In two decades, Alfred Krupp turned a small steel company into a global corporation and the largest industrial company in Europe. He made Krupp the nation’s armourer. Its steel cannons contributed to victory in the Franco-Prussian War. By Peter Balsiger
Alfred Krupp came from a merchant dynasty. His father Friedrich Krupp had founded a cast steel factory in Essen in 1811. He wanted to produce a durable special steel that only the factories in Sheffield, England, had previously been able to produce. In 1818 he therefore bought a plot of land near Essen and erected a smelter with eight furnaces and a large factory building there.
Friedrich Krupp died in 1826. He was only 39 years old and left his heirs a company that employed seven people and had a debt of 10,000 thalers. His eldest son Alfried (he later called himself Alfred), who was to continue the business, was just 14 years old. The young entrepreneur grew into his role surprisingly quickly. He was ambitious, dogged, and constantly trying to improve the process of making cast steel. He advertised for customers at home and abroad and raised the capital to buy a steam engine. The breakthrough came with railway construction. Krupp had his workers forge springs, wagon axles and a shatterproof wheel tire without a weld.
Around 1850 railway companies ordered the first axles from him. The Cologne-Minden Railway ordered around 2,400 suspension springs, 400 shock springs and 325 axles. Even the trains of the American railroad companies used Krupp wheel tires. In the next ten years he increased his workforce sevenfold; the company brought in millions in profits.
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Krupp had long since opened up a new market: the armaments business. As early as 1851 he had presented a steel six-pounder gun at the World Exhibition in London. A revolutionary invention, because until then cannons were made of bronze or cast iron. In firing tests, the steel guns proved to be superior. The first major order came in 1859: Prussia ordered 300 cannon barrel blocks for the proud sum of 200,000 thalers. Krupp supplied cannons to all major European powers – with the exception of the “arch-enemy” France. The Krupp Empire became the nation’s armourer.
The Franco-Prussian War of 1870/71 was also decided by the superiority of Krupp’s steel cannons: Compared to the French muzzle-loading bronze cannons, the breech-loading field cannons had a higher rate of fire, up to ten rounds per minute, better accuracy and a larger shot Range. The devastating effect of these guns was particularly evident during the decisive battle of Sedan. Krupp was considered the “King of the Guns” and the “Baron of Steel”.
The entrepreneur now became the tycoon of a new economic age. The gigantic steel factories that he built gradually transformed the rural idyll of the Ruhr area into a gray industrial region. “Krupp can see his empire from afar, shrouded in a cloud of smoke and steam. More than 40 water towers and chimneys rise out of the haze, some of them taller than the church towers of Essen: the city that, like an appendage to the factory works,” wrote the “Spiegel”.
The entrepreneur needed more and more workers – they came from the Rhineland and Westphalia, later from East Prussia and Poland. Around 12,000 people worked in its factories in 1873. They toiled eleven hours a day, saw no daylight, risked their health and lives over glowing blast furnaces and steel blocks weighing tons. There were no longer enough apartments for them. In order to alleviate the housing shortage, Krupp had a dormitory built on the factory premises as early as 1856. And in 1863 – the number of Krupp’s workers had meanwhile increased sixfold – he had a complete nine-block settlement built.
A world of its own
A new era in the company’s history began with this residential colony: For Krupp, the company became a kind of community of life and destiny. The patriarch secured his workers with a company health insurance fund and a pension scheme. He built schools, a hospital, beer halls and libraries, and the workers could shop cheaply in the company’s own “consumer institution”. In return, he demanded loyalty, diligence and unconditional obedience from his “Kruppians”. He considered a say in the company to be a stupid, superfluous fashion. In the factory he wanted to “be and remain master”. Anyone who read a Social Democratic newspaper was immediately fired, as were workers who took part in demonstrations.
At the age of 41, Krupp met Bertha Eichhoff, who was 20 years his junior. He noted with surprise, “Where I thought I had a piece of cast steel sitting is a heart.” A month after the first meeting they got married. At first the family lived on the factory premises. Bertha and son Friedrich Alfred, born in 1854, a sickly child suffering from asthma, spent much of their time in Berlin and Italy. Bertha loved music and socializing – she found life in desolate Essen unbearable. In 1882 she left her husband. In the early 1970s, Alfred Krupp had a villa built on a hill south of the city of Essen – a magnificent building with 269 rooms and 8,100 square meters of living space. The “Villa Hügel” cost 5.7 million marks. That corresponds to around 35 million euros today. Krupp received its most important customers here. For example the Brazilian emperor, the Shah of Persia, the Egyptian viceroy, a Chinese marquis and princes and monarchs from Germany, Spain and Sweden.
In 1873 a recession gripped the continent. The prices for steel products fell, Krupp’s profits suddenly shrank to almost zero. The company fell into a financial crisis. For years no reserves had been formed, because the patron always invested in new machines, collieries or iron ore mines and took on 22 million marks in debt for this. Suddenly there was no money for ongoing operations and the repayment of loans. The company was saved in March 1874 by a consortium of several banks, which granted Krupp a loan of 30 million marks. Thanks to orders from abroad, profits rose again soon after the crisis.
In July 1887 the patriarch died of exhaustion and heart failure. The company remained in family hands. The 33-year-old Friedrich Alfred continued it successfully. He drove the company’s expansion, bought other steel companies or iron mines and developed new products. However, he was never able to fully step out of his father’s shadow.