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 Navy
By the time the Seven Years' War began in 1756, Austria still lacked a proper navy. English pirates and privateers, as well as Barbary corsairs severely hampered Austria's merchant marine, to the point that most of Austria's sea trade had to be conducted in foreign ships. The lack of any naval force to protect Austria's shipping led Count Kaunitz to push for the creation of a small force of frigates to protect the Adriatic Sea. However, the Seven Years' War forced Vienna to pay much more attention to Austria's land border with Prussia and its coastline along the Adriatic Sea, preventing Kaunitz's program from achieving success.