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11.1 The Industrial Revolution The Industrial Revolution: A series of improvements in industrial technology that transformed the process of manufacturing goods Widespread Social, economic, political inventions Diffused gradually Cottage industry: home-based manufacturing -in textiles: -early 1800s -- people would spin and weave in their homes -by mid-century, this industry became based in factories and mills © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.1 The Industrial Revolution TRANSFORMATION OF AN INDUSTRY © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.1 The Industrial Revolution JAMES WATT’S STEAM ENGINE © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.1 The Industrial Revolution Industries impacted by the Industrial Revolution: Iron Coal Transportation Textiles Chemicals Food processing © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.1 The Industrial Revolution IRON ORE SMELTING © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.1 The Industrial Revolution DIFFUSION OF RAILROADS © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.2 Distribution of Industry Three-fourths of the world’s manufacturing is clustered in three regions: -Europe -East Asia -North America These major industrial regions are divided into subareas © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.2 Distribution of Industry EUROPE’S INDUSTRIAL AREAS © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.2 Distribution of Industry RHINE-RUHR VALLEY © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

A minute-and-a-half look at Rhine River boat traffic -- busy?

11.2 Distribution of Industry EAST ASIA’S INDUSTRIAL AREAS © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.2 Distribution of Industry NORTH AMERICA’S INDUSTRIAL AREAS © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry Involve transporting materials to and from a factory Proximity to inputs -If inputs expensive to transport, factory will locate near inputs -If input transportation cost exceeds cost of transporting final product to customers, factory will locate near market © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry Bulk-reducing industry: An industry in which the inputs weigh more than the finished product Have a strong input orientation E.g., copper production Copper ore is heavy when mined so mills, which locate near the raw-material site, concentrate the copper by removing less valuable rock Potato chips © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry BULK-REDUCING INDUSTRY: COPPER © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry Bulk-gaining industry: An industry that manufactures something that gains volume or weight during production -beverage bottling -automobile manufacturing © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry BULK-GAINING INDUSTRY: BEER BOTTLING © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry Single-market manufacturers: Make products sold primarily in one location Cluster near markets -example: automobile parts cluster near to where automobiles are put together © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry SINGLE-MARKET MANUFACTURER: CAR PARTS © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry Perishable products: Must be located near their markets -example: milk © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.3 Situation Factors in Locating Industry PERISHABLE PRODUCT: MILK PRODUCTION © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.6 Ship by Boat, Rail, Truck, or Air? The farther something is transported, the lower is the cost per mile Airplanes -usually most expensive -reserved for speedy delivery Ships -attractive for very long distance -cost is very low Trains -usually to transport things over one day away -do not need to stop for rest breaks Trucks -short-distance delivery -easily loaded and unloaded © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.6 Ship by Boat, Rail, Truck, or Air? SHIP BY AIR © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.6 Ship by Boat, Rail, Truck, or Air? SHIPPING ROUTES © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

The World’s Largest Container Ship -- 2014

All Roads, Air, and Shipping Routes on Earth!

Air Cargo

Three-mile long train!

11.6 Ship by Boat, Rail, Truck, or Air? BREAK-OF-BULK POINT, PORT OF LOS ANGELES © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.6 Ship by Boat, Rail, Truck, or Air? Break-of-bulk points: A location where transfer among transportation modes is possible Facilitated by containerization Seattle as a break-of-bulk point © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.6 Ship by Boat, Rail, Truck, or Air? Just-in-time delivery: Shipment of parts and materials to arrive at a factory moments before they are needed -cars, computers -reduces wasteful inventory How is an iPhone made? © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.6 Ship by Boat, Rail, Truck, or Air? ELIMINATING INVENTORY © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.6 Ship by Boat, Rail, Truck, or Air? Just-in-time disruptions Labor unrest Traffic Weather © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.6 Ship by Boat, Rail, Truck, or Air? DELIVERY DISRUPTIONS © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.7 Site Factors in Industry Three Main Site factors that influence the location of a factory: Labor -Labor intensive industries: Wages and compensation constitutes a high percentage of expenses -Exceeds $30,000 paid to a worker in developed countries -Benefits add to the costs -Approximately $5,000 paid to a worker in developing countries In industries where parts are expensive and the product labor intensive, manufacturers will seek cheap labor -iPhones: parts made in Japan and Germany, but put together in China © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.7 Site Factors in Industry LABOR © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.7 Site Factors in Industry EARNED ANNUAL INCOME (MALES) © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.7 Site Factors in Industry COST STRUCTURE OF AN iPHONE © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.7 Site Factors in Industry Three Main Site factors that influence the location of a factory: Land -In past, factors were physically more vertically oriented and had an overall smaller footprint -Could locate in the city -Today, factories are physically more horizontally oriented and have a considerably larger footprint -Locate in suburbs or rural areas -Urban periphery locations are also attractive -Access to inputs and ability to ship finished products -Proximity to major highways important -Junction points are critical -Land is cheaper in the suburbs and rural areas as well © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.7 Site Factors in Industry LAND © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.

11.7 Site Factors in Industry Three Main Site factors that influence the location of a factory: Capital -Most manufacturers have to borrow capital -Location near funding sources is important -Silicon Valley (area around San Jose, CA, great tech manufacturing area) -One quarter of all U.S. capital is spent on new industries here -Even with two-thirds of all high-tech industries failing, Silicon Valley banks continue to lend to engineers with good ideas -Capital has become a critical factor to the location of industries in developing countries However, because of perceived and real financial risks, many banks in developed countries will not lend to proposed startups in developing countries

11.7 Site Factors in Industry CAPITAL © 2013 Pearson Education, Inc. © 2013 Pearson Education, Inc.