On 11 May 1940, the British prime minister, Winston Churchill, appointed the Canadian-born Lord Beaverbrook as his minister of aircraft production. Lord Beaverbrook immediately contacted the Canadian government to discuss the possibility of flying North American-manufactured planes across the Atlantic to bases in Britain. He assigned Morris Wilson, President of the Royal Bank of Canada, the task of organizing an Atlantic air ferry. Wilson contacted Sir Edward Beatty, President of the Canadian Pacific Railway (CPR), and informed him of Lord Beaverbrook's proposal.
By July 1940, Beatty had established the CPR Air Services Department to organize the proposed Atlantic air ferry program. Its first task would be to fly 50 twin-engine American Hudson bombers from California to northern England. A major obstacle was the American Neutrality Act, which did not allow the Americans to "fly" military aircraft to any nation at war. The United States government, however, formulated a clever solution to circumvent the provisions of the Neutrality Act.
The Hudsons were flown from California to North Dakota and landed just short of the American-Canadian border. The planes were towed across the border with private vehicles, and, from there, the pilots flew them to bases in eastern Canada. The highways that straddled the border served as runways. Technically, the American planes had not "flown" into Canada, and the Neutrality Act had not been violated.