Where in the United States are car assembly plants and parts makers distributed, and why?

Question

What will be an ideal response?

Answer 1

Answer: In the U.S., vehicles are fabricated at about 50 final assembly plants, from parts made at several thousand other plants. Most of the assembly and parts plants are located in the interior of the country, between Michigan and Alabama, centered in a corridor known as "auto alley" formed by north-south interstate highways 65 and 75. For a bulk-gaining operation, such as a final assembly plant, the critical location factor is minimizing transportation to the market.

If a company has a product that is made at only one plant, and the critical location factor is to minimizing the cost of distribution throughout North America, then the optimal factory location is in the U.S. interior rather than on the East or West Coast. Most parts makers also locate in auto alley to be near the final assembly plants. Seats, for example, are invariably manufactured within an hour of the final assembly plant. A seat, like most bulky parts, is an especially large and bulky object, and carmakers do not want to waste valuable space in their assembly plants by piling up an inventory of them.

Within auto alley, U.S.-owned carmakers and suppliers have clustered in Michigan and nearby northern states, whereas foreign-owned carmakers and parts suppliers have clustered in the central and southern portions of auto alley.