The Global Cigarette: Origins and Evolution of British American Tobacco, 1880-1945

Published by EH.NET (March 2001)

Howard Cox, The Global Cigarette: Origins and Evolution of British American

Tobacco, 1880-1945. Oxford: Oxford University Press, 2000. Pp. xxii +

401. ISBN 0-19-829221-X, £35.

Reviewed for EH.NET by Geoffrey Tweedale, Manchester Metropolitan University.

Global Cigarette charts the history of modern cigarette production from its

origins in the 1880s through to the development of an internationalised

industrial and marketing structure in the 1940s. The subject is British

American Tobacco (BAT), which was formed in 1902 when an American invasion of

the British market triggered an Anglo-American alliance between the leading

tobacco interests. BAT was an arm of the American Tobacco Corporation (headed

by US tobacco kingpin James Buchanan Duke) and British-based Imperial Tobacco.

The latter was given exclusive control of the British market, while the rest

of the world was allotted to BAT (with the Americans holding a majority of the

equity) - thus marking out BAT from the outset for a career as multinational.

When the controlling American interests were forced to withdraw in 1911 after

an anti-trust action, BAT became British-owned and controlled and its overseas

business expanded rapidly in the inter-war period.

Cox's account is basically chronological, beginning with a discussion of the

exploits of Duke, the mechanisation of cigarette manufacture, and the growth

of international competition between the 1880s and 1902. This is a fairly

well known story and the least original part of the book, though the main

developments are set out very clearly. BAT's growing control of the

international market between 1902 and 1918 is considered next. From its

London headquarters, BAT - as one of the world's first manufacturing-based

multinational corporations - began to expand into markets in the British

Dominions, Europe and the Far East. Here the author starts to deploy a wide

range of source materials - BAT archives, public records, government data, and

trade journals - that enable a detailed analysis of BAT's overseas trade and

its business structure. A detailed breakdown of BAT data is presented in

appendices. While the Americans were still in control, Anglo-American

differences in business methods were apparent, though by the 1920s it is

argued that BAT had developed its own culture and hierarchical organisation.

A major section looks at BAT's activities in China and India and so attempts a

host country perspective. BAT's marketing drive in China (which had been an

American idea) was significant: in the early 1920s, it had eighty per cent of

cigarette sales there, though political and economic developments soon eroded

this dominant position. In India, BAT became the first British manufacturing

multinational to invest in production capacity in that country. Interestingly,

BAT's management approach in these two countries reflected the importance of

national cultures: more commercially-minded in China, where BAT's American

input was apparent; but paternalistic in India, where BAT's colonial

sentiments were to the fore.

The last part of the book describes the emergence of renewed international

competition in the 1920s and the increasing cartelisation of the industry in

the 1930s. BAT now turned its attention to Latin America and the American

market, where the formation of BAT subsidiary Brown & Williamson was to reap

rich dividends. By the 1930s, BAT was involved in fifty separate markets,

largely through a forest of nominally independent concerns. The collapse of

these markets during the war was to present BAT with a major challenge.

Attempting to evaluate the performance of this multinational network is

evidently a daunting task, even for someone with Cox's knowledge of BAT's

empire. The picture that emerges from all the detail is somewhat similar to

that presented by business historians of other companies and industries in the

inter-war period: decidedly mixed. This was inevitable, given the range of

countries covered and the volatile international economic and political

situation in the 1930s. On the other hand, BAT's overseas policy - typical of

British firms in that era - of running subsidiaries fairly loosely from head

office was also part of the reason for this mixed record. This reflected the

thinking of BAT chairman Sir Hugo Cunliffe-Owen, who was the driving force

behind company strategy in the inter-war period. Cox provides a favourable if

somewhat pedestrian account of Cunliffe-Owen, noting some of his weaknesses,

but basically viewing him as the architect of great company whose death was a

great blow. BAT did make money under Cunliffe-Owen, but his main achievement

seems to have been to create an unwieldy and inefficient overseas business

empire that depended far too much (as Cunliffe-Owen intended) on central

control. His other activities, which Cox politely describes as 'unorthodox'

and financially sophisticated, included diverting BAT money into some rather

shady business ventures, which resulted in major losses and a financial

scandal. Even in the 1930s, it seems, BAT was no stranger to controversy.

Cox says that his book is not a conventional corporate history (presumably

because it is management oriented). However, it has the feel of one with its

company photographs, foreword by BAT chairman Sir Duncan Oppenheim, and its

mostly favourable view of BAT's management and development. Generally, Global

Cigarette shows both the strengths and weaknesses of much current business

history writing: on the one hand, painstaking research and careful of

analysis of a wide range of sources dealing with a major industry; on the

other, too much detail for most readers, a preoccupation with multinationals

and management (can't business historians write about anything else?), and

arguably not sufficiently distanced from big business. The book has been

supported by BAT's public relations department and Cox strikes a sympathetic

note when crediting an industry that he says has been obliged to become

instinctively suspicious and defensive, arguing that BAT's support represents

an "extraordinary act of faith." BAT, of course, is well known for its

largesse to worthy academic causes (not least its eyebrow-raising sponsorship

of the Association of Business Historian conference at Cox's university in

1999), but it is easy to see why it would be pleased with this effort. It

does not discuss anything controversial. BAT is the subject of intense

interest at present, both for its activities in China (where it has been

alleged that the company has smuggled cigarettes), the nature of its

relationship with Brown & Williamson, and the status of its archive at

Guildford, where lawyers and historians are afforded only the most carefully

controlled access. Cox has written an interesting and detailed book, but he

would have found a much wider market for his skills if he had engaged with a

historical time-frame that took in some of these more recent developments.

Geoff Tweedale is a Reader in Business History in the Business School at

Manchester Metropolitan University. His major current research interests are

the history of health and safety in British industry. He has just published a

book on this topic, Magic Mineral to Killer Dust: Turner & Newall and the

Asbestos Hazard (Oxford University Press, revised paperback edition,

2001). His current interests include the history of health and safety in

British industry.