for a short period. He is recorded as having participated at Brookland’s ,  the Tourist Trophy in Belfast and the Irish GP in Phoenix Park driving Alfa Romeo, Maserati or OM  as an independent. He never seems to have finished higher than 12th position and several times “Did Not Finish”. Despite his lack of success, Fronteras participation in the British Motor Racing scene probably gave him entry to a certain milieu and allowed him to further his British contacts. 

Some still remaining parts of the Caproni factory in Milan

In January 1939, Caproni sought permission from the Italian Air Ministry for a British delegation to visit the Caproni factory at Taliedo in Milan.  The Italians approved a British delegation of four for the visit consisting of Hardwicke , Francis Rennell Rodd, Wing commander J Casperi and Squadron Leader D’Atcheley. There are apparently no RAF records indicating Wing Commander Casperi ( or any close name) , D’Atcheley was probably Squadron Leader David Francis William D’Atcheley of the Air Staff. Apparently two other Britons were refused visas The British delegation visited Italy for two days specifically to investigate the Caproni’s plane the Ca. 310. 

The Caproni Ca. 310 which interested the British

In 1937 , the Chief of General Staff of the Italian Air Force, General Giuseppe Valle, had persuaded the main aeronautical companies, SIAI, Caproni, CRDA, Macchi, Breda and Piaggio, together with the Isotta-Fraschini and Alfa Romeo engine manufacturers to form a consortium to coordinate their activities to avoid internal competition . Consorzio Italiano Esportazioni Aeronautiche , which took care of publicity activities and initial contacts, delegating the management of the advanced stage of the negotiations and the finalization of the contracts to the individual companies. The final decision on whether to proceed with a contract rested with the Ministry of the Air Force, which also took  economic return of about 20% of the price increases of the material exported compared to that sold in Italy. Between 1937 and 1940, 1,645 aircraft were exported by the Italians compared to 280 in  the previous three years, but this  market success was short lived , and served to consolidate the tendency to keep existing planes in production rather than innovate. An increase in exports, could not compensate for the decrease in government orders, and the attempt to expand the production, without  technical and operational guidelines, only served to exacerbate a situation in which the bad quality products were accompanied by excessive variety and absence of mass production. Initially Italian export efforts were directed towards Europe, particularly towards Bulgaria and  Hungary, and to nascent Air Forces in South America, supported by the presence of influential Italian communities. Later export attempts concerned the Middle East, (Saudi Arabia and Iraq) and Afghanistan , exploiting a growing unease with British hegemony in the region, China  and later Japan. In the early 1930s, the Italians had developed particularly warm relations with the Nationalist Chinese Government , to the extent of creating a Sino- Italian aircraft assembly and manufacturing plant.   In view of the developing situation in Europe,  negotiations with Belgium ,France and Scandinavian counties commenced. On the downside , the  Consorzio Italiano Esportazioni Aeronautiche,  by putting all the plane manufacturers together prevented the identification of national "champions" with the greatest  chances of export success. Production quality often did not live up to expectations, and there was a lack of attention to logistical support or after sales service, two problems accentuated by the tendency to offer potential buyers types of aircraft that were outdated, if not even out of production or had not been adopted by the Regia Aeronautica. 

The ex Caproni Factory in Milan

There was a conflict of interest  between the Ministry of Foreign Affairs, who wanted  to strengthen the sphere of  Italian influence, and the Ministry of Exchanges and Currencies, who saw foreign sales mainly a source of hard currency.  The burden of export support ended up with the Ministry of Aeronautics, which was forced to give precedence to foreign orders over its own, to acquire the aircraft subject to non-finalized foreign orders and to bear the costs of the 15 military aeronautical export missions between 1933 and 1939. In this rather chaotic context, by the second half the 1930s, Caproni Companies represented 25% of the Italian domestic production of aircraft and 50% of the export market. There was intense competition in the Italian domestic market and Caproni was struggling to get orders from the Regia Aeronautica especially for the Ca. 310. The Italians made a small order of 16 planes sent to the Legione Aviazione fighting on the Nationalist side in the Spanish Civil War . Orders were also concluded with Yugoslavia, Hungary and Norway and Peru. The Norwegian contract was part of  a barter invoking salted codfish for planes. In any case the Norwegians weren’t happy with the first delivery and refused to take the rest of the order forcing Caproni to offer them instead the improved Ca. 312. Small orders in Eastern Europe or South America were one thing,  what Caproni really needed was big orders which meant the French or British Air Forces. The British had already had dealings with the Caproni Group. The British ship builder Vosper had purchased Isotta Fraschini engines for the use in its new Motor Torpedo Boat ( MTB) design the MTB1. They were now willing to talk to Caproni about aircraft as well. 

So in January 1939, the British delegation arrived  to visit the Caproni factory at Taliedo in Milan, specifically to investigate the Ca.310. The Ca. 310 “ Libeccio”. had performed well in the Raduno Sahariano in February 1938, an air race held in Libya, where the plane  had taken five out of the top six places in a grueling circuit of 3440 km from Ghades- Brak-Cufra -Bengasi-Tripoli. Although the British seemed very interested in the Ca.310 as a potential trainer matters then when quiet for several months.  

More of the Caproni factory

After the German invasion of Poland in 1939, the British discovered a sudden sense of urgency for the negotiations, but by then matters had become more complicated. The Italians were determined to stay out of the war and the British treated them as a neutral state, This was the source of a lot of bad feeling as the British attempted to prevent contraband reaching Germany through neutral states, involving the need to search Italian shipping in the Mediterranean , something that intensely irritated the Italians. Italy’s big problem was its lack of natural resources, especially coal and coal figured largely in discussions. Italian industry was cursed by the lack of domestic coal reserves, which included small deposits in Sardinia and Istria, Although, they had substantial hydro-electric resources , which allowed widespread and early rail electrification, industries like Iron and Steel needed coal. The two biggest coal exporters in Europe were Britain and Germany. In the  years before sanctions were introduced following Italy’s invasion of Abyssinia, the UK had supplied on an average over fifty  percent, by value of Italy's coal imports: By the time of  the so-called Easter Accords in 1938, when the British had basically ditched the Abyssinians and sought a rapprochement with Italy this had fallen to around 29 percent, the difference of course being picked up by Germany. .Italy’s coal imports from Germany came mainly by sea , of the eight million tons imported  from  Germany in 1937,  about two million  tons were sent by rail through Switzerland ,  four million tons were  shipped from Rotterdam,  and the remainder from  other  (mainly German) ports.

Following the outbreak of the war , Italy had to rely on ships flying neutral  flags for shipping the coal, which,  in view of the British plans  for chartering most excess  neutral  tonnage, would probably mean ships flying the Italian flag only, the Italians thus faced a great fear of their vital coal supplies being interrupted. British imports from Italy were mainly foodstuffs (fruits, fresh  and canned vegetables, cheese), artificial fibres and wool yarns (largely produced from imported raw materials), hemp, and sulphur. Germany also took a large percentage of most of these commodities: 37% of  citrus fruits ; 58% of  other fruits,  75% of hemp, 44% of silk, and 43% of nuts. In addition to coal, Germany supplied  Italy  with machinery (amounting in 1938 to 68% by  value of Italy's total  imports  ), 48% of wood  ,  iron  and 38% of  steel,  and  22% of chemical  wood-pulp  Of these German supplies  only  the  coal  could  conveniently  be supplied by the  Allies. Overall Italy relied  on  Germany  for  some  27% of  her imports against  14%  from  the Allies, while  Germany  took  19% of  Italian exports,  compared  with 14%,  taken by the  Allies. Although  the  Italians  maintained  secrecy  regarding  the  position  of the  German-Italian  clearing  account,  the  British Embassy learned  on good  authority  in  September  that  German  indebtedness  to  Italy amounted  to  nearly  2,000  million  lire  (approximately  £27  millions). Even if  this  figure was  exaggerated  Italy did not want further debts with Berlin.  

Sir Percy Loraine, His Britannic Majesty's Ambassador to Rome

 The  war began with Italy neither an all-out  friend  nor an  all-out  enemy of the British. The  line taken by the  British  Government  was based  on  the  Foreign  Office assumption,  which  the  War  Cabinet  accepted, that there was  potential that  Italy  could  be  induced to join the war on the  Allied side. Sir Percy Loraine summed up British policy: 

It was therefore the policy of His Majesty's Government, while fully safeguarding  their  belligerent  rights,  neither  to  seek  nor  to  provoke  a conflict  with  Italy,  and  to  use  all  honourable  means  of  amicable negotiation,  not  only  for  the  solution  of  such  difficulties  as  might arise,  but  also  for  the  adjustment  to  mutual  advantage  of  the  eco- nomic relations  between  the  two  countries  which  war  conditions were  bound  to  unsettle. 

Senator Amadeo Giannini, director-general of economic affairs at the Ministero degli Affari Esteri who was in London in September,  led the British to understand that  Mussolini  had  been  'beside  himself  with  rage'  at  Hitler's attack  on  Poland,  he had now  “done with Heir  Hitler  for good”, and that Italian policy was to keep  out of trouble and to trade as  much as possible with  England  and  France. Giannini  stated  that  Italy  expected  to  be  treated  'firmly  as a  neutral,  advised  against  too  much  official  negotiation  on  war trade  and  blockade  matters'  and  hinted  that  British  orders  for  purchases in  Italy  would  be  given  preference  over  German. 

The British were fortunate that in September 1939, a rather more forceful figure joined British Ministry of Economic Warfare and more or less took over trade relations with Italy, Francis Fennel Rodd. Rodd knew Italy well. He had spent some of his formative years in Rome, where from 1908 his father had  been British ambassador to Italy and had been instrumental in persuading the Italians to join the war on the Allied side in May 1915. Educated partly at Eton and partly during stays in Weimar and Geneva, by the time Rodd went up to  Balliol college, he was fluent in French, German and Italian. In the First World War he had served  with  the Royal Field Artillery on the Western Front before transferring to the British Military Mission in Italy in 1916. In 1917, the opportunity had arisen for an Italian interpreter to join a British mission to Libya and he had seized that opportunity. After this foray into the Libyan desert Rodd had served as a liaison officer with the -Italian Detachment in Palestine. Post-war Rodd had entered the Foreign Office and then the Bank of England. In the late 1920s, the Bank had sent him to Italy to sort out the collapse of the Banca Italo- Britannico during which time he had met Mussolini, He then worked as a partner in the Merchant Bank Morgan Grenfell.  Seconded to the Ministry of Economic Warfare at the start of the war, it  was natural that with his Italian background and language skills, Rodd would end up taking a prominent role in Italian matters. 

In September at a Foreign Office meeting Rodd representing the Ministry of Economic Warfare proposed that Britain should try and gain leverage over Italy through becoming its main supplier of coal. The plan was that Britain would purchase products like aircraft engines and spare parts from Italy and with the profits, the Italians would buy British Coal. The Chancellor of the Exchequer reported to the War Cabinet, that the Ministry of Supply would be able to make purchases of around £3 million from Italy ( including fuses, instruments, Sulphur, hides, machine tools an anti-aircraft equipment if was considered suitable ), the Ministry of Food was committed to purchasing around £690, 000 of lemons, The Admiralty was already contracted to purchasing the Isotta engines for the MTBs and the Air Ministry was having difficulty in formulating its requirements without knowing what the Italians had to offer. The Air Ministry favoured sending a technical mission to -Italy to investigate further, a view support by the Chancellor. In return the British would increase coal production to guarantee a supply to the Italians. Preferably although this was to be paid for through the Anglo- Italian clearing account. The policy was agreed at the War Cabinet on 8 September. Sir Percy Loraine recently appointed British Ambassador to Rome would work with Rodd in opening the negotiations. Other key players were to be Edward Playfair of HM Treasury and Richard Nosworthy, Commercial Counselor at the Embassy in Rome.

 In October , the British delegation went to  Rome and on 7 October, Rodd met with Giannini who was enthusiastic for the British plans. Rodd then spent ten days in Rome. It was somewhat of a homecoming for Rodd, whilst in Rome, he was able to say in the same wing of the British Embassy in Porta Pia that his family had lived in from 1908 onwards. On his return Rodd composed a Memorandum to the Foreign Secretary with his conclusions. 

“Any purchase we can make of war material from the Italians, especially from existing stocks , even if we do not really want them , would be worth doing in order to ensure ourselves against the possibility of Italy coming in on the side of Germany” 

Giannini suggested to Rodd the creation of an Anglo-Italian Standing Committee, to  deal with commercial questions. A draft agreement submitted by the Italians authorized the setting up of a  permanent Anglo-Italian Economic  Committee within  one  month. The committee would  consist  of  British  and  Italian government commissions having  power to co-opt  experts to supervise  the  working  of  existing  economic  agreements between  the countries  and  to adapt  them  to  existing circumstances. The committee's further  function  would  be  that  of 'adopting  whatever  measures  are  necessary  to  facilitate  and  improve maritime  and  railway  traffic  between  the  two  states  and in general  to adopt  all  measures  which  in  any  way  may  serve  to  improve  economic collaborationInitially Rodd chaired the commission , but given its importance  in December 1939, the Master of the Rolls, Sir Wilfred Greene was appointed permanent chair . A man of formidable intellect , Greene was a Barrister-at-Law, graduate from Christ Church, Oxford and a Captain  in the 2/1st Battalion, Oxfordshire and Buckinghamshire Light Infantry in the war, where had gained the Military Cross. He now began shuttle diplomacy between London and Rome. 

Edward Playfair from HM Treasury was given a key role in sorting out difficulties  over the Anglo-Italian clearing account. The coal sub-account was about six weeks  in  arrears  and  British  coal exporters were threatening to stop delivery of coal to Italy unless the clearing continued to  receive sufficient sterling,  which  had  decreased since the outbreak of war. An immediate  stoppage  was  only  avoided  when the  Export  Credits  Guarantee  Department  guaranteed  100  per  cent,  of  the  shipments  for  one  month  instead  of  the normal  seventy-five  per  cent. Worse the  Italians  were  asking  for  payment for purchases  then  being  negotiated  (e.g.  Isotta  engines)  to  be  made in  US dollars and  were  refusing  to  allow  payment  through  the  Clearing. The  difficulty  regarding  the  coal  situation  was  explained  to  Italy, who  agreed  on  26th  September  to  accept  payment  for  fifty  per  cent, of  the  engines  through  the  clearing,  but  demanded  the  remainder  in free sterling. To further complicate matters , the  French were already negotiating  the  purchase  of tanks,  wagons, locomotives, mercury, and  hemp in Italy. The  French  proposed that purchases  in  Italy  should take place  through the French Mission  in  London rather than  in  Rome,  to prevent separate negotiations by Britain and France  from turning into an auction. 

On his return to Britain, Rodd reported back favorably to the Foreign Secretary, Lord Halifax. Rodd was conscious that in all these negotiations, the British were treading a fine line on Italian  neutrality. If Italy were seen to side too much with the Allies it risked German reprisals, too far towards Germany and it risked Allied reprisals. It was therefore essential not to antagonize the Germans. Rodd also argued that the British press needed to start drawing a distinction between  Italian Fascism and German Nazism , just in case an agreement was reached with Italy. The British purchasing program developed slowly. 

On  12 October  the  British  were  asked  to  send experts to Rome at once to make  arrangements  for the purchase of  hemp.  Of  the 50,000  tons available  France wanted  20,000  tons  and  Germany  was  trying  to purchase  42,000  tons.  Italy  was  willing  to  sell  to  the  United  Kingdom and  was  studying  the  use  of  Italian  ships sent  for  coal  to  carry hemp.  An Italian  offer  of  the aircraft  material  was  also  conveyed  to the Air  Ministry  on  11  October. Unfortunately, the  hemp  experts  did  not  arrive  in Rome  until  30 October,  during  the delay  the Italians  were  persuaded  by  the  German  commercial  mission, headed  by  Dr. Clodius,  to  sell most of the hemp  surplus to Germany  instead.  On  22 October, Sir Percy Loraine was informed  of  the decision  of  the  War Cabinet to  send representatives  of  the Air Ministry  and  Ministry  of  Food  to  Rome  to negotiate purchases,  but  they had still not  arrived  by  7  November. The French  Government had  already concluded a contract for the purchase of aircraft,  and  other  contracts  were under discussion  for  the purchase  of  aircraft  by  the  Yugoslav,  Finnish,  and  Netherlands Governments. The British risked missing the opportunity of purchasing planes they much needed and were  losing  a  valuable bargaining  weapon  in  the  negotiations  over  contraband  control. The Italians were also getting irritated by the British slowness in investigating complaints about contraband procedures.

 If the British were represented by a collection of Eton and Oxford old boys, in Fascist Italy, the British found themselves dealing with some rather dubious interlocutors. Among them Raffaello Riccardi . president of the National Institute for Foreign Exchange and Commissioner of the Fascist National Institute for Foreign Trade. A war veteran, he joined the nascent Fascist movement, and had been  a prominent leader of the Fascist "squads “in the Marche implicated in the torture and murder of Communist activist Giuseppe Valenti.  Sentenced to four months and fifteen days in prison for the murder of Valenti, Riccardi was freed by an amnesty In 1939 he published a memoir Pagine Squadriste, in which he recalled numerous episodes of political violence of which he had been the protagonist, writing:

  "Violence is the midwife of the revolution, in whose hands the new order is born (...) The great ascensional parables that peoples build and launch beyond their own destiny are illuminated by the blood that generated them. I believe in violence; and to it I attribute thaumaturgical faculties. Violence is, in the political life of a people, what the crisis is in its economic life: the corrective par excellence”.

Riccardi’s political rise was accompanied by considerable enrichment, and at the beginning of the 1930s he was involved in a series of government inquiries into a number of enterprises in Pesaro, executives of these companies exploited them for the purpose of personal enrichment, in a dense network of abuses and irregularities. In November 1939, at Riccardi’s instigation  the Italians opened a Trade Office in London headed by Prospero Gianferrari : Gianferrari studied Engineering of the University of Padua and volunteered for the Alpine Arditi, during  WW1 in which he was wounded and captured. Between 1924 and 1929 he held various Fascist party roles , before in 1928 becoming managing director and general manager of Alfa Romeo[ and from 1933 to 1945 technical general manager of the Isotta Fraschini. From 1931 to 1945 he was also president of the Gruppo Costruttori Aeronautici Italiani. 

On 20 November the British finally advised the Italians in  writing  of  the  various  categories  and  quantities  of materials required. Since the activities of the French  purchasing  commission  in  Rome, were  concerning  the  Germans  it  was  decided  that  it  might  be  safer  to  continue  the  negotiations  through  Gianferrari  in London  and  the embassy  staff  in  Rome. Italy  was given an  assurance  that  the  British  Government would be prepared to spend in Italy  not  less  than  £20 million (exclusive  of  freights)  in the  twelve  months  to 31  December 1940.  An aide-memoire  was  handed  to  the Italian Foreign minister Count  Ciano  on  16 December outlining  the  British  proposals.  It  said  that  the  British  Government desired  to  place  large  orders with Italy,  but  as  the  conclusion of  individual  contracts  would  take  some  time  it  was  announcing its  general  plan  for  1940  so  the Italian  authorities  could forecast  the  purchases  they wanted   to  make  in  the  United  Kingdom and  the  Commonwealth  (excluding  Canada)  . This  was,  of  course,  on  condition  that  the  prices  were  reasonable; that  the  goods,  and  in  particular  the  manufactured  goods,  corresponded to  the  British  requirements;  and  that  the  dates  of  delivery were  acceptable.  The  aide-memoire  also  referred  to  Italian  coal  supplies.  Pending  the  conclusion of  arrangements  to  make  not  less  than  eight  million  tons  of British  coal  available  to  Italy,  Great  Britain  would  not  seize  sea-borne German  coal  exports to  Italy.  Ciano  did  not  raise  any  objection  to  the  proposal  and  with  regard  to  the  aide-memoire said  that  he  would submit  the  matter  to  Mussolini.  

Giangaleazzo Ciano, Mussolini's son in Law and Foreign minister

On 17 December, Ciano  told  Sir  Percy Loraine  that  he  had  shown  the  document  to  the Duce,  who  accepted it  as  a  basis for negotiation. As part of the overall trade deal , in December 1939, the Earl of Hardwicke informed Caproni that the British now intended to buy 200 Ca. 310s and 300 Ca,313s , even if the Ca313 was still in prototype form .The Earl returned to Italy with the long delayed Air Ministry mission, consisting of Wing Commander H N Thornton representing the Air Ministry , together with two test pilots Gray and Barnett . The latter was Squadron Leader Dennis Barnett of the RAF (his presence is confirmed in RAF records). This time the visit lasted two weeks, visiting the various Caproni plants to fly the Ca. 310 and Ca 311 .The were also interested in looking at the Re. 2000 fighter. 

The Re. 2000 was another plane, which Caproni had failed to sell to the Regia Aeronautica.  In 1938, the Ministero dell’ aeronautica in Rome launched Programme R, a comprehensive programme of  improvements, both qualitative and qualitative, throughout the force- including the adoption of new fighter. Several aircraft under consideration had already reached the prototype phase of development, only one aircraft, designated as the Re 2000 by Reggiane, was intentionally designed with the intention of competing for orders under Programme R.  Work commenced at Reggiane on the new fighter design in 1938; the company's design team, headed by Roberto Longhi and Antonio Alessio, set out to design an aircraft that would not only meet but exceed the requirements of Programme R. The company considered various options, including manufacturing an American-developed fighter aircraft under license, however, under the influence of Caproni, a completely new design was rapidly prepared. The design team were inspired by the American  fighter Seversky P-35, which Re.2000 superficially resembled; Refinement of the Re 2000's aerodynamic characteristics greatly benefitted from a series of wind tunnel tests held at the Caproni facility in Taliedo.

The resemblance to the Seversky P-35 might have been more than coincidental . Roberto Longhi had spent time in the United States working in the aircraft industry. A native of Bergamo , Longhi obtained his degree in mechanical engineering at the Milan Polytechnic. in 1926 he moved to the USA., working at the Bellanca Aircraft Corporation and then the  Curtiss-Wright Corporation where on aeronautical engines. He remained in the USA until  December 1935, when he took a leave of absence for health reasons and returned to Bergamo , accepting a position at the technical office of the Caproni Aeronautica Bergamasca directed by the engineer Cesare Pallavicino.  In April 1937, with his wife still living in New Jersey , Longhi resigned from Caproni and returned to the United States. . In July 1937 he suggested, to Caproni to purchase the production license for one of the two most advanced American fighters, the Curtiss P-36 Hawk or the Seversky P-35. In November 1937, engineer Antonio Alessio, deputy general manager of Reggiane, arrived in New York on the ocean liner Rex which was followed by Fidia Piattelli, deputy head of the Technical Studies Office and Caproni patents. They proposed that Longhi return to Italy and build a modern monoplane fighter aircraft entirely built in metal, guaranteeing him that he could form his own design office. There have been insinuations that there may have been some covert agreement with the Italians over the P35 . The Seversky aircraft corporation was struggling at the time and Seversky who , who held many of the innovative patents was removed from his position at the company after a controversial deal to sell P-35s to the Imperial Japanese Navy. In any case the Italians would have been able to access considerable technical information during their trip to the USA. Back in Italy again, Longhi  assumed the position of Head of Experimental Workshop at the Reggiane plant in Reggio Emilia and began working on the project of for the Reggiane Re.2000 . The problems immediately began, as both Dural and Alclad two light alloys used for the P-35, were not available in Italy, and a self-sufficient derivative called Chitonal had to be made, at the Montecatini factories. For the engine, they chose the  new Piaggio P.XI RC.40 which could deliver 1,000 hp. 

The Re.2000 which the British Royal Air Force was interested in buying

On 24 May 1939, the prototype Re 2000 made its maiden flight at Reggio Emilia, flown by Caproni test pilot Mario De Bernardi. A World War 1 fighter ace,  de Bernardi had raced seaplanes in international races winning the Schneider Trophy race at Hampton Roads in 1926 in a Macchi M.39 and setting a world record. In 1931, he became a consultant to Caproni and Chief Test Pilot. De Bernardi’s tests demonstrated the plane's favourable flying attitude, good speed and high manoeuvrability. Only minor modifications were required after the successful completion of the initial factory flight test programme; including changes to the exhaust, lengthening of the carburettor air intake, and the replacement of the round windshield with a framed counterpart. Following the completion of armament trials at Furbara, Santa Marinella, in August 1939, the prototype was delivered to the Experimental Establishment of the Regia Aeronautica at Guidonia Montecello to commence formal evaluation. During trials at Guidonia in late 1939, the prototype was able to attain a speed of 518 km/h at an altitude of 5,250m and demonstrated an 11,500 m altitude ceiling. Throughout the test flights, the aircraft showed excellent performance levels, on several occasions, demonstrating the ability to perform better than other fighters in production. In mock dogfights, it could successfully fight not only the slower Fiat CR 42 biplane, but even the more modern Macchi C 200 and Messerschmitt Bf 109E. However, an unfavourable technical report of the prototype was also produced by the Directorate of Aeronautical Construction of the Air Ministry criticising the integral fuel tanks within the wings as highly vulnerable and prone to leaks, as well as being difficult to manufacture. The negative conclusions of the technical report directly led to an initial order for 12 pre-production aircraft being cancelled. The Italian government authorised Reggiane to promote sales to international customers, the company decided to proceed with the production of the 188 fighters that had been cancelled as a private venture so that immediate delivery could be offered to foreign customers. A potential British order was an eyewatering opportunity. At the end of the British visit, Thornton told Conte Caproni that the Air Ministry would  proceed with an order, inviting representatives of Caproni to visit Britain to finalize the details.

More of the Re.2000

 During long negotiations, the British subsequently fixed on 100 Ca,311 and the same number of Ca,313s. On 26 January, the contract was approved by the British Air Ministry, with an order for 400 planes worth 26,375,000 dollars. The order was subject to satisfactory flight tests and Caproni agreeing to honour the supply of spare parts. The company had already sold 200 Ca313s to the French The British also expressed interest in purchasing 300 Reggiane Re2000 fighters from Caproni . A  Caproni delegation led by Fronteras went to Harrogate in Yorkshire (where the Air Ministry had temporarily relocated) for a series of meetings led again by Squadron Leader Neville Raby Buckle. 

Despite these positive signs, by the end of 1939 the only purchases which had been firmly concluded  were  the  Admiralty  purchase  of Isotta engines  and sulphur. and  mercury  purchases  by  the  Ministry  of Supply. The  Germans were still  competing  for  Italian hemp,  and  the Italians  wanted  assurance  of  compensating  supplies  of  jute from India  before  coming  to  terms  over  hemp  with  Great  Britain.  By  the beginning  of  January  1940  the  British  were  prepared to increase  the  offer  of  guaranteed  expenditure  on  purchases  in  Italy  to £25  million,  but  this  decision  had  not  yet  been  communicated  to  the Italians. On 18 January 1940, Squadron Leader Buckle travelled to Italy as a civilian with his passport showing him as civil engineer, to put together the fine details of the deal and to seek assurances that the contract would be honoured whatever position the Germans took.  He was also to study a way of getting the disassembled planes by rail across the border to Istres in France, where they could be reassembled and flown to Britain. Despite all the precautions, and the secrecy with which the negotiations between France, Britain and Italy were carried out, German intelligence found out and told their Italian counterparts. At that point the Ministero dell Aeronautica was forced to tell the Germans officially what was going on and asked whether they had any objection to the contracts being honoured. Initially the Germans did not object. 

Sir Wilfred Greene, the Master of the Rolls, who negotiated with the Italians

In January 1940, Sir Wilfred  Greene, went to Rome to carry on further negotiations The War cabinet noted ( CAB 65/5 19 January ) that “ our trade negotiations with the Italian Government had reached a difficult phase. The Master of the Rolls would arrive back in London later that day, and more information would then  be available.”  Sir Percy Loraine was advising that the situation arising out of these economic problems had now assumed a political aspect. The Italians were, in effect, asking for assurance in regard to the destinations of imports which we wished to control, and wanted to accept exports of vegetables and  fruit in exchange for coal. Sir Percy Loraine advised that, if we did not accept their proposals, the result might be a general quarrel, with a Press campaign against this country, to the advantage to Germany. So the British ended up agreeing to purchase the agricultural produce that they did not really want.   On 23 January , Greene returned to London and submitted his report on the position of trade negotiations with the Italian Government. He made it clear, in discussions with the Foreign Secretary and the Minister for Economic Warfare , that, in his view, the British ought to go some way further toward s meeting the Italian demands or risk  a considerable deterioration in relations with Italy . The  Cabinet's  decided that it  would  authorize  the  sale  of  coal  to  Italy  at  prices equivalent  to  those  paid  by  British  consumers  in  the  United  Kingdom. In  order  to  provide sterling  to  pay  for  this  coal  as  well  as  for  raw materials  from  the  sterling  areas  for  Italian  use,  it  was  prepared  to place  orders  for  the  goods  which  had  been  under  discussion  for  some months  past,  up  to  at  least  £20  million.  It  was  prepared  if  necessary to  purchase  in  addition  up  to  £5  million  worth  of  agricultural  produce, although  Greene  should  begin  by  offering  £3  million;  it would  not,  however  (in  deference  to  American  feelings),  buy  apples. All  these  purchasing  proposals  were,  however,  dependent  on  the supply  of  aircraft,  guns,  and  other  equipment  under discussion  since  November. So  the  whole  range  of  problems with Italy — contraband  control, purchases  and  sales,  coal,  shipping,  and  horticultural  purchases — was  covered  by  a  single  scheme.  The  financial  problem  was  also involved,  as  the  exchanges  contemplated  would  have  necessitated  a new  clearing  agreement. At some point , the British also added guns to their shopping list. These are referred to as Breda guns or sometimes more specifically as Breda 47mm guns. In 1926 , the industrial conglomerate Ernesto Breda S.p.A. set up a factory in Brescia for the manufacture of automatic defence weapons as the sixth section of the Società Italiana Ernesto Breda per Costruzioni Meccaniche. The Brescia plant employed up to 5800 workers. The Breda Cannone da 47/32 mod. 1935 was both an infantry gun and an anti-tank gun at which it was effective against light to medium armoured tanks. 

Loraine  delivered the British proposals in a  memorandum to Ciano on  3  February  who  received them favourably.  He seemed  anxious  for  a  settlement; and promised  to  send  the  memorandum to  Mussolini,  who  was  absent  from  Rome,  and  even  offered, if  necessary,  to  visit  the  Duce  by  air. Ciano realized  that  the  scheme must  be  taken  as  a  whole,  and  would  fall  through  unless  Italy  were willing  to  sell  Great  Britain  armaments  and  aircraft;  he  also  realized that,  if  the  agreement  failed,  German  shipments  of  coal  to  Italy  would be  stopped. After congratulating Caproni on the deal on 8 February  Mussolini almost immediately  reneged on it. It appears that the British might have overplayed their hand by requesting the purchase of guns Ciano told  Sir Percy Loraine  that Mussolini was not prepared to discuss the  question  of  the sale  of  weapons of  war to Great Britain for at  least  six  months.  The decision  was,  he  said,  due  to  fear  of “'misunderstandings” with  Germany' and  Italy's  own  need  of  modern  armaments.  Ciano now seemed resigned  to  the  imminent  stoppage  of  German  seaborne  coal exports  to  Italy;  he said  that Mussolini had had fair  warning.  He  admitted that the British contraband control  'was  being  operated  in  a  friendly  spirit  towards  Italy'. Strangely the  veto was said to refer only  to  Great  Britain  and not  to  France, and  there  were  mysterious  reports  from Rome  that  the  veto  would  be lifted  on  15 February.  This  coincided  with  the  date  on  which  the German  mission was expected  to  leave.  The  dismay  of  Giannini, Pietromarchi and  Masi  at  Mussolini's  rejection  of  the  scheme  also  led to  the  hope  that he  might  be  persuaded  to  reconsider  his decision.  His  failure to  bother  himself about  details  or  about  expert  opinion  made  it  more  or  less  clear  from the  start  that  his  decision  was due  to  political considerations  alone. The situation remained confused , on 12 February . the War Cabinet heard that  the Italians were unwilling to discuss the sale of arms to the UK and then from the Secretary of War that British tests of Italian planes in Italy were scheduled for that day. Pietromarchi revealed that  the  veto  on  the  sale  of  war  material  to  Britain included  all  aircraft,  bombs,  ammunition,  guns,  T.N.T.,  and  scientific instruments,  and also the Isotta  Fraschini  engines.  It  transpired  later that  Mussolini  had  been  under  the  impression  that  the  engines were  aircraft  engines,  and  he  subsequently withdrew  the  veto  on these.  When  the  embassy  completed  its  enquiries  as  to  which purchases  had  or  had  not  been  disallowed  ,  it  found that  the  permissible  purchases  under  negotiation  would  fall short  by between £6  and  £8 million of  the sum  required  by  Italy  to  cover  purchases  from  the  sterling  area. This  estimate  assumed  that  the Italians  would  be  allowed  to  purchase  the  8-3  million  tons  of  coal  at the preferential  price. The  sum  also  provided  for merchant shipbuilding  contracts  in  Italy,  which  might  not  materialize.  The net  result  was that  there  would  not  be  enough  sterling  to pay  for  even  5.3  million  tons  of  coal  already  contracted  for  and certainly  not for  he  8.3 million  tons  needed  by  Italy after  stoppage of  German  exports.  The  coal sub-account  would  thus  fall  into  still greater  arrears.  There was  genuine disappointment  among  the  (state-controlled)  suppliers  and  the  Italian Government  departments  at  Mussolini's  decision,  not  due  only to  economic  considerations. The  Italians  (not  excluding  Mussolini)  seem  to  have appreciated  the  candour  and  goodwill  with  which  the  British had conducted the  negotiations and  although  there  did  not  appear  at this  stage  any  positive  Italian  belief  in  a  German  victory,  fear  of Germany  was  obviously  a  dominating  factor,  with  the  additional consideration  (in  vetoing  the  armament  sales)  that  Italy  might  need the  armaments  herself.  This  point  was  of  particular  importance  in connection  with  the  Breda  guns, so short were the Italians of artillery that with the Spanish Civil War over , they had started asking the victorious Spanish Nationalists to give them some of their guns back. The aircraft were less problematic, having already been rejected by the Regia Aeronautica. 

The mixed messages continued. Sir Wilfred Greene returned to Rome and on 14 February reported that prospects were still good for the Trade Agreement, while on 16 February Sir Percy Loraine was telegraphing that there seemed to be no prospect of Mussolini withdrawing his veto. On 17 February the War Cabinet was told that the Trade Agreement had collapsed, although Greene was still convinced that leading Italian industrialists might still be able to sway matters in Britain’s favour. Things took an ominous term when the Von Ribbentrop suddenly tuned up in Rome at the beginning of March 1940.  Sources advised the British that the meetings had not gone to the German’s satisfaction and that Hitler had proposed a personal meeting with Mussolini, The War Cabinet was also receiving reports from the Ambassador to the Holy See that the Germans were now proposing to supply the Italians with coal overland through Austria ( and presumably Switzerland). On 19 March, Hitler and Mussolini met at the Brenner Pass and reports reaching London suggested that nothing had changed in the Anglo  Italian relationship as a result.  

Sir Percy Loraine remained optimistic thar things were still going well for the British in Italy and that there remained considerable pro-Allied sentiments, the Italians being well disposed to the British put fearing German strength.  With the most to lose financially , Caproni had not given up on his lucrative British deal , he was still talking to the British and Sir Percy thought that Mussolini might be persuaded to ratify the aircraft deal if the contract for the sale of guns was removed and that he had always felt less strongly about the sale of the aircraft. The French were also still trying to make arrangements with the Italians and on 22 March the War Cabinet heard that these were being supplied through a Portuguese Company Sociedad Aeroportuguesa . While the Italians were not accepting new contracts , they seemed willing to honour existing ones . It might still be possible for the Ministry of Supply to make purchases from Italy through this route. The plan was to disassemble the planes , crate them up and ship them by rail to France, where they would be reassembled and flown to Portugal as Civil aircraft. 

Sir Wilfred Greene returned to Rome  on 20  May, with Playfair  and  J.  W. Nicholls.  On 23  May  he issued a statement announcing an interim relaxation of the  contraband  control. The  British  had  received  an intimation  from  the  Italian  embassy  that  the  Italia  Line,  which  included almost  all  ships  trading  with  the  Americas,  had  given  instructions that goods for  which  navicerts  had  been refused were not to be loaded  in  the  company's  ships,  that  every  effort  should  be  made  to ensure  that  all  goods  loaded  would  be  covered  by  navicerts,  and  that any  goods  not  so  covered  by  the  time  the  ship  left  port  should  be  held back  on  arrival  in  Italy  while  information  about  them  was  telegraphed by  the  company's  agent  at  the  port  of  loading  and  considered in  London. Greene  informed  the  Italians  that,  in  the  confident expectation  that  all  other  shipping  lines  who  have  not  already  concluded agreements  will  agree  to  follow  suit,  instructions  had  been issued  that  for  the  time  being  Italian  ships  entering  the  Mediterranean would  not  be  stopped  except  for  identification,  and those  plying within the Mediterranean would  be  subject  to  identification but not diversion.  This  did  not,  however,  apply  to  ships  calling  voluntarily at  Allied  ports.  Signor  Alessandrini  had  already  been  appointed  by Italy  as  head  of  a  new  office  in  New  York  to  deal  with  applications for  navicerts.  Greene's announcement pleased  the  Italians,  who  declared it to  be  a  'great  step  forward',  but  that  it  'did  not  sufficiently clarify  the  situation  with  regard  to  cargoes'.  Pietromarchi  complained about  the  working  of  the  navicert  system  and  wished  to  modify  the arrangement  made  by  the  Italia  Line,  which  was  only  an  emergency measure.  He  then  asserted  that  the  arrangement  had  been  made under  a  mistake.

Hugh Dalton, the British Minister for Economic Warfare

Meanwhile , following the British and French failure to prevent the German occupation of Norway, Winston Churchill had become Prime Minister and he appointed the Labor politician Hugh Dalton as Minister of Economic Warfare, so Dalton inherited responsibility for the Blockade and the ongoing negotiations with the Italians. Dalton had fought alongside the Italians with a British Artillery Battery in the Great War, he spoke Italian and had even back in 1932, met Mussolini. Dalton was by no means convinced on the former policy towards Italy, He started to wonder why the Trade Deal had broken down in February. He did not buy into the story about the whole dealing collapsing because of Mussolini’s passion for the Breda guns. Subsequently he says that Sir Percy Loraine told him that the reason was that as far back as February, Mussolini had refused to betray his German ally and that was that. Loraine also blamed the lack of Foreign Office Control over the various British ministries party to the arrangement. 

Greene persevered with the Italians throughout May, but by then time was running out. Progress was not helped by Ciano’s disappearance on a trip to Albania between 22nd and 25th, where the Italians were stirring up Albanian nationalists to intervene in Kosovo. Apparently he was touched by the Albanians gratitude to the Italians for teaching them to have two meals a day and that the population was looking a lot better fed in those days. While Greene was still Rome, a substantial Japanese Trade Delegation arrived in Rome, to cement as deal which had stated with an Italian Trade delegation to Italy in 1938. The Japanese had given effusive welcome in Rome by Ciano, where they met the King-Emperor, Mussolini and the Pope. Thanks to the Italians recognising their puppet regime in Manchukuo, the Japanese were some of the few to recognise the Italian King as also Emperor of Ethiopia. On 30 March 1940, the Italians had endeared themselves further to the Japanese by recognising the Reorganised National Government of China in Nanjing. Even the Germans had not done that . As mentioned above , the Italians had previously had particularly warm relations with the Nationalist Government of China, who had by then been firmly ditched. The former Italian Allies Britain and France might have swapped notes with the Chinese.  On 30 May, the Italians ceased all negotiations with the British. Ciano  informed  the ambassador  that  "the  two  young  gentlemen  from  London ( Nicholls and Playfair)  could  go  home  as  soon  as  they wished,  as “ Signor  Mussolini  had  no  intention  of  concluding any  further  agreements  with His  Majesty's  Government",  Playfair and  Nichols went  to  make  their  farewells  to  Giannini, Masi,  and   Pietromarchi.  who seemed convinced  that the breaking off of negotiations was on H.M.G’s instructions. They seemed surprised  and  genuinely  upset  than  they  were  told  that really it was the reverse. What few apart from Ciano, were party too was that on the same day, Mussolini had communicated to Hitler that the Italians would enter the war on 5 June ( it was later postponed to the 10th)

In London, Hugh Dalton summoned the Italian Ambassador, Bastianini  to the Ministry of Economic Warfare to ask him what was going on. According to Dalton, Bastianini appeared stunned that negotiations had broken down. He had thought he was being summoned to be congratulated on their successful conclusion.  In Dalton’s view, Bastianini was either a very good actor or had not a clue what was going on in Rome. It was possibly the latter since Mussolini and Ciano were playing pretty tight on their discussions with Hitler. On 2 June, Dalton started to get firm. Ships with war materiel were heading for Italy, either for the Italians or to go to Germany, by that time it did not really matter. Hoe ordered them stopped/ . The pretence of Contraband Control was no longer necessary. The Cabinet agreed however, Lord Halifax and the Foreign Office still equivocated. Halifax and Sir Wilfred Greene who by now was back in London, argued that stopping the Italy bound ships was unwise. Dalton’s separate legal opinion argued that stopping the ships was not an “act of war” but a reasonable measure “falling short of war” . Meanwhile four days had been lost and the ships were getting closer. The legal debate continued until on the morning of the 10th June , the British Attorney General . Lord Somervell of Harrow opined that if His Majesty’s Government expressed the view that Italy was likely to enter the war, ships carrying contraband could be treated as if Italy was already at war . At 4.45 in the afternoon in Rome, it all became academic when Ciano summoned Sir Percy Loraine to tell him that from midnight Italy would be at war with Britain and France. When the Italians declared war on France and the United Kingdom on 10 June , there was no  longer any hope of pursuing even a covert deal through Portugal. 

Of the 300, Re 2000 that the British would have purchased, the Italians managed to sell 60 to Sweden and 70 to Hungary, with a licence to produce 200 .Of the order for Ca.311/313 a mere five were delivered to France before hostilities started, another for 84 were delivered to Sweden. For both countries the purchase may have been more out of desperation than anything else, the Germans were convinced that the Hungarians were more like to use any  planes against another German ally Romania and were refusing to sell them any, while the neutral Swedes had yet to develop their own aircraft industry and were in need of some air defence. 

The British never got their Italian planes and Caproni never got his 26 million dollar order. Throughout the process, the British negotiators had failed to identify their actual buyer or decision maker. During the negotiations, they received information through the filters of Caproni , businessmen and officials with their own agendas. Caproni wanted to sell planes, the Government officials wanted foreign exchange to buy coal, or a more benign contraband regime. Ciano acted as a filter to Mussolini, putting his own spin on the proceedings. The Italian officials who negotiated were probably acting in good faith, in the dark about Mussolini’s real plan. Ciano has less excuse, he was so close to Mussolini’s intention to go to war, even if he had convinced himself otherwise.  Regardless of what everybody said, Mussolini as the ultimate decision maker was committed to sticking with the Germans and when he made his mind up in February the whole deal was destined to fall apart. Dalton probably called it right that the Italians had been leading the British on , if not from the start but certainly for the last few months. In the end, the British side had its own problems , the Foreign Office Agenda was to keep Italy out of the war, the Air ministry needed planes, the Board of Trade wanted to sell coal and but food, the Ministry of Economic Warfare wanted to control contraband. Maybe there were just too many actors with different goals putting all their faith in one deal, that was almost certain to fail. 

Perhaps it was all for the best, the Italian planes did not perform particularly well and the Italia entry into the war would have meant no spare parts or after sales service. Although the Hungarians used their Re2000s to quite good effect against the Soviets, they seemed to suffer a lot of technical problems and may of them seemed to have required extensive refitting and rebuilding before they could be used. Apparently the problem with the fuel tanks was never really resolved and many flew around leaking fuel. In the end the Germans gave them German aircraft instead. The British got Breda guns in the end, they captured large quantities in the Western Desert, which they and the Australians went on to use elsewhere. 

On the upside when it came to bombing Italy later in the war, the RAF had pretty good knowledge of the location of all of Caproni’s factories, so those visits must have come in handy.