http://www.economistpakistan.com/news/INDUSTRY_2.jpg Industry – The manufacturing of goods in a factory Globalization has changed focus, location Maquiladora – Factories built by U.S. companies in Mexico Near the border Lower labor costs Consumers: price is more important than origin http://media.web.britannica.com/eb-media/42/100842-004DCCD2AEC.jpg Industrial Revolution – Improvements in industrial technology that transformed the process of manufacturing goods N. England/Scotland in the late 1700s Replaced cottage industries (home-based manufacturing) http://www.historyhome.co.uk/pict2/cottind.jpg Key: steam engine (1769, James Watt) Could concentrate whole process in one building Industries impacted: iron, coal, transportation, textiles, chemicals, food processing Result: high productivity, better living standards http://3.bp.blogspot.com/_8-z-DJhoXIQ/SwnfZk23wI/AAAAAAAACJ4/AyTCkhzRAkw/s1600/WattSteamEn gine.jpg ¼ of world’s industrial output Emerged during the 1800s/early 1900s Key areas: United Kingdom Rhine-Ruhr Valley (most important area, iron/steel) Mid-Rhine (Germany) Po Basin (Italy) http://homepage.smc.edu/buckley_alan/ps7/europe_industry_1850a.gif N.E. Spain (fastestgrowing, focus: textiles) Moscow (fabrics) St. Petersburg (shipbuilding) Volga (petroleum, natural gas) Urals (minerals) Kuznetsk (coal/iron) Donetsk (Ukraine, coal, iron, natural gas) Silesia (Poland, steel) http://imgfotki.yandex.ru/get/4515/154814723.0/0_6065b_b82a631d_XL.jpg Arrived later, but grew faster than in Europe Focus: N.E. U.S., S.E. Canada Regions: New England (oldest, textiles) Middle Atlantic (largest) Mohawk Valley (food processing) Pittsburgh/Lake Erie (steel) Western Great Lakes (cars) S. California (clothing) S.E. Ontario (steel, cars) http://www.blogcdn.com/www.autoblog.c om/media/2010/06/x08buen091.jpg Key resource: people Japan Growth – 1950s/1960s Focus: motor vehicles, electronics China Largest supply of low-cost labor Focus: textiles, steel, household goods 1990s - allowed transnational companies in, led to rapid economic growth http://www.carztune.com/wp-content/uploads/2011/05/Japaneseauto.jpg http://m.b5z.net/i/u/10032028/i/2948863.jpg The transport of materials to and from a factory Key factor in determining why industries locate in particular places Goal: minimize cost of transporting inputs (parts/resources) to factory, and finished goods to consumers http://us.123rf.com/400wm/400/400/anzav/anzav0611/anzav061100192/5 94631-the-motor-vehicle-transports-trees-on-a-factory.jpg Industry in which inputs weigh more than the final product Example: Copper Several steps in production (mining, smelting, refining) Need economical energy source for most steps 2/3 of U.S. copper comes from Arizona (proximity to mines is most important) http://www.mining-technology.com/projects/bingham/images/bing9.jpg Example: Steel Manufactured by removing impurities and adding elements (manganese, chromium) Steel mills have been replaced by minimills, which use scrap metal Proximity to markets is now more important than inputs http://menofsteelrecycling.com/steelplant.jpg Making something that gains volume or weight during production Example: fabricated metals Brings metals together and transforms them into a complex product Most plants locate near markets due to shipping costs http://www.feida-usa-supply.com/Fabricated%20Metal%20Parts.jpg Markets for fabricated metal: TVs, refrigerators, air conditioners, motor vehicles Beverage production Empty cans/bottles are filled with liquid, shipped to consumers Weight adds to shipping costs, so plants are located near markets http://www.theepochtimes.com/n2/images/stories/large/2009/04/30/cc73 486687.jpg Single-Market Manufacturers Specializers with only 1- 2 customers Ex. Motor vehicle parts Perishable Product Manufacturers Ex. Bread, milk, newspapers Both industries must locate close to customers http://goldcountryprint.com/index_htm_files/animatedpress.gif Truck – short-distance, best for one-day delivery Train – Longer distance, no need for stops Ship – Low cost, crosscontinental Air – High cost, for small, high-value packages Break-of-Bulk Point Location where transfer of travel modes is possible Cost rises with additional break-of-bulk points http://roguemedia.org/wp-content/uploads/2012/02/Container-Ship.jpg http://archdoc.mr926.me/pics2/1212/2011070112124916305.jpg The unique characteristics of a location Three traditional production factors: Labor Land Capital http://edu.glogster.com/media/5/18/66/99/18669985.jpg The most important site factor Labor-intensive industry Industry in which wages and other compensation paid to employees constitutes a high percentage of company expenses Found mainly in LDCs http://www.fibre2fashion.com/_resources/industryarticles/24/2398/1_files/image002.jpg Example: textiles (woven fabrics) Step one: spinning Done mainly in LDCs (China = 2/3 of cotton thread) Synthetic fibers used in recent years (rayon, nylon, polyester) Child labor is commonly used http://www.cctv.com/english/20090205/images/1233820679619_1233820 679619_r.jpg Weaving 93% of weaving is done in LDCs Low labor costs offset shipping costs Assembly 4 types of products (garments, carpets, home products, industrial products) Assembled close to consumers (in MDCs) http://www.adhesives-equipment.com/partners/forbo/Bild-BondingSystems.jpg New factories need lots of space (one-story facility) Likely location: suburban or rural sites Proximity to major highways is most important Past: railways Present: Semi-trucks http://www.business-in-asia.com/images/hemaraj3.JPG Environment Mild climates, year- round activities can also influence site selection Also: access to affordable electricity ▪ Ex. Alcoa ▪ World’s largest aluminum producer ▪ Relies heavily on hydroelectric power ▪ Constructed its own dams to produce power http://3.bp.blogspot.com/_2mF3zJKEu1E/TGyb8IG4TvI/AAAAAAAAE6c/oJv RRdfNvPk/s1600/045.JPG Key source: borrowed money Industries located near available capital ‘Auto Alley’ – Michigan, Indiana, Illinois Silicon Valley – California (1/4 of all U.S. capital is spent here) LDCs have great difficulty obtaining capital http://www.zillow.com/blog/images/sanmateotosanjose_1.gif