I had written that the device proved secure in 1939-40 but in TICOM report I-78 Mettig (head of the Army’s codebreaking department for the period 1941-43) stated that it was read by July 40 (thanks to captured machines).
I’ve also added the following paragraph at the end of the essay:
Solution of the Hagelin C-36 at OKW/Chi:
The Hagelin C-36 cipher machine was not a secure device and it seems that in the 1930’s the codebreakers of OKW/Chi (codebreaking department of the Armed Forces High Command) developed methods of solving it.
According to the NSA report ‘Regierungs-Oberinspektor Fritz Menzer: Cryptographic Inventor Extraordinaire’, p21 in 1936 Fritz Menzer developed two methods for solving the C-36.
Also in TICOM report I-31, p7 dr Huttenhain (chief cryptanalyst of OKW/Chi) stated that the French C-36 type could be solved cryptanalytically (without the use of stereotyped beginnings).
Unfortunately, there is no information on the work they did on the C-36 during the late 1930’s and in 1940. Considering their statements on the security afforded by the device it is possible that at OKW/Chi some French Hagelin C-36 traffic was solved during that time.