The early years
By the middle of the 19th Century the industrial revolution has caused the disappearance of many crafts in Europe, fewer and fewer workers are now required. In a first process of globalization transport links are developing at great speed. For the first time, railways are enabling even ordinary citizens to move their place of residence, while the first steamships are being tested in overseas trades. A great wave of emigration to the United States is just starting.
"Speak up! Why are you moving away?" asks the poet Ferdinand Freiligrath in the ballad "The emigrants" that became something of a hymn for a German national movement. The answer is simple: Because they can no longer stand life at home. Until 1918, stress and political repression cause millions of Europeans, among them many Germans, especially, to make off for the New World to look for new opportunities, a new life.
Germany is splintered into backward princedoms under absolute rule. Mass poverty prevails and the lower orders are emigrating in swarms. That suits the rulers only too well, since a ticket to America produces a solution to all social problems. Any troublemaker can be sent across the big pond. The residents of entire almshouses are collectively despatched on voyage. New York is soon complaining about hordes of German beggars.
The dangers of emigration are just as unlimited as the hoped-for opportunities in the USA. Most of the emigrants are literally without any experience, have never left their place of birth, and before the paradise they dream of, comes a hell. Reaching the port cities after a strenuous journey, these exhausted people have to wait for weeks there for passages and are harried and robbed in the squalid port districts.
The crossing on small wooden sailing-ships lasts between 70 and 100 days on average, but often much longer. Passengers, especially emigrants in the low, cramped tweendeck, are treated like cargo of inferior value. They often have to bring along their own provisions, drinking water rapidly grows scarce and hygienic conditions are catastrophic. Death rates correspond, and every voyage involves taking a risk with an unknown outcome.
In 1845 more than 115,000 Germans emigrate, the population of a medium-sized big city. Nine of ten of the travellers emigrating via German ports embark in Bremen, where the Senate had passed protective laws in 1832. Hamburg, the largest port in Germany, had done its best to keep the poor and often sick emigrants away with restrictions. Since relaxation of these in 1837, conditions in the port area and on many ships were such that Bremen’s lead was in no danger.
In 1846 the German-American "Ocean Steam Navigation Company" is founded. Among those involved is Hermann Henrich Meier, a Bremen merchant and later consul, dreaming of a direct Bremen - New York steamship line. The company rapidly slides into bankruptcy. Hamburg remains generally reserved in its attitude to progress. Yet it has no wish to leave emigration, a growth market, to the competition in Bremen.
On 27 May 1847, conditions for emigrants start to improve decisively. In the Conference Room of the Hamburg Stock Exchange shipowners and merchants found the Hamburg-Amerikanische Packetfahrt-Actien-Gesellschaft or Hapag for short. Adolph Godeffroy becomes its first director. Its aim is to run a faster, more reliable liner service between Hamburg and North America, initially New York, using first-class sailing-ships.
The board of directors wish to create "something outstanding" and this is also apparent in its novel corporate philosophy. Hapag for the first time sees its passengers not as human freight, but as customers whose business needs to be sought. The fully-rigged sailing-ship "Deutschland" enters service on 15 October, offering even emigrants modest yet noticeable improvements appropriate to the times. "Service at Sea" is a concept that means success.
The packet sailing-ships "Deutschland", "Nord-Amerika", "Rhein" and "Elbe", all of around 500 grt and with accommodation for some 220 passengers, are regular record breakers. For the outward passage from Hamburg to New York they require a sensational average of 40 days, and with the west wind just 28 days for returning. The crush is great and in Bremen there are complaints that Hapag is luring the emigrants away with unsuitably good food.
The collapse of the German Revolution of 1848 and the ensuing repressions caused a fresh leap in emigration. Hapag, which understood itself to be "sound and respectable through and through", is in a phase of "gratifying progress". One particularly attractive offer: "Indeed, attention has been paid to providing a separate berth for every passenger."
The mails were transported overseas in packets, bags of oiled leather or linen and this valuable cargo was only entrusted to the fastest, most reliable liner shipping companies. To call a shipping company such as Hapag a "packet line" called for ships of high quality and well trained crews. Several shipping companies founded at that time included this demanding quality seal in their names. Only with Hapag it has survived.
Hapag pays its shareholders a dividend of four percent for the first time. Since a united Germany does not yet exist, its sailing ships fly the red-white Hamburg city flag as the flag of their home country. Not invariably, however: When the Elbe estuary was blocked for German ships after the outbreak of the war between Germany and Denmark in 1849, as the first German shipping company Hapag re-flagged its "Deutschland" at short notice, which then sailed undisturbed to New York as the Russian "Hermann".
Hapag’s director Adolph Godeffroy summons an extraordinary meeting of shareholders and passionately advocates building two large screw- steamships. He had only recently still rejected technical and business experiments of this kind, yet is aware that time is now pressing: The eternal Hanseatic rivals are stirring. Competition looms from the Weser or from that "busy neighbouring city" of Bremen, as an unhappy Godeffroy calls it.
There is no united Germany as yet, not even the North German Federation, yet Hermann Henrich Meier is planning no less than the major German shipping line - to be based in Bremen on the Weser. Apart from his dream plus shares in a few modest river steamship and towage companies that he wishes to merge, all that he so far has is a name: "Norddeutscher Lloyd" or North German Lloyd.
The first Hapag steamships, "of iron and first class", are launched at Caird & Company in Greenock, Scotland. German shipyards are not yet capable of building iron screw-steamships. The "Hammonia" and "Borussia" are both of over 2,000 grt, 101 metres long, almost 12 metres wide, with a speed of 11 knots. They have a crew of 80 and can carry 510 passengers, 310 of them in steerage.
Hapag’s first steamship, the "Borussia" under Captain Ehlers, arrives in her home port for the first time on 4 April. There is a tremendous reception for her, with salutes and fireworks, and a big street party as she sails on her maiden voyage. A month later, the city greets her sister-ship "Hammonia" with the same enthusiasm. The "Borussia" transports the mail in record time on her very first voyage and Hapag offers a monthly liner service.
Hermann Henrich Meier has managed it. Along with young Eduard Crüsemann from Berlin, he has convinced Bremen business to invest in a "magnificent, exclusively German" Transatlantic steamship line. Norddeutscher Lloyd (North German Lloyd – NDL) is founded in Bremen on 20 February 1857.
In Hamburg’s port district, Albert Ballin is born as the thirteenth and last child of a small businessman, a Danish-Jewish passage agent, on 15 August. He literally grows up in the harbour.
The burghers of Bremen rejoice as the "Bremen", NDL’s first steamship, sails down the Lower Weser on 12 June. The entire region celebrates, thrilled to identify itself with the renowned company. On board, Meier presents the arms that are later included in the company’s house flag: "an anchor, crossed by a key, and a wreath of oak leaves". A catastrophe engulfs the Hamburgians: The Hapag steamship "Austria" catches fire at sea with the loss of 471 lives.
Tremendous plans yet a miserable start: Three of the four NDL steamships prove unserviceable. Offering tough competition, from the start Hapag attempts to push its new rivals out of the North Atlantic business. An alternating sequence of keen competition and discreet cooperation sets in between the shipping companies that represent the two Hanseatic cities that had traditionally been rivals down the centuries. This is to persist for over a century and set benchmarks in world shipping.
NDL is on the brink of collapse, with heavy losses, a poor image and rebellious shareholders. The end seems to have arrived when yet another bank suddenly offers a large packet of shares for re-purchase at just 28% of nominal value. In a bold coup Meier re-acquires these on his own initiative. Thanks to his excellent contacts, he succeeds in rescuing NDL.
Success for Hapag and NDL: The United States postal authorities transfer the entire mail transport between New York and Southampton to the "Packetfahrt". The press is amazed by the unparalleled service on board the Hapag steamships. Even for steerage passengers, "soft white bread of superb quality is baked daily." There was a new start for the Bremen owners too. A new overseas steamship, the "Hansa", is launched.
A first Hapag-Lloyd joint project sees the companies coordinating their departures instead of despatching them in costly direct competition against each other. In the following year they jointly lease an area in Hoboken on the Hudson River opposite Manhattan. Hapag and NDL build piers and passenger facilities there alongside one another. These will form the gateway to the New World for millions of emigrants.
In recent years Hapag has distributed dividends of between six and ten percent, although the American Civil War has caused a steep drop in passenger totals in the United States and cargo business is also noticeably ailing. NDL reports its very first trading year free of crises, has established itself firmly in the North Atlantic trade and pays dividends of two percent.
Hapag has sold the "Hammonia", its first steamer, to Allen Line in Liverpool and orders a new vessel, as an exception not from its "house shipyard", Caird & Company in Greenock, Scotland, that had also built NDL’s first two steamships, but from C. A. Day & Co. in Southampton. The "Allemannia", 2,665 grt, around 98 metres long and with accommodation for 760 passengers, enters service in 1865.
Following the end of the American Civil War, passenger totals on the North Atlantic rise steeply once again. Hapag follows Bremen’s example and offers weekly sailings. The company considerably extends its handling facilities at Jonashafen in Hamburg, orders two new 3,000-grt-steamships and plans a connection to New Orleans.
The war between Prussia and Austria is succeeded by the foundation of the North German Federation dominated by Prussia. Hamburg and Bremen join, and soon Hapag and NDL ships are no longer sailing under the flags of their cities but under the colours of the Federation, the "black-white-and-red" flag later regarded as a seal of quality on all the world’s oceans.
The new Hapag steamships, the second "Hammonia" and the "Cimbria", enter service for the beginning of the season. Of 3,035 grt and 3,025 grt and around one hundred metres long, they are the largest German ships. A crew of 125 looks after 678 passengers, 58 in the first class, 120 in the second class and 500 in steerage. With a speed of 11 knots the steamships were to cross the Atlantic in 10 days.
Cautious growth: The next Hapag steamships of the "Hammonia" class are put into service with the "Holsatia" and "Westphalia". While these are again the largest German ships, they only marginally top their predecessors. The "Packetfahrt" is expanding, but as its concept of itself proclaims: solidly, "sound and respectable through and through". By 1874 Hapag will have put altogether 13 steamships of this type into service.
Mourning on the Weser: Eduard Crüsemann, co-initiator of the founding of NDL and the shipping company’s first director, dies at the age of only 43. In the city the word is that he has literally worked himself to death for the company. Even the Senate in Bremen feels that this is meanwhile the most honourable obituary that there can be in the region: "We glory in the splendour that Lloyd has brought to Bremen."
"The outlook for the new financial year remains bright in all respects" prophesies Hapag’s board. The company now has a dry-dock of its own for its growing fleet and moves into the first building it has owned, at Deichstrasse 7. Yet war breaks out July between the German states and France. All overseas traffic comes to a standstill in August and September.
The Franco-Prussian War has been won, the unified German Empire is proclaimed, the King of Prussia is crowned Emperor of Germany. Hapag enters the new era with 14 steamships, while NDL owns 16 Transatlantic steamers and transports over 40,000 people to the New World this year. The capital of both companies is considerably increased. Both continue to vie for top place as the youthful Empire’s most important shipping company.
With the foundation of the Empire and the economic upswing, for the moment there is a lull in emigration from Germany. By contrast, emigration from Eastern Europe, and especially the exodus of Jews from Imperial Russia, climbs steeply. NDL, meanwhile conveying more passengers than the competition in Hamburg, decides on the largest construction programme in its history with the aim of steering growing overseas traffic towards the Bremen ports.
North German Lloyd aims for the top with a fleet of large, swift and modern steamships, the first of them being the "Strassburg" that had entered service the previous year. Hapag had received competition in its own city from Adler-Linie in 1872, but an economic crisis that had started in Vienna brings the boom of the Gründerjahre to an end. With a solid financial base, Hapag escapes almost unharmed and later buys up its competitor.
After the sudden death of his father, Albert Ballin (17) has to take over his small emigration agency in the Port of Hamburg. Ballin, having grown up as a Jew in crowded conditions, is from his own personal experience far more aware of the situation, the cares and the needs of his clientele than the well-heeled shipowners. Until then of no significance whatever, the agency begins to flourish.
Bremerhaven, 11 December: During the loading of the "Mosel" a cask slips from the crane, hits the quay - and fatally detonates in the middle of crowd of people embarking. The first great insurance fraud has failed. The lethal cargo was intended to sink the fully booked NDL steamship at sea. This unprecedented attack by a single perpetrator claims 81 lives and over 200 seriously injured, yet the premature accident saves almost 800 people.
With the "Habsburg", NDL puts the last of thirteen steamships of the "Strassburg" class into service. Of more than 3,000 grt and with a crew of around 100, this type had acquitted itself equally well in all trades, carrying over 1,000 passengers at a speed of about 12 knots. The ships are fitted with modern compound steam engines. NDL’s fleet now comprises 22 large ocean-going steamships.
Johann Georg Lohmann becomes director of North German Lloyd. Running its own quays and repair workshops in Bremen and Bremerhaven and a dry-dock, the largest German shipping company, meanwhile regarded there as a "state within a state", is a highly respected, unassailable institution, even if business is once again not all that brilliant. Shipping is in the doldrums and recently opened lines are soon incurring losses.
Problems arise for Hapag, which has never been a sacrosanct institution in its home city in the same way as NDL in much smaller Bremen, but just one shipping company among many. Competitors from its home patch are appearing constantly, Adler-Linie being the most recent. The "Packetfahrt" had acquired the company and all its vessels in 1875, thus burdening itself with an oversized, uneconomic and partly obsolete fleet, by contrast with NDL.
Ruinous competition, ship losses and economic problems see NDL slide into a depression. Director Lohmann decides to use first class steamships for the North Atlantic route to get the company moving again, to make it the talk of the industry and to take it to the top. The star among the liners on the New York run is the new British "Arizona" with a speed of 16 knots and making the crossing in eight and a half days. The aim in Bremen is to outshine her.
Changing of the guard: After 33 years at the top, Adolph Godeffroy, Hapag’s first director, steps down. He leaves a solid company of good repute. His in part already downright elderly and extremely conservative successors give preference to their own affairs and tend to run the business as a sideline. Most members of the supervisory board are also far more committed elsewhere. The results soon reflect this.
NDL’s new flagship, the "Elbe", now proves a sensational success in every respect. Her interior layout and Johann Poppe’s decoration in opulent "steamship style" cause as much of a stir as her maximum speed of 16 knots. She immediately breaks commercial records. NDL now has nine of these splendid vessels built in quick succession. Record speed becomes a Bremen trademark.
With the "Rugia" and "Rhaetia", Hapag has steamships built at German shipyards for the first time. The Hamburgians have nothing remotely comparable to compete with Lloyd’s fast steamship service. Their new flagship, the third "Hammonia", which is launched in Glasgow, is obsolete from the start. Except for one remarkable innovation, for the "Hammonia" is the first German ship to be fitted with electric lighting in the passenger lounges.
On 19 January, two hours after midnight, Hapag’s "Cimbria" collides in dense fog nineteen nautical miles NW of Borkum with the British steamship "Sultan", is ripped apart by her pointed bow and sinks within a quarter of an hour. Over 430 passengers and crew members perish in the ice-cold water. The catastrophe overshadows the inauguration of Hapag’s new pier in Hoboken.
Hapag has ignored the ambitious young passage agent Albert Ballin until in 1881 this outsider mounts a frontal attack: Together with a shipowner he offers unbeatably low rates for passages en masse to New York. A long, destructive rate war followed, until the cheapest passage across the Atlantic cost just six dollars. Hapag, in any case suffering from "business despondency", now begins to take on a list.
NDL, enjoying great success with its weekly express steamship sailings, is now also awarded the government contract for the new Imperial mail steamship services to the Far East and Australia. Hapag has so many problems that it does not even tender for the lines. The "Packetfahrt" is "just about to disappear beneath the waves". Then the shareholders rebel, and the board resigns after an extraordinary general meeting.