On Saint Patrick's Day, 1947, CAE, then known as Canadian Aviation Electronics Ltd., was founded by Mr. Ken Patrick, an ex-Royal Canadian Air Force (RCAF) officer. His goal was to "....create something Canadian and take advantage of a war-trained team that was extremely innovative and very technology-intensive." From the beginning, some of Canada's best known industrialists formed the company's board of directors. In 1951, Mr. R. Fraser Elliot joined the board and became its Chairman two years later.
In its infancy, the company was located in a vacant aircraft hangar at the Saint-Hubert Airport. Counting a workforce of 18, CAE started to repair and overhaul ground communication equipment and install Antenna Farms in the Arctic for the RCAF. Within two years CAE was firmly established in the Canadian radio industry.
CAE Western Division was established in Winnipeg to repair and overhaul telecommunications equipment and to develop and manufacture electronic instruments such as moisture meters for use in grain elevators, scintillometers (Geiger counters), proportional flow valves and radio receivers.
The company entered the simulator business with a contract from the RCAF to develop a CF 100 flight simulator. Having no prior experience in this lightly specialized field, the company signed a seven year licensing agreement with Curtis Wright Corporation of the United States as a back up source of technology. During the CF 100 project, CAE developed new techniques in generated radar targets and weapons systems scoring, which greatly improved simulator accuracy. The RCAF contract was extended, and by late 1957, ten additional units had been delivered, including the company's first export order to the Belgian Air Force.
The company focused its efforts on building Canada's largest group of technicians to support sales, installation, and maintenance of electronic devices. Systems Engineering Support (SES) and the repair and overhaul of the RCAF's MG-2s Airborne Radar/Fire Control systems were major activities at CAE. The MG-2 was expanded in the late 50s to a manufacturing science, which resulted in additional exports to Belgium.
CAE's calibration service to military bases was reputed throughout Canada and Europe. This field of work would later evolve into a series of mobile calibration laboratories, which would provide repair and overhaul services to RCAF and RCN electronic equipment throughout Canada. Their use in the field made it unnecessary to transport delicate and expensive equipment to a central point for periodic calibration. This service continued to be a regular part of CAE's business until the early 80s.
A new plant in the Montreal suburb of Saint-Laurent was established adjacent to Montreal's Dorval Airport, where 500 employees manufactured, modified or serviced everything from flight simulators to televisions, radios, hi-fidelity sets, radar equipment and SARAH, a search and rescue and homing system for the RCAF's nationwide rescue network.
CAE began designing what would become the first Canadian built commercial flight simulator, an analog DC 6B for Canadian Pacific Airlines (CPA).
Mr. J. F. Tooley was made president from 1957 to 1967. During this time he assessed the company's financial weak points and initiated a diversification program designed to focus the company's efforts on select product lines, making them more robust and less dependent on the defence electronics industry.
By the end of the 1950s, CAE's management decided that the development of specialized equipment and the manufacture of consumer goods did not mix. Consumer products were to be gradually phased-out.
Substantial efforts were poured into research and development programs leading to the company's debut in the data communication, digital simulation and Magnetic Anomaly Detection (MAD) equipment markets. The installation of SAGE, a warning system in Europe, led to future international contracts.
By the end of the decade, CAE was an established simulator company employing 750 people in a plant that had been expanded by four test bays for simulators and their components.