Industrialization
Key Issue #2: “Why Do Industries
Have Different Distributions?”
It’s All About PROFIT!
• Industry seeks to maximize profits by
minimizing production cost
• Geographers try to explain why one
location may provide more profit than
another
• Two geographical costs:
– Situation – transporting materials
– Site – land, labor, and capital
Situation Factors
• Definition – transporting materials to and
from the factory
• Objective – minimize the costs
• For some companies, this is the most
important factor in choosing a location
If you were building a car manufacturing
plant in the U.S., where would you locate it?
Proximity to Inputs
• Every industry needs either resources from
the physical environment or parts/materials
made by another company
• Weight of the material is a factor for
choosing location
Example: Copper Industry
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First Step: Mining the copper ore
Gangue
Bulk-reducing Industry
Concentration mills must be near mines
Purified copper is then treated at refineries
Source of energy
Example 2: Steel Industry
• Also a bulk-reducing industry
• Choose location to minimize the cost of
transporting inputs
• Steel is an alloy of iron that is produced by
removing impurities in iron
Origin of Steel Industry
• Production was small until
the Industrial Revolution
• The constant heating and
cooling of steel required
strength, skill and a lot of
time
• The Watt Steam Engine
More advances in the steel industry
• Henry Cort
– Puddling – reheating iron until pasty, then
stirring it with iron rods until impurities are
burned off
– Rolling – passing iron between rollers to
remove remaining scum
• Abraham Darby – produced high quality
iron smelted with purified carbon made
from coal, known as coke
– Result – the iron industry needed to be near
coalfields
U.S. Steel Industry
• In the mid 19th Century – the U.S. steel
industry was concentrated around
Pittsburgh
• In the first half of the 20th Century – steel
mills were built near the coast
– Baltimore, L.A., Trenton
Changing U.S. Steel Industry
• Recently, many steel plants have closed
• Survivors – southern Lake Michigan, East
Coast
• Successful steel mills are located close to
markets
• Mini-mills
Proximity to Markets
•
Transporting goods to consumers is an
important locational factor for three
industries:
1. Bulk-gaining
2. Single market
3. Perishable
Bulk Gaining Industries
• Gain weight during production
• Example: soft drink bottling
• Coca-Cola has bottling plants all over
Fabricated Metals and Machinery
• This is a prominent example of a bulk
gaining industry
• A fabricated-metals factory brings together
parts to make a more complex product
• Examples: TVs, refrigerators, air
conditioners, and cars
Location of Car Manufacturing
• Historically – near large markets
• Recently – assembly plants focus on
producing a single model rather than
locating near all large markets
The Ford Plant in ATL (#6) has closed
Single Market Manufacturers
• Products are sold primarily in one location,
so they cluster near the market
• Example: the manufacturers of automobile
parts only sell to a couple of customers
(GM, Toyota)
• Parts makers ship their products directly to
assembly plants
• “auto alley”
Perishable Products
• Products must be delivered to consumers
ASAP!
• milkshed
Ship, Rail, Truck, or Air
• Trucks – used for short distance
• Trains – longer distances
• Water – if available, is attractive for long
distances
• Air – the most expensive, but more firms
are using the air for speedy delivery
Break-of-Bulk Points
• Cost rises each time inputs are transferred
from one mode to another
• Sometimes – the cost for one mode is lower
for inputs and expensive for products, so
companies locate at a “break-of-bulk” point
where transfer among transportation modes
is possible
– Seaport, airport
Site Factors
• Definition = the unique characteristics of a
location
• Land, labor, and capital are the three
traditional production factors that vary
among locations
• The most important site factor on a global
scale = labor
• Minimizing labor cost is VERY important
for some industries
Labor
• Labor-intensive industry – one in which labor
is a high percentage of expense
• Some need highly skilled, expensive labor
• Labor intensive is not the same as “highwage”
• Textile and clothing industries – require less
skilled, low cost workers
– 3 steps: spinning, weaving, and cutting/sewing
– All are labor intensive, but not equally so
resulting in global distributions that are not
identical
Textile and Apparel Spinning
• Because it is labor intensive, it
is located in low-wage
countries (PINGs)
• PINGs account for ¾ of the
world’s spinning production
• Located where cotton is grown
• The U.S. is the only PED that
is a major thread producer
• Synthetic fibers – ½ is grown
in PINGs
Textile and Apparel Weaving
• Labor is even more intensive
• Especially highly concentrated in low-wage
countries: 86% of the world’s woven cotton
factory is produced in PINGs
• China accounts for ½ of production
• India accounts for ¼ of production
Textile and Apparel Assembly
•
Textiles are assembled into four main types of
products
1.
2.
3.
4.
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Garments
Carpets
Home products
Industrial uses
Most of the 80 billion articles or clothing sold
worldwide is made in Asia
– 3/4 of shirts
– ½ of dresses and suits
– Most of the underwear and lingerie
•
Europeans and North Americans produce
woolens
Land
• Most efficient – one story building = more
land
• Land is cheaper in suburban or rural areas
than in the city
• Industries are attracted to energy sources,
low electrical rates, and amenities at the site
Capital
• Manufacturers typically borrow funds to
establish new factories or expand existing
ones
• Silicon Valley – capital
• Financial incentives
• The ability to borrow money in PINGs