Chapter 315: The Textile Revolution
In Royal Square, everyone exchanged bewildered glances.
They had expected the Crown Prince to attend a banquet and perhaps a ball before discussing serious matters the next day. But instead, he immediately dropped a bombshell, declaring, "Lyon is on the verge of collapse."
Most of those present were involved in the textile industry. While they thought the Crown Prince might be exaggerating, they couldn't deny that the industry was about to face brutal competition from the British.
Joseph paused, pointing to the automated loom placed beside him, which had been set up specifically for the occasion. "Our only chance to compete with the British is through production efficiency!"
"You've probably heard that this automated loom weaves fabric ten times faster than a manual loom. And as we continue to improve it, the efficiency will only increase.
"This means that a factory using automated looms would only need one-tenth of the workers it used to employ!"
Here, Joseph was bending the truth a bit. While the automated looms were indeed more efficient, they still required a significant number of workers to operate them—at best, the workforce might be reduced by a quarter. However, the increase in production would be substantial.
Joseph continued, "Only by doing this can our textiles come close to matching British production costs.
"But the British started using automated looms years ago.
"This means that their costs will continue to drop, and our products will be completely shut out of the market!"
British automated looms were a closely guarded trade secret, and France didn't know the specifics. But hearing this from the Crown Prince, the crowd grew tense.
Mirabeau's people had already tried promoting automated looms, but they hadn't pushed as hard as Joseph was now. As a result, no one had paid much attention. Now, they realized how dire the situation had become.
Seeing that the atmosphere was just right, Joseph shifted his tone, "The good news is that the British don't yet have a large number of automated looms, and theirs are all water-powered.
"That's what I meant earlier by saying this is Lyon's last chance.
"If Lyon starts using automated looms on a large scale now, powered by our latest high-pressure steam engines, we can surpass British production efficiency and reclaim the market that's rightfully ours!"
He didn't mention that widespread use of automated looms would also drive improvements in steam engines, creating a positive feedback loop.
The factory owners in the audience murmured among themselves for a while. Finally, at their urging, the president of the Lyon Chamber of Commerce, Boyer, stepped forward, bowed to Joseph, and said, "Your Highness, everyone here is aware of the advanced performance of the automated loom. The problem is... it's too expensive.
"A loom and its accompanying steam engine cost over 16,000 livres. To achieve any kind of scale, you'd need at least three looms. Then there's the cost of training workers, starting production, and so on, which all add up.
"Most of us can't afford such a large investment. And even if we pooled our money to buy the looms, if there's any issue with raw materials or the market, leading to poor sales, the previous large investment could quickly bankrupt our factories..."
Joseph nodded slightly. He knew Boyer was addressing very real concerns.
In the 18th century, using new technology was a highly risky endeavor due to insufficient technical validation, misinformation, or a lack of supportive policies.
Even in Britain, the birthplace of Europe's new technologies, it took decades to popularize the automated loom, and even then, it was driven by water wheels. Steam-powered automated looms wouldn't become widespread in Britain until the 19th century.
Similarly, although Watt had completed his steam engine improvements nearly a decade ago, annual sales were still under 20 units.
In France, steam engine sales had only picked up because Joseph had used parish banks to provide loans to rural areas for purchasing pumps for irrigation. Without that, Murdoch's technological advances wouldn't have progressed so quickly.
But as someone who had experienced the capitalist era, Joseph already had a mature solution.
He raised his hand to quiet the crowd and then spoke loudly, "To address your concerns, the government has already made preparations.
"We are introducing investment insurance!"
Once again, the crowd exchanged confused looks. They understood the word "insurance," but adding "investment" in front of it left them puzzled.
While the insurance industry had been around since the 17th century, it was still limited to a few types, such as marine, fire, and life insurance.
Joseph smiled and explained, "The French Commercial Insurance Company can offer insurance for investments in automated looms. The company will verify the factory's funds and operations and assign agents to monitor production.
"If the insured factory goes bankrupt, the insurance company will investigate its operations and financial records. As long as there was no fraud, the investors will receive 80% of their investment back.
"Of course, the insurance company will take over the factory's assets."
Honestly, this type of insurance posed a significant risk for the insurance company. However, Joseph had full confidence in the automated looms. As long as the factories operated normally, they shouldn't go bankrupt.
And even if a factory did fail, Joseph could have the insurance company acquire its assets, merge them into a large textile company, and continue operating with government investment.
For the sake of France's textile industry revolution, the newly established French Commercial Insurance Company, funded by the French Treasury, would bear the risk.
The factory owners in the crowd immediately began discussing excitedly among themselves, "If we only lose 20%, it might be worth trying."
"This kind of insurance is a huge help."
"But what if something goes wrong? Can the insurance company afford to pay out?"
"I heard from Mr. Varennes that this company is backed by the French Treasury. There shouldn't be any issues with funds."
"That's great! I've wanted to buy a few automated looms for a while now. Anyone interested in partnering up?"
Joseph seized the opportunity to add, "Perhaps you've already heard that we've signed a trade agreement with Austria and six southern German states.
"From now on, Lyon's textiles can be directly sold to southern Germany via the Rhine River, with tariffs at least as favorable as those on British goods. In some countries like Baden, they'll be even lower."
The square erupted in gasps of surprise.
Being able to enter such a large market in southern Germany was a major boon for France's textile industry, likely leading to a significant increase in sales.
Joseph continued to "motivate" the crowd: "Additionally, we've secured a new source of wool from the Pacific, with a potential output exceeding one million pounds, possibly reaching two million pounds next year. The price will be half of what it currently is on the market!"
In reality, he was being modest. New Zealand was a sheep-raising paradise, and if the sheep population grew, its wool production could even surpass that of Britain!
(End of Chapter)
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