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The first aeroplane flight in Victoria was made in a Voisin biplane by US escapologist Harry Houdini at Diggers Rest in March 1910. In July that year, Australian John Duigan flew a biplane of his own design at Mia Mia (near Heathcote), and in November Frenchman Gaston Cugnet demonstrated a Bleriot monoplane at Altona, crashing during a further attempt at the Melbourne Cricket Ground three weeks later. In 1914, another Frenchman, Maurice Guillaux, flew a Bleriot carrying a bag of 'aerial mail' from Melbourne to Sydney in a series of short hops. Later the same year, a military flying school was founded at Point Cook to train pilots for the Australian Flying Corps. The location of the RAAF's No 1 Flying Training School over many years, RAAF Point Cook is regarded as the birthplace of Australian aviation.

The first flight from England to Australia reached Melbourne on 25 February 1920. The aircraft was a Vickers Vimy, piloted by brothers Sir Ross and Sir Keith Smith. Melbourne's Flemington racecourse was the finishing line for the 1934 Centenary Air Race from England to Australia, sponsored by Melbourne confectioner Sir MacPherson Robertson. With 64 international starters, the race was won by C.W.A. Scott and T.C. Black in a De Havilland DH-88 Comet in front of 40 000 spectators.

Essendon Airport has been a hub for commercial aviation since 1930. Despite early accidents, air services grew and in 1936 Holyman Airways took delivery of Australia's first modern all-metal airliner, a Douglas DC-2. Soon afterwards, this company merged with Adelaide Airways to form the Melbourne-based Australian National Airways (ANA), Australia's major private enterprise airline until 1957.

It was also in 1936, when coach operator R.M. Ansett proposed a road service between Hamilton and Melbourne, that Victorian legislation prevented his competition with the State railways. Ansett responded by opening an air service between the two centres. A year later Ansett Airways became a public company, with Lockheed 10s flying daily services between Melbourne, Riverina centres, Adelaide and Sydney.

With high-speed aircraft servicing Australia's air routes, there was concern over the lack of navigation facilities and the risks being taken in poor weather. In 1938 ANA's DC-2, Kyeema, plunged into the top of cloud-enshrouded Mount Dandenong, taking 18 lives. Following an inquiry, a long-awaited radio navigation system was implemented, a new Commonwealth Department of Civil Aviation created with headquarters in Melbourne, and a flight-checking system introduced that was later to evolve into Australia's air traffic control network.

The war years 1939-45 stimulated the development of aviation. At Fishermans Bend, the Commonwealth Aircraft Corporation's manufacturing facility was augmented by a new factory for the Department of Aircraft Production, which consolidated Melbourne as the aviation capital of Australia.

In 1945, the Commonwealth legislated to nationalise interstate air services. But after ANA won an appeal to the High Court, the government formed its own airline, Trans-Australia Airlines (TAA), in 1946. Competition between the two major operators became fierce, but with ANA disadvantaged by unsuitable aircraft, its finances became uncertain. Melbourne-based Ansett Transport Industries took over ANA in 1957. A year later the Commonwealth's Airlines Equipment Act ensured a workable two-airline policy, TAA (later Australian Airlines) and Ansett offering parallel services. Not until the early 1980s did a more competitive two-airline situation emerge. After the absorption of Australian Airlines into Qantas in 1992, the administration and engineering facilities of the former TAA/Australian Airlines were relocated to Sydney. With the financial collapse of the entire Ansett organisation in late 2001, Ansett's engineering base at Melbourne Airport ceased to function.

In 1973 the Department of Civil Aviation was merged with the Department of Shipping and Transport to become the Department of Transport, but in 1982 a new Department of Aviation was again formed. This Department's responsibilities have since been assumed by government-owned enterprises in Canberra: the Federal Airports Authority, Air Services Australia, the Civil Aviation Safety Authority, and the Bureau of Air Safety Investigation.

Melbourne's most significant postwar aviation development has been its international airport at Tullamarine. Opened in 1970, Melbourne Airport provides passenger, freight and engineering facilities for an increasing amount of domestic and international traffic. Melbourne's general aviation industry is also well served, with 10 light aircraft airfields and heliports around the outskirts of the metropolitan area, of which Essendon and Moorabbin airports remain the principal ones.

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