Much of the product of Austro-Hungarian loom, work bench and forge was quite artistic and charming; that there often was displayed fine taste and originality of conception. Many of the manufactures - such as glassware, china and tableware, leather goods, furniture and articles of domestic decoration, as well as the cloths of Bohemia, etc. - bore a stamp of their own and were appreciated by the connoisseur. But admitting all that, the fact was still true that the whole methods in vogue in its industry were antiquated and did not admit of those processes of standardising and of rendering the volume of output so large and at the same time the selling prices so cheap as to readily admit of competing with more wide-awake nations.
The air of Austria or Hungary was not conducive to the growth of the modern captains of industry that elsewhere had left their mark. And the trend of those elements in both halves of the monarchy that have capital to spare was not, on the whole, in the direction of industrial investments. The Skoda Works was one of the very few exceptions. Czech financiers played a significant role in the development of heavy industry. Emil Skoda (1839-1900) became the major arms producer in the Habsburg Empire. Czechs like Emil Skoda and Tomas Bata [the shoemaker] became symbols of the new Czech capitalists.
The fortunes of the Skoda Works were interwoven with those of Plzen through several generations of employees. The Skoda factories were founded by Count Wallenstain in 1859. Count Wallenstein-Vartenberk set up a branch of his foundry and engineering works in Plzen. The output of the plant, employing over a hundred workers, included machinery and equipment for sugar mills, breweries, mines, steam engines, boilers, iron bridge structures, and railway facilities. Ten years later it was taken over by Emil Skoda, a Czech engineer, who employed 130 people. Emil Skoda purchased the factory from Count Waldstein in 1869 for 167000 gulden with money borrowed from his physician uncle in Vienna, Josef Skoda the great Viennese clinician. Skoda had originally been employed in the iron works of Wallentein (Valdstejn) in Pilsen.
When engineer Emil Skoda purchased a small engineering works located in the centre of Plzen, then a town with a population of 30,000, he set out on a path leading to the major development of his plant and fame for Plzen around the world. The coalfields at nearby Nýrany and local iron-ore deposits gave rise in the 19th century to Plzen's engineering industry, symbolized by the Skoda Works, which occupy most of the city's western sector. Skoda was quick to expand business, and in the 1880s founded what was then a very modern steelworks capable of delivering castings weighing dozens of tons. Steel castings and, later, forgings for larger passenger liners and warships went on to rank alongside the sugar mills as the top export branches of Skoda's factory.
Initially Emil von Skoda held a majority of shares, but the Creditanstalt soon acquired a controlling interest. The Skoda firm became a joint-stock company in 1899 to raise capital for expansion. It was founded in 1899 by the Creditanstalt and the Czech Escomptebank to acquire the existing Company E. Skoda Pilsen, including land, equipment and railway equipment. For decades the company's workshops produced steam machines, equipment for sugar factories, breweries and power stations, machine tools, engines and large forgings applied in the construction of ships. For many armies, the Skoda Works were for years one of the largest suppliers of weapons in Europe.
The Skoda Works were part of the Creditanstalt group and most of the manufacture of artillery was concentrated there. The Skoda works (directed by Emil and Karl Skoda) had become the Monarchy's major producer of machinery and armaments by the 1900s. Skoda Works became the largest arms manufacturer in Austria-Hungary. It was a navy and army contractor, mainly supplying heavy guns and ammunition. Exports included castings, such as part of the piping for the Niagara Falls Power Plant or for the Suez Canal sluices, as well as machinery for sugar mills in Turkey, breweries throughout Europe, and guns for the Far East and South America.
By 1914 Skoda was one of Europe's major arms producers. At the Skoda Works in Pilsen everything was done on an enormous scale - grounds covered, trip hammers of a hundred tons apiece, 30,000 men toiling and sweating for good pay; and capital galore. And enormous profits; during the Great War one of the Krupps became a partner. A Czech, Baron Skoda, was the brain of the concern, and a number of able German engineers were the sub-brains.
The First World War brought a drop in the output of peacetime products. Huge sums were invested into expanding production capacities. By this time, Skoda Works already held a majorities in a number of companies in the Czech Lands and abroad that were not involved in arms manufacture. In 1917, the company had 35,000 employees in Plzen alone.
The Skoda gun, the Austrian 30.5 centimetre (12-inch) howitzer, manufactured at the Skoda Works near Pilsen, was not a surprise: it was tested in the presence of foreign military attaches in 1912. During the Great War some officers in the German ordnance department considered the big guns turned out by the Skoda works in Austria superior to those of Krupp. Just before the War the Skoda plant completed its triumph - the 30.5 c.m. howitzers drawn by traction engines. "See," the objectors claimed. " Skoda is better than Krupp." "Wait," said Bertha Krupp." These Skoda guns, while the biggest movable guns in the world today, are not big enough." And she produced for Germany the famous 42 c.m. howitzers, whose shells were nicknamed "Busy Berthas." These formidable 42-centimetre howitzers laid Liege and Antwerp low.
The Archduke Leopold Salvator was for a number of years before the war, and during the War, the very important post of inspector of the entire artillery for the Austro-Hungarian army and navy. In that capacity he strove hard to obtain from the two parliaments grants sufficient and in time to construct those heavy ordnance which all military experts had predicted would be indispensably needed in the next great war. His efforts proved in vain; at least the appropriations were made too late and in amount quite insufficient. Archduke Leopold Salvator, though personally strongly averse to war, had all along been convinced that such a great war, with all Europe for long resembling a powder magazine, was bound to come.
On an understanding with the aged emperor, but unknown to either the Hungarian or Austrian parliament (except a few members in his confidence), the archduke managed to have those much-needed heavy guns made, mostly at the Skoda Works in Pilsen; to have them tested thoroughly and installed in the army. These were the marvellous 30.5 centimetre howitzers and the 42-centimetre mortars that played such a decisive part in the early days of the war. They had been designed, made and tested wholly without the connivance, even the knowledge, of the German general staff. Liege, it may be recalled, fell before these guns, and the quick capture of Antwerp was also largely due to them.
Soon after war was declared the Skoda works in Austria, practically the equal to Creusot in artillery technique, sent a battery of 30.2-centimeter howitzers to be tried out in comparison with the 21-centimetre field and the 28-centimetre siege howitzers of Krupp make. These are the three types of pieces that finally reduced the chain of forts defending Liege and Namur to fragments, but as the maximum calibre was held by the Skoda guns some observers got the notion into their heads that Austria furnished the big guns and not Prussia. It was not until the army of General von Kluck crossed the Meuse and the bombarding of Fort Maubeuge began that the "Brummers," the 42-centimeter Krupp automobile mortars, were allowed to decide the issue, hence the confusion in terms and calibre by "veteran" war correspondents.
Czecho-Slovak Skoda - 1918-1945
Following the emergence of the Czecho-Slovak Republic in 1918, in the complex economic conditions of post-war Europe the company was transformed from what was exclusively an arms manufacturer into a multi-sector concern. In addition to traditional branches, the production programme embraced a number of new concepts, such as steam (and later electric) locomotives, freight and passenger vehicles, aircraft, ships, machine tools, steam turbines, power-engineering equipment, etc.
In May, 1919, a commission of Ordnance officers was sent to the Skoda Works in Austria for the purpose of investigating their methods of constructing large and small ordnance. While there they secured additional data from the chief engineer of the plant with reference to the design of the gun, and saw the three guns which had been in process of construction on November 11, 1918.
Its trademark - a winged arrow enclosed with a circle, devised in the 1920s, has been a guarantee of top technical standards and product quality, the dimensions and quantities of which and the purposes for which they were produced Emil Skoda would have never dreamed of. Over the years, the lives of hundreds of thousands of the inhabitants of Plzen and the surrounding area have been linked to the plant in times of both peace and war.
At the beginning of December 1895 the mechanic Václav Laurin and the book-seller Václav Klement, both bicykle enthusiasts, hd started manufacturing bycycles of their own design, patriotically named Slavia in the nationalist atmosphere of the ond of the 19th century. A few years later, in 1899, the Laurin & Klement Co. began producing motorcycles, wich were soon succesful and gained several racing victories. After initial experiments at the turn of century, producing of motorcycles was gradually replaced by automobiles form 1905 onward.
Like the motor cycles, the first Laurin & Klement automobile, the Voiturette A, was a full success, later becoming the archetype of Czech automobile classic. It soon formed a stable position for Company in the developing international automobile market, so that the Company could soon start operating on a wide scale. The volume of the production increased and soon exceeded the potential of a private enterprise, and in 1907 the founders of Laurin & Klement initiated conversion to a joint-stock company.
Skoda took part in significant companies in the cast steel, machinery and weapons production, since 1924 automobiles. First, a Hispano-Suiza "designed by Marc Birkigt, was copied under license. In 1925, fusion with the Pilsen Skoda Co. was accomplished, marking the end of the Laurin & Klement trademark. In early 1930s, the automotive business was again organized as a separate joint-stock company within the Skoda Group (Automobile Industry Co., ASAP). After the crisis, the Company achieved a break-through with the Type Skoda Popular.
The deteriorating political situation in Europe saw arms production rise again in the mid-thirties.
By the Munich Agreement signed in September 1938 by Great Britain, France, and Germany, Czechoslovakia, under President Eduard Benes, agreed to cede the Sudetenland to Germany. By the end of the year the Sudetenland was incorporated into the Reich, the district of Teschen was seized by Poland, portions of southern Slovakia was acquired by Hungary, and the rest of Slovakia became a vassal state of Germany. Hitler's quick absorption of the whole of Czechoslovakia included the famous Skoda ironworks, and he subsequently used the conquered nation as a Nazi arsenal.
The Reichswerke Hermann Goering acquired a significant hold on the Czech economy, acquiring coal and steel mills, as well as two of the top three iron works and three large Czech armaments concerns, including the Skoda Works. Reich Works Hermann Goering acquired large possession of shares in the Skoda Works, in order to use the latter as a finishing industry for the products of their own rolling mills and steel works, just as they used other industries in Germany. At that time the Skoda Works was one of the largest armaments complexes in Europe. The production volume of Skoda Works between August 1938 and September 1939 alone was nearly equal to that of all British arsenal factories in that period. The adverse loss of Skoda Works to Germany drastically increased Hitler's military power.
In a conference between Goering, Mussolini, and Ciano on 15 April 1939, one month after the conquest of Czechoslovakia, Goering told his junior partners in the Axis of the progress of German preparations for war. He compared the strength of Germany with the strength of England and France. He mentioned the German occupation of Czechoslovakia in these words: "However, the heavy armament of Czechoslovakia shows, in any case, how dangerous this country could have been, even after Munich, in the event of a serious conflict. Because of Germany's action the situation of both Axis countries was ameliorated, among other reasons because of the economic possibilities which result from the transfer to Germany of the great production capacity (armament potential) of Czechoslovakia. That contributes toward a considerable strengthening of the axis against the Western powers."
The Skoda Works led a charmed life until the end of World War II. On the night of 16 April 1943, Bomber Harris sent out more than 300 Lancasters to make the long flight to Pilsen, Czechoslovakia, where they would bomb the Skoda Works. Since the target was far beyond the range of Oboe, the attack used H2S. The H2S operators mistook the town of Dobrany for Pilsen (a 12-mile error) and a large mental hospital for the Skoda Works. Two hundred eighty-five bombers proceeded to deluge the area with 691 tons of bombs - a nightmarish absurdity that even Franz Kafka would have found difficult to express. The attacking force suffered grievously too. It lost 36 aircraft, more than 12 percent of the attacking force.
At the end of May 1943, in the remaining large raid of the month, Harris tried again for Pilsen. This time 150 bombers correctly identified the target, but landed almost all their bombs in a field outside the plant. The Fifteenth air Force raided Czechoslovakia in the middle of October 1944, striking at the Brux synthetic oil plant (416 tons), the Skoda Works at Pilsen (307 tons), and miscellaneous rail yards. On 25 April 1945 the Eighth Air Force launched the last heavy bomber combat mission in the European Theater, destroying 75% of the Skoda Armaments at Pilsen, Czechoslovakia.
World War II brought the plant to the verge of destruction, but its employees, whether those from the production workshops, construction studios or laboratories, worked with dedication to achieve its revival, modernization and expansion so that it could contribute not only to the development of the town of Plzen and the Czech Republic, but also that of neighbouring as well as remote countries.
Skoda Under Communism
In 1945, the company was nationalized. Severely damaged in World War II, the Pilsen factories were rebuilt and restored to production, renamed the V.I. Lenin Works. Best known for munitions, the Skoda Works also manufactured heavy machinery of various types, military aircraft, railway locomotives, and cars. Skoda pioneered the development of electric-railway locomotives, with plastic body panels to reduce axle loadings.
Skoda Works was gradually split up into different sections (e.g. the car works in Mladá Boleslav, the aircraft plant in Prague, arms factories in Slovakia, and other plants producing food-industry equipment). The company's main task now was to produce equipment for heavy engineering, capital construction in the industrial sector, public transportation, and power engineering. Most exports were headed towards the Eastern Bloc.
By the 1960s Skoda was largely engaged in civil, not military, activities. Based on the traditional production processes and past success, the Czechoslovak economy managed to maintain a relatively good standard in the post/socialist period for several decades, in spite of the changes brought about by planned economy and efforts at unduly rapid growth. This standard only became questionable towards the end of the nineteen sixties due to development of new technology in the western world. The permanent stagnation of the economy started after the seventies, also affecting the Mladá Boleslav automobile manufacturer in spite of the company's leading position in the East Europe marker. Production grew again only when the model range Skoda Favorit went into production in 1987.
Following the change in political climate in 1989, SKODA started along the path of privatization, and used this time to come up with an optimal production program, make new business contacts, and look for markets other than those that had so far been its priority (and only) markets, i.e. the Comecon countries and the Soviet Union, which collapsed after 1989.
The conversion of Slovak arms manufacturing enterprises came like a bolt from the blue. It was more a political than a rational gesture. The previous government was stuck between two stones: It was limited by the proclaimed decision of federal bodies to phase out the production of heavy weaponry and, on the other hand, by the social and economic pressure against the conversion of the armaments industry.
The Skoda arms works, which had made Czechoslovakia the best armed of the successor states to the Austro-Hungarian empire, turned out arms for the Third Reich in quantity, as it had done for the vanished Czechoslovak republic. The state wrote off Kcs2 billion of debts of Skoda Works, the holding company to which Skoda-Plzen, the initiator of the RDP group, belongs. Federal government conversion programs allotted 90 percent of the $72 million set aside for conversion to Slovakia. Few Czech defense industries received conversion funding and many went out of business. http://www.skoda.cz/en/
In the year 1859, count Valdštejn-Vartenberk established a subsidiary of his foundry and engineering works. In 1866, ing. Emil Škoda, a highly competent engineering expert and dynamic entrepreneur, became the Chief Engineer of the factory which had more than a hundred employees, and in 1869 he purchased the factory. After a short time he expanded the factory and in the 1880s he founded steel works, which were very modern for his era and were able to deliver castings weighing tens of tons. Steel castings and later forged pieces for large passenger and military ships became, together with sugar refineries, important export articles of the Škoda factory.
In 1899 the ever expanding enterprise was transformed into a joint-stock company, and as early as before World War I, Škoda works became the largest arms factory in the Austro-Hungarian Monarchy predominantly supplying heavy guns and ammunition to naval and land forces. Not only castings were exported, of which piping sections for the Niagara Falls power plant and for Suez Canal sluices is particularly worth mentioning, but also machinery for sugar refineries in Turkey, breweries throughout Europe and artillery materials for the Far East and South America.
The war years between 1914 and 1918 caused a decline in piece production. Considerable funds were invested in the construction of new production capacities. At that time Škoda works were controlling, through share majority, many companies producing more than armaments alone in both the Czech lands and abroad. By 1917 more than 35 thousand employees were working in Plzen. In 1914 Skoda had been one of Europe's major arms producers, with 30,000 workers. In May 1917, 50,000 workers at the critically important Skoda arms works went on strike, forcing the Emperor Karl to order troops to put down the strike.
After establishing the Czechoslovak Republic in 1918, the company was transformed under the complicated conditions of post-war Europe from an exclusive armaments factory into a multi-industry concern. In addition to traditional industries, the production program included many new ones, such as steam and later electric locomotives.
In 1923 the world renowned trade mark of a winged arrow in a circle was registered in the Commercial Register. During the middle of the 1930s the worsening political situation in Europe caused an increase in armaments production volume. The end of World War II brought considerable damage to the company as 70% of the factory grounds were practically destroyed after air raids.
An idea of the extent of the Czechoslovak arms industry is given by the ramification or decentralisation of the Skoda Works, which possessed groups of works in Pilsen, Prague, Konigsgratz, Hradek, Komorn, Jungbunzlau and Brno. The products of the Czechoslovakian Skoda arms works played a major part in the international flow of munitions. With funds from the urgently mobilized American Jewish community, Israel was able to purchase large amounts of first-rate military equipment from communist Czechoslovakia's Skoda Arms Works. Arbenz compounded his threat to US economic interests by secretly purchasing 2000 tons of arms from the Skoda arms firm of communist Czechoslovakia.
In 1945 the concern was nationalised. Individual departments of Škoda works were gradually separated from the parent company including the car factory in Mladá Boleslav, aircraft factory in Prague, works in Slovakia and other factories producing food processing equipment.At the urging of the Warsaw Pact, the important Czechoslovak armaments industry was transferred from the vicinity of the border with the West to secure central and eastern Slovakia. The great Skoda arms factories in Plzen switched over entirely to cars, machinery, and railroad equipment. The Slovaks got a classic Faustian bargain; things were humming during the Cold War, but when it ended, the markets disappeared. Skoda, once the leader in the former Czechoslovakia's armaments production (60 percent of the production), retired from this sector completely in the 1960's. Production of machinery for heavy engineering, industrial capital construction, mass transport and power engineering became the main production program at Pilsen. Export was directed largely to the countries of the former socialist block. With the division of the country at the beginning of 1993, the Czech Republic lost all access to the manufacture of heavy weapons.
After 1989 a transformation period began for the ŠKODA concern to transform it from a state enterprise into a joint-stock company and to find not only the optimum production program, but also to expand business contacts and find other markets than the preferred countries of the Council for Mutual Economic Assistance which collapsed after 1989. ŠKODA Transformation started diversification of its production program from the key industry of production of railway vehicles to include the sphere of public urban transport. Since the end of the 1990s there has been extensive modernisation of subway train units and increasising production of modern low-floor trams.
While some companies may have chosen to form foreign alliances, in some areas Czech industry is strong enough to succeed without foreign investment. The electronics sector, in particular, was in a good condition. In the mid-1980s the Czech electronics industry was the world's seventh largest producer of military electronic devices. The skills underlying this strength survived. The smaller Czech munitions and weapons manufacturers were also experiencing better times by the late 1990s.
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