Austro-Italian ironclad arms race
Seizing upon the decline of the Regia Marina in the years immediately after the Battle of Lissa, Tegetthoff worked to continue the efforts of Archduke Ferdinand Max of expanding the ironclad fleet of the now Austro-Hungarian Navy. Tegetthoff found political allies in the Austro-Hungarian Minister of War Carl von Franck and retired Admiral Bernhard von Wüllerstorf-Urbair. Wüllerstorf's and Franck's primary arguments in favor of continuing with the ironclad program Austria had engaged in prior to the Seven Weeks War lay largely along economic grounds. The two believed that constructing new ironclad warships would rejuvenate Austria-Hungary's economy following the defeat at the hands of Prussia and Italy, and that such a fleet would help to open up new commercial opportunities in the Levant and the Middle East. These proposals would be shelved however while Austria continued to reel from the military defeats inflicted by Prussia, and several cabinet reshufflings by Emperor Franz Joseph I resulted in a government more interested in pursuing revenge against Prussia than constructing new ironclads, which would be of little use in a hypothetical second war with Prussia.
Austro-Hungarian Armed Forces
Prussia established its domination over other German states by its victory over Austria in the Seven Weeks' War in 1866. The critical battle was waged at Königgrätz (Hradec Králové in the present-day Czech Republic). The Austrians armed with muzzle-loading rifles sustained 20,000 casualties and lost 20,000 prisoners. The battle overshadowed Austria's victories over Prussia's Italian allies at Custoza and in the naval Battle of Lissa (Vis) off the Dalmatian coast in which a smaller Austrian fleet of ironclads overcame the Italians by ramming them. Following the end of the Seven Weeks' War, Austria experienced fifty years of peace until World War I broke out in 1914.