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.
Erzherzog Ferdinand Max-class ironclad
Both ships were still under construction at the outbreak of the Seven Weeks' War in June 1866; the shipyard workers quickly completed the vessels, albeit with old smooth-bore guns instead of the Krupp rifled breech-loaders that were intended. "Erzherzog Ferdinand Max" served as the flagship of the Austrian fleet under Rear Admiral Wilhelm von Tegetthoff. The two ships saw action at the Battle of Lissa in July 1866, where "Erzherzog Ferdinand Max" rammed and sank the Italian ironclad . This proved to be the turning point of the engagement, forcing the Italian commander, Admiral Carlo Pellion di Persano to withdraw. "Habsburg", however, was not seriously engaged during the battle. Neither ship received significant damage in the battle, and they spent the rest of the war patrolling the Adriatic against a possible sortie from the Italian fleet. After the war, the ships were disarmed and laid up.