That stems from a time, when the normal "Ihr" (plural 'you') was considered somehow "reserved" for nobility, so for "normal" people, one resorted to "Er" ('he') / "Sie" ('she') as a polite form for singular 'you', with the corresponding plural "Sie" ('they') even more polite. Nowadays we are using plural "Sie" nearly exclusively.

The French were able to stay with 'tu'/'vous' because they abolished their nobility instead ; -)