The Japanese continued their efforts to destroy the CATF with more attacks on July 31, mixing night bombing with daylight fighter sweeps. The badly outnumbered CATF P-40 pilots shot down 17 Japanese bombers and fighters, losing three P-40s in combat. The Japanese dispatched 30 Ki.43s on August 5, in yet another effort to smash Hengyang. They were intercepted by eight P-40s led by Alison. During the ensuing dogfight, CATF pilots downed four Oscars, losing one P-40, flown by Lieutenant Lee Minor–the first USAAF pilot killed in China.

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Following the August 5 raid, the Japanese, stung by their losses, broke off the attacks. Taking advantage of Japanese inactivity, Chennault sent his B-25 bombers and P-40 fighters on attacks from Lashio, Burma, to Hankow, China. They destroyed Japanese supply dumps, docks, airfields, ships and other vital targets. 'We never had to sit on the defensive and worry,' Scott recalled. 'We liked it.'

Major Rector led three P-40s of his 76th Squadron on an August 12 mission to escort six B-25s in an attack on Haiphong, in northern Indochina. The B-25s bombed the docks, setting fire to huge coal piles awaiting shipment to Japan. Rector's three P-40s, each carrying a 500-pound bomb, dive-bombed the Haiphong wharves after the bombers finished their run. All aircraft returned safely to Kwelin.

The CATF's bombers and fighters had launched 50 attacks against Japanese targets during July and August, and had beaten back several waves of Japanese fighters, losing only four P-40s. The unit's supplies of fuel, spare parts, bombs and ammunition were badly drained, however, and only a trickle of supplies was coming over the Himalayan mountains into China.

After mounting an unsuccessful strike into eastern China in early September, Chennault reluctantly pulled Rector's 76th Squadron, Hill's 75th Squadron and Alison's 16th Squadron back to Kunming. There, they would be closer to the supplies coming over the Hump and could rest and refit. By then, the CATF had only 34 flyable P-40s for 38 pilots, with a two-day gasoline supply. 'The China Air Task Force,' Chennault wrote, 'unbeaten in combat, was facing death from acute starvation.'

Supplies from the Hump airlift began to accumulate in the CATF's depots in late September. Reinforcements of both men and aircraft also arrived–more B-25s for the 11th Bombardment Squadron and P-40K Warhawks for the 23rd Fighter Group.

The CATF also got 20 fighter pilots from the 6th Fighter Command in Panama. The 'Panama pilots' had considerable experience in navigation, gunnery, formation flying and divebombing–which was not always the case with the replacement Army pilots. Many Army pilots sent to the CATF had no experience in navigation, formation flying or air gunnery, and had not flown a P-40 before coming to China. 'Green pilots were a double liability,' Chennault said. 'We had neither the time, gas, or planes to spend training them in China.' The greenest pilots were concentrated in Major Schiel's 74th Squadron, which was at the CATF's operational training school, at Kunming.

Flying accidents soon weeded out the worst pilots, and the summer's fighting turned the rest into veterans. With the arrival of the Panama pilots, the CATF'smacked less of a primary training school and more of a combat group,' Chennault wrote. 'The Japanese soon felt the difference.'

The monsoon season ended in early October, and the CATF detected signs that the Japanese were moving bomber squadrons into Burma for attacks against the Hump bases in India. There were also signs of a renewed ground offensive on the Salween River, where the AVG had repelled a Japanese offensive in May 1942. On October 3, Chennault radioed an urgent warning to Bissell in Delhi: 'Possibility enemy air attack on Dijan [and] other bases supporting ferry route in India…Kunming and western Yunnan bases as well as ferry route itself in making….'

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