Key Issue #1 & #2 CHAPTER 11: INDUSTRY

Transcription

1 Key Issue #1 & #2 CHAPTER 11: INDUSTRY

2 Key Issue #1 Where is Industry Distributed

3 Manufacturing Huffy, Etch a Sketch, & Maytag China -Huffy wages went from $10 to $0.25 -Ave. $$ of bike from $80 to $40 Maquiladora = Industrial plants located just over the U.S. border in Mexico -Lenient wage and environment regulations - Raw materials from U.S. - Products back to U.S. 2 Critical Factors for Determining Location of a Factory: -Where the markets are -Where the resources are located A series of improvements in industrial technology that transformed the process of manufactured goods. NW Europe, E. Europe, E. Asia, and Eastern North America -Brazil and India are leading industrial producers outside these regions.

4 Industrial Revolution Industrial Rev. series of improvements in technology that transformed man. Process -Cottage Ind. home based manufacturing (pre-ind. Rev.) -Steam Engine (Watt, 1769) most important to factory development -Industries impacted by Ind. Rev. -Iron - first to benefit from steam engine (engine provided heat) -Coal - needed to operated the ovens and steam engines -Coal replaced wood as main energy -Transportation first canals, then railroads. (Euro rail delayed by political difficulties btwn. States) List how the Industrial Revolution changed the world? -Textiles went from thread spun at home on wheels operated by hand to mills placed in factories near flowing water (water = power) -Chemicals first created to bleach and dye cloth (1746) -Food processing essential to feed factory workers no longer on farms -Canned food (1810)

5 United Kingdom -1/2 of cotton and iron and 2/3 of coal production during 1800 s -Industrial Revolution originated in northern England and southern Scotland -Lost industrial lead in 20 th century -Deteriorating facilities and didn t receive U.S. support after WWII Has expanded into high-tech industries -Less taxes on businesses, reduced gov t regulations, promote private ownership -Industries today located in SE England, near London (Chunnel) How did the UK go from being a dominate player in the Industrial Revolution to an almost nonexistent participant?

6 Western Europe Rhine-Ruhr Valley Focused around Germany Rhine Ruhr rivers -Rhine-Ruhr Valley (most important in Europe/central) -Important for iron and steel manufacturing -Political instability delayed diffusion of Industrial Rev. -French rev., Napoleonic Wars, delayed railways -Industry currently dispersed more than concentrated. Rotterdam is largest port in world Mid Rhine 2 nd most important industrial area -Consumer market biggest asset Frankfurt is transportation hub. Stuttgart has Mercedes and Audi France and Lux. have steel

7 More European Northern Italy (Po River Basin) S and E Europe joined Ind. Rev. 20th cent. -Attracted textiles, parts assemblers, and material processors b/c of cheap labor and hydroelectric power from alps. NE Spain Catalonia (Barcelona) -Fastest growing late 20th century -Textiles and Auto (2nd in Europe) Eastern Europe (Russia and others) -Central Industrial District is oldest region centered around Moscow -St. Petersburg specializes in ships -Volga has petro/car industry -Ural contains minerals but lacks energy -Kuznetsk created by Soviets -Eastern Ukraine contains lots of coal -Silesia is outside former Soviet Republics (Poland, Czech Rep.) and produces steel

8 North American Regions 2 nd in world by 1860 (UK 1 st ) -Did not begin manufacturing steel until last 1/3 of 19 th century -Main industrial area is in NE US -First area of settlement led to early establishment of infrastructure. -Good supplies of iron and coal -Great Lakes and rivers provide good transportation (Erie Canal and St. Lawrence Seaway) -New England (textiles and skilled labor) -Mid Atlantic Largest market, financial, communications, and entertainment industries - Mohawk Valley Steel and food, inexpensive electricity, aluminum, paper, and electrochemical industries -Pitts.-Lake Erie is known for steel leading area

9 North American Regions -Western Great Lakes Hub of countries transportation network. -Chicago is a major transfer point -Auto industry took advantage of this in Detroit -Machine tools, transportation equipment, clothing, furniture, ag. machinery, and food products. -Southern California -Leading ind. area outside northeast -Largest area of textile in U.S. -2 nd in furniture and big in foods PAIR & SHARE Why did regions specialize Why did those specializations change over time?

10 U.S. REGIONS NAME OF REGION RELATIVE LOCATION (states) BEST RESOURCES / ASSETS / STRENGTHS PRIMARY INDUSTRIES / BUSINESSES New England Oldest industrial area flows north from Boston Skilled labor / imported cotton from South textiles Mid Atlantic Extends south from New York City, Philadelphia, to Baltimore Large population/ market size Foreign trade, financial trade, Western Great Lakes Extends from Detroit and Toledo, Ohio on the East to Chicago and Milwaukee on the west. Transportation hub/ able to facilitate movement of goods to people in interior of country Auto industry/ transportation industries/ food industries

11 U.S. Regions Pitts/Lake Erie Concentrated in area near Pittsburgh and Cleveland Iron ore/ coal materials/ Nations most important steel producing area in 19 th century. Mohawk Valley Linear industrial belt in upper New York State along Hudson River and Erie Canal and Lake Erie Inexpensive abundant power from Niagara Falls Steel and food producing, aluminum, paper, and electrochemical Southern California Los Angeles largest area outside of NE WWII 1/3 of aircraft production clear skies/ mild winters Textile/ furniture production Latin/Asian immigrants

12 Southeastern Ontario Most important industrial area -central to U.S. and Canadian markets -near to the Great Lakes & Niagara Falls -most steel production: Hamilton, Ontario -auto assembly: Toronto -inexpensive electricity: Aluminum, paper, flour, textile, sugar refining

13 East Asia -Labor force is biggest asset -Japan paid low wages and to provide cheap products -Later used profits to train workforce to become one of the highest skilled in the world -Now leading producer of autos, stereos, cameras, TVs, ships -Taiwan and South Korea also took advantage of labor force to provide cheap products - China has largest manufacturing labor force in world and is the largest market for many consumer products. -textiles, apparel, steel, many household products How did Japan make the transition from a manufacturer of cheap good to high priced specialized goods?

14 Key Issue #2 Why Are Situation Factors Important

15 Situation Factors 2 Geographical Costs: Site & Situation Situation Factors - transporting materials to and from a factory Inputs = resources -Firms seek locations that minimize cost of transporting inputs to the factory and finished goods/products to consumers to REDUCE cost of product! -Proximity to markets (Bulk-gaining) and proximity to inputs (Bulk-reducing) Copper Mining bulky ore is mostly waste (.7%). Concentration uses process to create copper concentrate transform into more valuable product per weight. Smelting concentrated copper input for smelters removes impurities. Refining produces copper cathodes not bulk reducing less critical location COPPER BULK REDUCING

16 Cost vs. Location Farther distance = More $$$ -Weber s Least Cost Theory or model of industrial location -Firms consider transportation costs, agglomeration costs, and labor costs. -Paper mills vs. soft drinks -What costs more, inputs or finished products? How do costs of transportation of resources and getting goods to market affect the cost of item?

17 Steel Economical energy sources vital to energy demanding operations - Steel inputs = iron ore & coal Demonstrates that when the source of inputs of change, the optimal location changes Source has changed many times because of change of inputs. Mid 19 th = Pittsburgh (still core for research) Late 19 th = around lake Erie moved b/c of iron ore found in Mesabi Range (Minnesota) Early 20 th = so. end of Lake Michigan more iron ore needed in process plants moved

18 Steel New U.S. steel mills located near East & West Coasts (i.e. Baltimore, Los Angeles, etc.) more changes in transportation cost - iron ore coming from other countries more use of scrap Most steel mills closed in U.S. survivors located around so. Lake Michigan & along E. Coast - Proximity to market vital Minimills ¼ of U.S. market main input scrap metal 1 step process How do change of inputs affect the construction of new factories? Why is this such a vital factor?

19 Proximity to Market Important for 3 Types: Bulk-gaining Single market Perishable -Fabricated metals - Fabrication of parts and machinery from steel & other metals - largest market auto industry must be located nearer consumer -Most auto assembly plants are located in the interior of the U.S. bwn Michigan and Alabama auto alley near north-south highways - Soda Cans / Water weight of finished product heavier than empty higher cost to transport - water easy to find.

20 Bulk-gaining Industry Single-market = specialize in product for 1-2 customers must be close to customer. Ex. Producer of parts for autos optimal location important for justin-time delivery Perishable products must insure rapid delivery for fresh products close location. Newspaper non food perishable item decline because of electronic device more timely with news. Why must bulk-gaining industries be located near to their markets? What are the factors that make this necessary?

21 Shipping Shipping cheaper per km b/c workers must load & unload no mater how far something travels. Amount decreases per km at different rates b/c each type of transport has different expenses. Shipping Types: Ships long distance cost per km is very low, slower than land based. Trains longer than one day btwn east and west coast. Trucks short distance delivery, faster loading/unloading. Air fastest and most expensive.

22 Shipping Containerization = Containers (steel box) may be packed on a ship, rail car, or back of semi easily moved btwn modes of transport Break-of-Bulk = location where transfer btwn transportation modes is possible good spot for firm using multiple modes Seaports to airports/seaports to railways.

23

24

25