270 THE WEALTH AND POVERTY OF NATIONSLe Creusot: The Tales
That Business History Can TellIn the decades following the Peace of 1815, the French iron industry
entered the world of modern technology. Three factors were
decisive: (1) the backlog of technique waiting to be learned, in
particular, the adoption of coke smelting and coal-fueled puddling-
rolling, where France was more than half a century behind; (2)
improvements in transportation, which made it profitable to bring
coal to the iron ore or vice versa; and (3) a huge demand for
wrought iron as a result of railway construction.
These circumstances changed the opportunity of Le Creusot, the
enterprise that, largely owing to fortuitous natural advantages (coal
and iron ore in proximity) and royal support, initiated coke smelting
in France in the 1780s. But Le Creusot suffered from a variety of
handicaps, most seriously its poor access to iron-using markets.*
These, plus poor management and the perturbations of revolution
and war, had brought it low. In 1835, it lay fallow in bankruptcy
while much of its equipment rusted.
At this point a team of experienced technicians and merchants
pooled knowledge, money, and connections to buy up the debris of
earlier firms and relaunch the enterprise. The makeup of the team
says a lot about the needs of business and the character of the French
bourgeoisie.
The point men in the venture were the brothers Adolphe and
Eugène Schneider, merchants, bankers, technicians, and
forgemasters. Their father Antoine Schneider was a notary
(something like an English solicitor) and local notable in Lorraine. A
nephew was an early graduate of the Ecole Polytechnique and rose in
the army to become a general and for a brief period minister of
war—a useful career for cousins who would be making and selling
iron and steel.
Of the two brothers, Adolphe married Valerie Aignan,
stepdaughter of Louis Boigues, a wealthy Paris merchant specializing
in metallurgical products—again a most useful industrial connection.
* The town of Le Creusot is located in the region known as the Nivernais, 370 kilo-
meters south-southeast of Paris.