Industrial Consumers Versus Cartelized Producers: The French Carmaker Louis Renault and the Aluminium Cartel, 1911–1944

Patrick Fridenson

Business History Review, 2024, vol. 98, issue 3, 637-655

Abstract: 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?

Date: 2024
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