In 1941, with his brothers Edward and Eugene, he was involved with the organization and support of the 1st American Volunteer Group, popularly known as the Flying Tigers. The brothers established an assembly plant at Mingaladon airport outside Rangoon, Burma, where the AVG's Curtiss P-40 fighter aircraft were assembled, while an Intercontinent office in Rangoon (now Yangon) provided payroll and other housekeeping services to the group while it trained upcountry at Toungoo. Later, when Allied forces were driven out of lower Burma by the Japanese, the CAMCO factory and airfield across the border in Loiwing, China, served as a base for the AVG. When Loiwing in turn was captured by Japan in May 1942, Pawley moved his operation to India as a partner in Hindustan Aircraft Limited.