Industry Chapter 11

Industrial Revolution Cottage industry – Iron – Coal – Transportation – Textile – Chemicals – Food processing

Europe

Western Europe United Kingdom – Industrial Revolution – Lost international leadership in the 20 th century – Attracted high-tech industries, serving the European – Industries located in E/SE England Rhine-Ruhr Valley – Belgians led the way in coal mining – French opened the first coal- blast furnaces for iron making – Germans opened first industrial cotton mill – Political problems stopped development of modern transportation – Most industrial areas lie in NW Germany – Iron & steel manufacturing due to closeness of coal fields

Mid-Rhine – Europe’s most centrally located industrial area – Frankfurt – financial & commercial center & hub of Germany’s transport network – Stuttgart – high-valued goods that require skilled labor – Mannheim – inland port, large chemical industry, synthetic fibers, dyes & pharmaceuticals

Po Basin – Numerous workers willing to accept low wages – Inexpensive hydroelectricity – Attracted textiles & other industries Northeastern Spain – Fastest growing late 20 th century – Catalonia centered on the city of Barcelona center of Spain’s textile industry – Country’s largest motor- vehicle plant

Eastern Europe Moscow – Russia’s oldest industrial region – Centered around country’s capital & largest city – Despite few resources, skilled labor to produce linen, cotton, wool & silk St. Petersburg – Second-largest city – Specializing in ship building – Other industries that serve the navy & ports in the Baltic – Processed foods, textiles & chemicals

Urals – Contain world’s most varied collection of minerals – 1,000 types of minerals – Attracted steel, chemicals, machinery & metal fabricating plants Volga – Contains largest petroleum & natural gas reserves

Kuznetsk – Most important manufacturing district east of the Urals – Largest reserve of coal & large supply of iron ore Dontetsk – Eastern Ukraine – World’s largest coal reserves

Silesia – Europe’s most rapidly growing industrial area – Skilled & low-paid workforce & proximity to wealthy markets in western Europe

North America

New England – Cotton textiles early 19 th century – Imported from southern states & finished product shipped to Europe Middle Atlantic – Largest US market – Attracts industries that need large proximity to large number of consumers – Foreign trade through region’s large ports

Mohawk Valley – Linear industrial belt in upper New York State – Advantage inexpensive electricity generated by Niagara Falls Pittsburg-Lake Erie – Was leading steel- producing area in 19 th century – Proximity to Appalachian coal & iron ore

Western Great Lakes – Chicago – hub of the nation’s transportation network – Now, center of steel production Southern California – Largest area of clothing & textile production – Second-largest furniture producer – Major food-processing center

Southeastern Ontario – Canada’s most important industrial area – Central to Canadian & US markets & near Great Lakes/Niagara Falls

Asia

Japan – Became and industrial power in 1950s & 1960s. – Initially by producing goods that could be sold in large quantity at cut- rate prices to consumers in other countries – Centered between Tokyo & Nagasaki China – Seconds-largest supplier of low-cost labor & is world’s largest market for many products – Three areas: Hong Kong, Yangtze River & Gulf of Bo Hai

South Korea – Began an export- oriented manufacturers – Ocean going ships – Centered along the rim between the capital & second-largest city Seoul and Busan the largest port

Section 2 Why do Industries have different distributions?

Situation Factors Proximity to inputs – Optimal plant location is as close as possible to inputs is the cost of transporting raw materials to the factory is greater than the cost of transporting the product to consumers Proximity to markets – Optimal plant location is as close as possible to the customer is the cost of transporting raw materials to the factory is less than the cost of transporting the product to consumers

Nonmetallic minerals – 90% of metals humans use are nonmetallic – Building stones, diamonds, minerals used to manufacture fertilizers: nitrogen, phosphorus, potassium, calcium & sulfur Metallic minerals – Valuable for fashioning machinery, vehicles & other essential elements of contemporary society – Malleable – Ductile – Conductors – Metals are capable of combining to form alloys that have distinct properties for industry

Ferrous – Contains iron (Latin for the word iron) – Extracted from iron ore, the world’s most widely used ore – Fashioning iron 4,000 years ago Chromium Manganese Molybdenum Nickel Tin Titanium Tungsten

Nonferrous metals – Used to manufacture products that don’t contain iron & steel Aluminum Copper Lead Lithium Magnesium Zinc Precious metals Rare earth metals

Situation Factors: Proximity to Markets Bulk gaining – makes something that gains volume or weight during production – Fabricated metals – Beverage production

Single Market Manufacturers Specialized manufacturers with only one or two customers Optimal location for factories is close proximity to customers

Perishable Products To deliver as rapidly as possible must be located as close to markets as possible – Bread – Cheese – Butter – Daily newspaper Electronic delivery has led to the decline in print publishing jobs – 1 million to 800,000 and Internet publishing jobs has increased from 70,000 to 80,000

Ships, Rail, Truck, Air? The further something is transported the lower the cost per kilometer (mile) Longer distance transportation is cheaper per kilometer because firms must pay workers to load goods on & off vehicles whether the material travels 10 or 10,000 kilometers Cost per kilometer decreases at different rates for the different modes

Ship, Rail, Truck or Air? Trucks – Most often used for short distance – Can be loaded and unloaded quickly – Advantageous is the truck driver can reach destination within one day Trains – Often used to reach destinations that take more than a day – East & West coast in US – Take longer than trucks to load and unload – Once on the way they do not need to take rests like trucks

Ships – Used for long distance – Cost per kilometer is very low – Slower than land based transportation Air – Most expensive for all distances – Used for speedy delivery of small-bulk, high- valued packages

Break of Bulk Regardless of transportation mode, cost rises each time that inputs or products are transferred from one mode to another Companies may calculate that the cost of one mode is lower for some inputs & products where another mode may be cheaper for other goods Many companies that use multiple transports must calculate break of bulk – location where transfer among transportation modes is possible These are seaports, airports

Copper: Proximity to Inputs or Markets 1.Mining – bulk reducing, most of ore extracted is gangue. In North America, copper ore mined is low grade 0.7% copper 2.Concentration – crush & grind into fine particles, mix with water, chemicals filter & dry. 25% copper. Concentration mills are located near mines

3. Smelting – Concentration becomes input for smelters which remove impurities – Another bulk-reducing industries and smelters are built main inputs to minimize transportation costs 4. Refining – Purified copper from smelters is refined to produce copper cathodes 99.99% pure copper – Refineries are located near smelters

Steel: Changing Inputs Steel is made by removing impurities in iron such as silicon, phosphorus, sulfur & oxygen Bulk-reducing industry traditionally located it facilities because of situation factors. Two changes – Change in relative importance of main inputs – Increasing importance of proximity to markets rather than proximity to inputs

Changing Distribution of the US Steel Industry 1.Mid 19 th Century – Southwestern Pennsylvania 2.Late 19 th Century – Lake Erie 3.Early 20 th Century – Southern Lake Michigan 4.Mid 20 th Century – East & West Coasts 5.Late 20 th Century – Proximity to markets

Motor Vehicle: Changing Markets Global distribution – Assembled at plants using thousands of parts supplied by independent companies – Three regions include 10 carmakers that control 85% of world sales Two in North America – GM & Ford Four in Europe – Germany(VW), Italy (Fiat- Chrysler), France (Renault- Nissan& Peugeot) Four in East Asia – Japan (Toyota, Honda & Suzuki), South Korea (Hyundai) Regional distribution of vehicle production – North America – assembly & parts plants located in interior US between Michigan & Alabama – Corridor known as “auto alley” formed by north-south interstate highways 65 & 75

Europe – East-West corridor between UK & Russia – Germany is the leading producer in Europe – Since the end of communism east Europe has seen a large increase in production

East Asia – Clustered in the east near major population centers – Most car buyers in China are in large cities

Site Factors Labor

Capital Land

Textiles and Apparel: Changing Inputs

Weber: Least- Cost Theory Alfred Weber Optimum location where cost of transporting raw materials to factory & finished goods to market at their lowest

1.Area is completely uniform physically, politically, culturally & technologically 2.Manufacturing involves a single product to be shipped to a single market whose location is known 3.Inputs involve raw materials from more than one source 4.Location is infinitely available but immobile in location 5.Transportation routes are not fixed but connect origin & destination by shortest path. Transport costs directly reflect the weight of the item shipped & the distance they are moved

Hotelling Model Economist Harold Hotelling ( ) Wanted to understand the issue of locational interdependence