Incorporated in 1933, McDonnell began life as a component manufacturer for Curtiss-Wright. In 1934, it entered a "strategic partnership" with the British Hawker Company. The first fruit of this alliance, the Kestrel, was built in St. Louis, Missouri, and entered service in 1936. McDonnell opened a second plant in Memphis, Tennessee in 1937, exploiting Appalachia’s lower wage base.

McDonnell is currently embroiled in a series of bitter legal battles with the ISA’s General Motors company. GM claims that McDonnell violated numerous patents and stole key design elements when they employed ex-General Motors designer, John-Paul Astin. Fortunately for McDonnell, GM has fallen afoul of the Confederacy’s byzantine legal system, which protects Dixie companies against outside threats. Escalating costs may yet force GM to abandon the suit.