Since 1965 the American automobile industry has been reconcentrating in the Midwest. Situation and site costs are crucial factors in this evolving pattern. Preferred factory sites are locations that have no previous association with the industry and have access to railroad, interstate highway, and air transportation. SIGNIFICANT change that is the consequence of site selection for new assembly plants has been occurring in the American automobile industry. After a fifty-year period of decentralization, the Midwest again is the preferred location for most of these new plants. Between 1965 and early 1986 all fifteen sites for new automobile assembly plants were in the Midwest in contrast with a figure of four out of fifteen erected there during the preceding twenty-year period. Thirteen of the new midwestern plants have been opened or designated since 1979. The purpose of this article is to analyze this renewed concentration of the automobile industry in the Midwest in terms of the geographical factors that underlie the new pattern. Two types of geographical costs are involved in selecting a specific location: situation costs and site costs. The former are related to the transportation of materials into and from a factory. Firms seek a location where the aggregate costs of bringing materials to a factory and of transporting the finished product to market will be minimized. The optimal location is dependent on the relative costs of transporting the needed inputs and outputs. Changing situation costs are instrumental in the renewed concentration of assembly plants in the Midwest. Site costs result from operating under the specific conditions of a particular location. Examples of site costs are labor, energy, amenities, and taxes. Although situation costs have brought automobile manufacturers back to the Midwest, site factors explain the choice of midwestern locations not traditionally associated with motor-vehicular production, especially since the late 1970s. CHANGING DISTRIBUTION OF PLANT SITES Locational patterns of automobile-assembly operations in the United States have alternated between concentration and dispersal. Four eras can be identified. The first was a ten-year period, beginning in the mid-1890s, when commercial production of automobiles started in factories dispersed * DR. RUBENSTEIN is an associate professor of geography at Miami University, Oxford, Ohio 45056. This content downloaded from 207.46.13.64 on Sat, 03 Sep 2016 04:07:31 UTC All use subject to http://about.jstor.org/terms AMERICAN AUTOMOBILE INDUSTRY throughout the Northeast.1 That manufacturing was concentrated in southern Michigan during the next decade.2 The third period, extending from 1914 to the mid-1960s, was characterized by decentralization of factories from southern Michigan to many other parts of the United States. The fourth period is the current one, marked by renewed investment in facilities in the Midwest (Fig. 1). The beginning of this period can be dated from 1966, when automobileassembly plants were opened at Lordstown, Ohio, by General Motors and at Belvidere, Illinois, by the Chrysler Corporation. The new trend was strong in the late 1970s and early 1980s. General Motors initiated assembly operations at Lake Orion, Michigan, Wentzville, Missouri, Bowling Green, Kentucky, and Oklahoma City, Oklahoma. The Chrysler Corporation started them at Sterling Heights, Michigan, Volkswagen at Westmoreland, Pennsylvania, Nissan at Smyrna, Tennessee, and Honda at Marysville, Ohio. In 1986 two other plants were under construction: Poletown on the Detroit-Hamtramck border by General Motors, and Flat Rock between Detroit and Toledo by Mazda. Finally, three sites were selected by March, 1986 for future plant construction: Spring Hill, Tennessee, by General Motors; Normal, Illinois, jointly by Mitsubishi and Chrysler Corporation; and Georgetown, Kentucky, by Toyota. In sum, the Midwest was the area selected for the fifteen assembly plants built or started between 1965 and 1986 in the United States. Particularly important to the renewed areal focus for the industry was the fact that all thirteen such plants after 1979 were in the Midwest. Although fifteen new assembly plants were opened or started between 1965 and 1986, thirteen plants closed during the period. Nine of them were outside the Midwest. Three plants closed in the Los Angeles metropolitan area and one in San Jose, California, two in New Jersey, and one each in Louisville, Kentucky, Baltimore, Maryland, Hamtramck, Michigan, St. Paul, Minnesota, St. Louis, Missouri, Dallas, Texas, and Norfolk, Virginia. General Motors was responsible for four closings, the Chrysler Corporation for two, and the Ford Motor Company for seven.3 Production of trucks and minivans continued at five of the plants at which automobile assembly ceased. Hence operations stopped at eight assembly plants between 1965 and 1986: four in California, two in New Jersey, and one each in Michigan and Texas.