During 1932 and 1933 the US Navy ordered and tested three aircraft as part of an ultimately unsuccessful effort to find a scout amphibian as a replacement for the conventional floatplanes then serving aboard cruisers. In addition to adequate scouting range, the requirement specified that the aircraft be stressed for catapult launches and small enough, with wings folded, to fit within the confines of existing cruiser hangars. The Navy had previously experimented with the idea of adding fully amphibious floats to existing observation types, but the resulting weight penalty had degraded performance unacceptably. A designed-for-purpose amphibian, however, was viewed as a potentially better solution to the current problem of periodically re-rigging floatplanes to wheeled undercarriage, then back to floats again.
The Great Lakes entry, designated the XSG-1, was delivered to Naval Air Station Anacostia for trials in November 1932. Its design presented a curious two-story layout: two-bays of biplane wings resting on a main pontoon, with the engine and pilot being situated in a separate nacelle between the upper and lower wings. The gunner/observer’s position was located down in the pontoon aft of the wings. When, following brief trials, the XSG-1 failed to meet BuAer’s performance expectations, further development was cancelled.
After receiving a contract in 1932 to construct a single amphibian prototype, Loening proceeded to conceive a conventional biplane design that appeared to derive features from both its Navy OL-9 and the civilian K-85 Air Yacht. A rather odd-looking cockpit area resulted from glazed panels being placed around the interplane struts below the engine and wing center-section. By the time the XS2L-1 arrived at NAS Anacostia for official trials in February 1933, the Great Lakes entry had already been graded as unsatisfactory. Although the aircraft exhibited marginally better performance than its rival, it still did not compare favorably with existing cruiser-based floatplanes like the Vought O3U-3 and Berliner-Joyce OJ-2, and no production resulted.
Compared to his rivals, Sikorsky emerged with a remarkably modern aeronautical concept: a very streamlined two-step hull of all-metal semi-monocoque construction with monoplane wings that were raised above the spray in a gull configuration. The single Wasp engine, contained in a clean cowling-nacelle combination, was strut-mounted between the V of the wings. In stowed position, the wings folded back from the gull break to rest against the tail fin. The aircraft employed a Grumman-type amphibious landing gear and per specification, came with a tailhook to permit arrested landings aboard carriers. Sikorsky delivered the XSS-1 prototype to Anacostia sometime in 1933, and following modifications, was subsequently evaluated as the XSS-2. Though its range was similar to the XSG-1 and XS2L-1, the XSS-2 demonstrated itself to be 50 mph faster with a much better rate-of-climb. In the interval, however, the Navy had decided to abandon the small flying boat idea in favor of new types of cruiser-based floatplanes, and thus no production of the XSS-2 was ordered.