In fiscal year 1923, the War Department awarded a contract to the Douglas Company of Santa Monica, California for the manufacture of two experimental observation planes under the designation XO-2. The first (23-1251) was to be powered by a 420 hp Liberty V-1650-1 water-cooled engine, whereas the second (23-1254) was to be powered by a 510 hp Packard 1A-1500 liquid-cooled engine. These two machines were to participate against contestants from other manufactures in a competition held at McCook Field for a successor to the aging DH-4Bs and DH-4Ms still serving with the Army Air Service.
Since the Army still had a large number of surplus Liberty engines left over from the First World War, the War Department ordered that the competitors in the observation plane contest fit their first entries with this engine. The trials were to begin in November of 1924. At the same time, the Army was fully aware that the supply of surplus Liberty engines would not last forever, and it scheduled a parallel competition for observation planes powered by the new 510 hp Packard 1A-1500 liquid-cooled engine. The second XO-2 was entered in this contest.
During the trials at McCook Field, two different sets of wings were tried out on the Liberty-powered XO-2--one with a span of 36 feet 3 inches and area of 370 square feet, the other with a span of 39 feet 8 inches, with an area of 411 square feet. The longer-span wings were found to provide better handling characteristics, lower landing speed, and higher ceiling, so they were adopted as standard. The Douglas XO-2 was judged superior to all other entrants in the Liberty-powered observation plane contest, and on February 25, 1925, a contract was issued for 75 aircraft. The Packard-powered XO-2 was less fortunate, and lost out to the Curtiss XO-1 in the parallel new-engine contest that was held in 1925.
The first 45 aircraft on the contract were delivered as O-2 (serials 25-335/379). They were powered by a 435 hp Liberty V-1650-1 engine. The O-2s were generally similar to the Liberty-powered XO-2 with long-span wings, but had a simplified engine installation with a large tunnel-type radiator mounted farther back underneath the propeller shaft.
The O-2 was a two-seat, open-cockpit biplane with a single bay of interplane struts. It was of fairly conventional construction, with a welded steel tube fuselage and wooden wings. A 30-US gallon fuel tank was located in the center section of each lower wing and could be jettisoned in an emergency. The undercarriage consisted of two oleo legs and two Vs hinged at the centerline of the underside of the fuselage. The standard armament consisted of one fuselage-mounted forward-firing 0.30-inch machine gun and one flexible 0.30-inch machine gun operated by the rear observer. Four wing racks were provided, which could carry bombs of up to 100 pounds in weight. An extra 0.30-inch machine gun could be installed over each lower wing. The rear cockpit could also be provided with photographic equipment.
The O-2 went on to become the precursor of a series of Douglas-built observation planes which became one of the most important types of American military aircraft during the 1920s and early 1930s. A few of the last related model, the O-38E and F, were still in service at the time of Pearl Harbor.
At the time of the awarding of the initial O-2 contract in February of 1925, the War Department had instructed Douglas to complete the last of the 46 O-2s (25-380) as a prototype for an attack aircraft. The aircraft was redesignated XA-2. It was powered by a 420 hp Liberty V-1410 twelve-cylinder inverted-vee air-cooled engine, which dispensed with the vulnerable cooling radiator underneath the nose. Its armament was quite heavy for the time--consisting of six forward-firing 0-30-inch machine guns, two in the upper engine cowling, two in the upper wings, and two in the lower wings. A pair of flexible 0.30-inch machine guns were mounted in the rear cockpit.
The XA-2 was completed in 1926, and was tested against the Curtiss XA-3. The competition was won by the Curtiss design, and no further A-2s were built.
Engine: One 420 hp Liberty V-1410 twelve-cylinder inverted-vee air-cooled
Performance: Maximum speed 128 mph. Initial climb rate 800 feet per
Dimensions: Wingspan 39 feet 8 inches, length 29 feet 7 inches.
Height 11 feet 0 inches, wing area 414 square feet.
Weights: 3179 pounds empty, 4745 pounds gross
Armament: Six forward-firing 0-30-inch machine guns, two in the upper
engine cowling, two in the upper wings, and two the lower wings. A
pair of flexible 0.30-inch machine guns were mounted in the rear