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Published online by Cambridge University Press: 17 January 2025
The repeated proliferation of restraints to competition should not overshadow the agency of downstream firms when confronted with the ability of cartels to challenge the established innovation strategies of their consumers. This article explores the relations between Renault and the aluminium cartels during the first half of the twentieth century, in peace and war. Strategies were similar on both sides: the creation and maintenance of a balance of power, compromise, and the reopening of competition. Yet, when the cartel set up an automotive department and then rallied to the idea of a people’s car, it attracted the interest of broader stakeholders—engineers, other suppliers, the government, and even trade unions—but failed to persuade carmakers. Large industrial consumers can limit the impact of cartels, and destabilize them, by resorting to vertical integration. However, their underlying aim is not necessarily to destroy the cartel but rather to obtain better terms for their own business. Ultimately, their market power enables them to achieve relative stability. Who derives the main benefits from these compromises, both vertically and horizontally, as they sometimes limit or extend the scope of action of both parties?
A first draft of this paper was presented on 9 Sep. 2021 during a session on aluminium cartels at the Nagoya World Congress of Business History (online). Many thanks to discussant Margaret C. Levenstein (University of Michigan) for her comments and suggestions. A second draft, in French, was made available to the members of a French society of automotive collectors. This third draft has been fully revised and expanded.
1 This article will retain the UK-English spelling for aluminum—aluminium—for consistency, except for in direct quotes.
2 Margaret C. Levenstein, “Price Wars and the Stability of Collusion: A Study of the Pre-World War I Bromine Industry,” Journal of Industrial Economics 45, no. 2 (June 1997): 117–137.
3 Margaret Levenstein and Stephen W. Salant, eds., Cartels (Cheltenham, 2007); Martin Shanahan and Susanna Fellman, eds., A History of Business Cartels: International Politics, National Policies and Anti-competitive Behaviour (New York, 2022). Also see Knut Sogner’s review of Shanahan and Fellman’s edited book in Business History Review 97, no. 3 (Autumn 2023): 691–693. For a partly different perspective, see Liane Hewitt, “Monopoly Menace: The Rise and Fall of Cartel Capitalism in Western Europe, 1918–1957” (Ph.D. diss., Princeton University, 2023).
4 Espen Storli, “Cartel Theory and Cartel Practice: The Case of the International Aluminum Cartels, 1901–1940,” Business History Review 88, no. 3 (Autumn 2014): 445–467.
5 Marco Bertilorenzi, The International Aluminium Cartel: The Business and Politics of a Cooperative Industrial Institution (1886–1978) (New York, 2016), ii.
6 Archives of Rio Tinto France, Pechiney Historical Collection, Création et vie de L’Aluminium français, Box 500.1.17771. I would like to thank Ivan Grinberg, former general secretary of IHA. I published two of these documents in my short article, Patrick Fridenson “Aucune industrie ne peut être fermée,” Cahiers d’histoire de l’aluminium, no. 56–57 (Dec. 2016): 79–83. Also see Florence Hachez-Leroy, L’Aluminium français. L’invention d’un marché, 1911–1983 (Paris, 1999), 145 and 327 (using SEMF archives, now available at the Archives nationales du monde du travail, Roubaix).
7 Bertilorenzi, The International Aluminium Cartel, 48–100.
8 Karl Erich Born, Internationale Kartellierung einer neuen Industrie: Die Aluminium-Association 1901–1915 (Stuttgart, 1994).
9 Hachez-Leroy, L’Aluminium français.
10 Also for North America, see George D. Smith, From Monopoly to Competition: The Transformation of Alcoa, 1888–1986 (Cambridge, UK, 1988); Margaret B. W. Graham and Bettye H. Pruitt, R&D for Industry: A Century of Technical Research at Alcoa (Cambridge, UK, 1990).
11 Sylvain Jacob, “1895: première application de l’aluminium dans l’automobile: le carter inférieur du moteur de Dion-Bouton,” Cahiers d’histoire de l’aluminium, nos. 56–57 (Dec. 2016): 94–95. For context, see James M. Laux, In First Gear: The French Automobile Industry to 1914 (Liverpool, 1976).
12 Jean Boulogne (pseudonym of Emmanuel Pouvreau), La vie de Louis Renault (Paris, 1931), 90.
13 Ernest Fuchs, Louis Renault, booklet privately printed by the Renault Company, 1935, 18–19, Archives of Renault Histoire Association.
14 Patrick Fridenson, Histoire des usines Renault, vol. I: Naissance de la grande entreprise 1898–1939, rev. ed. (Paris, 1998), 93 and 102.
15 Philippe Mioche, “L’industrie de l’aluminium dans la Première Guerre,” in L’industrie dans la Grande Guerre, eds. Patrick Fridenson and Pascal Griset (Paris, 2018), 357–379.
16 For Thyssen, see Jeffrey R. Fear, Organizing Control: August Thyssen and the Construction of German Corporate Management (Cambridge, MA, 2005), 290. Christian Marx, “Enteignung-Entschädigung-Expansion. Der Versailler Vertrag und die Gutehoffnungshütte (1918–1923),” in 1919—Der Versailler Vertrag und die deutschen Unternehmen, eds. Dieter Ziegler and Jan-Ottmar Hesse (Berlin, 2022), 140. For a brief overview of Renault’s strategy, see Patrick Fridenson, “Renault et la sidérurgie,” in Dictionnaire historique de la sidérurgie française, eds. Philippe Mioche, Eric Godelier, Ivan Kharaba, and Pascal Raggi (Aix-en-Provence, 2022), 617–620.
17 Jacques Level, Note sur une entrevue de M. Level et de M. Duc, 21 Aug. 1919, Archives Rio Tinto France.
18 Gilbert Hatry, Louis Renault patron absolu (Paris, 1982), 111.
19 Jacques Level, Note sur une entrevue de M. Level et de M. Duc, 21 Aug. 1919, Archives Rio Tinto France.
20 Public engineers in France are always characterized by the name of the state schools where they were educated. Cecil O. Smith Jr., “The Longest Run: Public Engineers and Planning in France,” American Historical Review, 95, no. 3 (1990): 657–692.
21 “Level (Jacques),” Patrons de France, 2009, accessed 13 Nov. 2024, http://www.patronsdefrance.fr, and Ludovic Cailluet, Stratégies, structures d’organisation et pratiques de gestion de Pechiney des années 1880 à 1971 (Ph.D. thesis, Université Lyon II, 1995), 134–136. Also see “Duc (Émile),” in Notices biographiques Renault, ed. Gilbert Hatry, vol. I, Paris, Éditions JCM, 1990, 44.
22 Jacques Level, Note sur une entrevue de M. Level et de M. Duc, 21 Aug. 1919, Rio Tinto France Archives.
23 Jacques Level, second note on the Renault case, 22 Aug. 2019, Rio Tinto France Archives.
24 On Jean Sejournet and his father, see Ludovic Cailluet, Stratégies, 81, 109, 128; Jacques Sejournet, “La gestion héroïque. Souvenirs du temps du père Renault,” Gérer et Comprendre, no. 7, June 1987, 47 and 49; Hachez-Leroy, L’Aluminium Français, 120 and 145. For the father, Paul, see “Jean Adolphe Paul Marie Sejournet (1855–1942),” Annales des Mines, accessed 13 Nov. 2024, http://www.annales.org/archives/x/sejournet.html.
25 Draft letter from Louis Renault to Aluminium français, submitted by Aluminium français to the cartel on 17 Dec. 1925, Rio Tinto France Archives. See also Michel Roux, “L’usine du Temple: le plus ancien atelier décentralisé des usines Renault,” De Renault Frères, no. 30, June 1985, 211–212. Alais became Alès by decision of the municipal council in 1926.
26 Text reproduced in extenso in Fridenson, “Aucune industrie ne peut être fermée,” 81–83.
27 Minutes of the board of directors of L’Aluminium français, 1 Feb. 1921, 073.4.10030, Rio Tinto France Archives.
28 Draft letter from Louis Renault to L’Aluminium français, submitted by L’Aluminium français to the cartel on 17 Dec. 1925, Rio Tinto France Archives.
29 Poster of the national survey of the popular car, reproduced online by the Conservatoire National des Arts et Métiers, Michelin Museum, accessed 30 March 2023, https://ateliercst.hypotheses.org/3624; Louis Baudry de Saunier, “Causerie sur le Salon de 1923,” L’Illustration, 81, 6 Oct. 1923, 306–308; from Michelin Museum, Clermont-Ferrand, Fernand Gillet, Cent ans d’industrie: histoire anecdotique de la Maison Michelin, c. 1932, vol. 2, 127; Stephen L. Harp, Marketing Michelin. Advertising & Cultural Identity in Twentieth-Century France (Baltimore, 2001), 217–218, 326.
30 Letter from Louis Renault to Jacques Level, 19 Dec. 1925, Rio Tinto France Archives.
31 Bertilorenzi, The International Aluminium Cartel, 136–140.
32 Cailluet, Stratégies, 193.
33 Jean Bally, “Une grande perte. La mort de M. Jacques Level,” Revue de l’aluminium et de ses applications, no. 108 (Feb. 1939): 1544–1545.
34 Letter from Emile Planche to Renault, 7 Oct. 1935, 91 AQ 24 (5), The Originals Renault, fonds historique, Archives of the Renault Company, Le Plessis-Robinson.
35 See the memoirs of Fernand Picard, L’épopée de Renault (Paris, 1976), 271–272.
36 Telegrams and letters by Emile Planche in Detroit, 7–29 Oct. 1935, and letter from François Lehideux in Billancourt, 9 July 1937, 91 AQ 24 (5), The Originals Renault, fonds historique, Archives of the Renault Company, Le Plessis-Robinson.
37 Letters between Louis Renault and Jacques Level, 1935, and between François Lehideux and Philippe Level, 1933–1936, 91 AQ 21 (2), The Originals Renault, fonds historique, Archives of the Renault Company, Le Plessis-Robinson.
38 Hachez-Leroy, L’Aluminium français, 216–224; Storli, “Cartel Theory and Cartel Practice”; Bertilorenzi, The International Aluminium Cartel, 173–184.
39 See Michel Freyssenet, statistical table published in 2012, accessed 13 Nov. 2024, http://freyssenet.com/.
40 Annuaire de l’aluminium et de ses industries (Paris, 1950), i–vi; Hervé Joly, Diriger une grande entreprise au XX e siècle. L’élite industrielle française (Tours, 2013), 297–298; Jean-Jacques Baron, “L’Aluminium Français et la promotion de l’aluminium dans l’industrie de l’automobile en France entre 1933 et 1958,” Cahiers d’histoire de l’aluminium, no. 16 (1995): 60–84.
41 A total of 2,000 copies of this catalog with the 102 projects were printed: Album de la voiture SIA 2 places, Boulogne-Billancourt, Société des Ingénieurs de l’Automobile, 1936. See also Frederick A. Usher, “The SIA Contest of 1935,” Automobile Quarterly 16, no. 2 (1978): 212–218; Patrick Fridenson, “Opinion publique et nouveaux produits industriels: les pressions en faveur des voitures populaires dans les années 1930,” in La politique et la guerre. Pour comprendre le XX e siècle européen. Hommage à Jean-Jacques Becker, eds. Stéphane Audoin-Rouzeau, Annette Becker, Sophie Coeuré, Vincent Duclert, and Frédéric Monier (Paris, 2002), 342–353.
42 The Motor Trader, 6 Nov. 1935, 209.
43 Sophie Pehlivanian, “The Grégoire—Institute for the History of Aluminium Collection: An Original Look at the History of the Automobile,” Cahiers d’histoire de l’aluminium, no. 42–43 (2009): 6–55.
44 Jean Hubert, note de service, no. 2152, “Concours aluminium. Réunion le 7 juillet rue de Presbourg,” 8 July 1938, 91 AQ 21 (2), The Originals Renault, fonds historique, Archives of the Renault Company, Le Plessis-Robinson.
45 Jean Hubert, note de service, no. 2152, 8 July 1938.
46 Fridenson, Histoire des usines Renault, 284; Loubet, “L’automobile des années vingt à cinquante: modèle, crise et remise en cause,” in L’économie française dans la compétition internationale au XX e siècle, ed. Maurice Lévy-Leboyer (Paris, 2006), 205–206.
47 Quotation from Maurice Jordan, Peugeot’s deputy COO, July 7, 1938, in Fridenson, Histoire des usines Renault, 284–285.
48 Jean Gremeaux, note, “Compte-rendu de la réunion du 14 décembre de la section Aluminium,” 91 AQ 21 (2), The Originals Renault, fonds historique, Archives of the Renault Company, Le Plessis-Robinson.
49 Jean Gremeaux, note, “Compte-rendu de la réunion du 14 décembre de la section Aluminium,” 91 AQ 21 (2), The Originals Renault, fonds historique, Archives of the Renault Company, Le Plessis-Robinson.
50 Alan S. Milward, The New Order and the French Economy (Oxford, 1970), 235–243; Michel Margairaz, L’État, les finances et l’économie. Histoire d’une conversion 1932–1952 (Paris, 1991).
51 At the same time, Grégoire also designed one of the first electric vehicle models of the German occupation period, this time under contract to Compagnie Générale d’Électricité, CGE-Tudor. Its body was made of sheet aluminium. See Sigfrido Ramirez Perez, “Jean-Albert Grégoire, la voiture tout aluminium et la voiture électrique: le destin commun de deux innovations technologiques entre guerre et Reconstruction,” Cahiers d’histoire de l’aluminium, no. 49 (2012): 70–89.
52 I follow here the archival research by Claude Le Maître, “Les prototypes 4 CV et Aluminium Français Grégoire face à face,” Renault Histoire, no. 10 (June 1998): 47–57.
53 See also the conflicting memoirs of Jean Albert Grégoire, 50 ans d’automobile: La traction avant (Paris, 1974) and of Fernand Picard (Renault’s R&D deputy director), L’épopée de Renault.
54 Patrick Fridenson, “Genèse de l’innovation: la 2 CV Citroën,” Revue française de gestion, no. 70 (Sept.–Oct. 1988): 40–41. See also Roger Brioult, Citroën. L’histoire et les secrets de son bureau d’études depuis 1917, vol. I, 2nd ed. (Avon, 2020 [1987]).
55 Émile Dumaine, Un pionnier sort de l’ombre, ed. Jean-Claude Malsy (Compiègne, 2021), 240–242.
56 Jean Andreau, “Le problème de la voiture économique légère,” Journal de la Société des ingénieurs de l’automobile 19, no. 3 (May–June 1946): 61–68; Edmond Massip, “Et voici…la 4 chevaux Renault, qui concrétise 8 années de progrès,” L’Automobile 1, no. 1 (Sept. 1946.)
57 Ludovic Cailluet, “L’aventure des prototypes de carrosseries légères, 1942–1968,” Cahiers d’histoire de l’aluminium, no. 8 (Summer 1991): 24–44.
58 Renamed Carindal in 1953, the company expanded its sales “without becoming a profit center,” and became part of Cégédur in 1968.
59 Agenda of the steering committee of Société anonyme des usines Renault, July(?) 1942, Louis Renault Papers, Archives of the Association Renault Histoire.
60 Privately kept documents provided by Professor Jean-Marie Guillon, Archives of the Société des Bauxites du Midi.
61 “Société Astronomique de France, Séance du mercredi 7 mars 1934,” L’Astronomie 48 (1934): 168. Also see Jean-Marie Guillon, “Les Bauxiteurs 1936–1943. Enjeux et difficultés d’une organisation patronale marginale,” Rives méditerranéennes, no. 45 (2013):73–84.
62 In 1973, a retired foreman, Mr. Chevalier, donated it to the archives of the Renault Histoire Association, Boulogne-Billancourt.
63 Adrian Jones, “Illusions of Sovereignty: Business and the Organization of Committees of Vichy France,” Social History 11, no.1 (1986): 1–36.
64 Compte rendu de la réunion du Comité d’organisation de l’aluminium et du magnésium, Marseille, 25 June 1943, Louis Renault Papers, Archives of the Renault Histoire Association.
65 Picard, L’épopée de Renault, 281 and 286; Margairaz, L’État, les finances et l’économie, 653.
66 Jean Dupin, Problèmes actuels (Monaco, 1946).
67 Louis Renault was also a major player in the main French airline, Air Union (1923–1932). He attended 30 of its 100 board meetings, as evidenced by the board’s records, sold in Paris at an auction of the Collection Jacques Miloux on April 22, 2017. It is not yet known whether he supported the use of aluminium on the company’s engines or hulls, which occurred later. His two foundry engineers visited Wright Aeronautical in October 1935 (mention earlier in a different context) after the Renault company bought the Caudron Aircraft Company in 1933.
68 George J. Stigler, “A Theory of Oligopoly,” Journal of Political Economy 72, no. 1 (Feb. 1964): 46–54.
69 Margaret C. Levenstein and Valerie Y. Suslow, “How Do Cartels Use Vertical Restraints? Horizontal and Vertical Working in Tandem,” Antitrust Law Journal 83, no. 1 (2020): 15–39.