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INDUSTRIAL
IN THE
FOURTH
.. a supplement
FEDERAL
RESERVE
BANK
EXPANSION
to tile
1950
DISTRICT
Annual Report
NEWER AND OLDER INDUSTRIES
AUTOS - THE "BIG
THREE"
INVADE THE FOURTH
INTEGRATION
CHEMICALS,
ATOMIC
3
•
DISTRICT.
ON THE OHIO
TITANIUM
RIVER
5
•
7
AND ZIRCONIUM
9
ENERGY DEVELOPMENTS.
INDUSTRIAL
RESEARCH
13
NEW FRONTIERS IN TRANSPORTATION
COMMUNITY
11
•
15
DEVELOPMENT.
LONG ESTABLISHED
17
INDUSTRIES CONTINUE
TO EXPAND IN THE FOURTH
DISTRICT
•
19
NEWER
AND
OLDER
INDUSTRIES
An outstanding feature of the year 1956 was the acceleration in
pace of business investment in new plant and equipment, as was noted
in the main body of this annual report.
The Fourth Federal Reserve District shared very largely in the
surge in industrial expansion. And this was no accident of a single
year. The vigorous momentum oj industrial expansion in this District has been
under way jor some years; many additional developments are in the
blueprint stage or beyond.
The state of Ohio is now the second state in the Union in respect
to the dollar values added to raw materials in the manufacturing
process. Within the Fourth District is employed one out of every 9
of the nation's manufacturing workers. One out of 8 of the dollars of
value added in the manufacturing process is added in the District.
These and other broad facts emerge from the latest Census of Manufactures, but they give little feeling of the forward drive of industry
in the District.
The richness of variety, as well as the magnitude, of industrial
expansion in the Fourth District has probably not yet been fully
realized by all members of the nation's business community-let alone
by the public at large. The pages which follow suggest at least some
of the most interesting facets of the expansion; the complete story
cannot be told in short compass.
Long known as a stronghold of heavy industry, the Fourth
District's place in such industries as steel, machinery, fabricated metal
products, rubber products and coal mining, continues to be assured.
Well over half of the industrial workers of the District are engaged
in the groups of enterprises suggested by the naming of such product
lines.
Except for the last two pages of this Supplement, however, attention is being purposely centered upon the newer industries. Some of
the latter-such as titanium, zirconium or atomic energy in its peacetime applications-can
be considered new industries, per se. Others
such as auto assembly (as distinct from parts manufacture) are relatively quite new to Fourth District locations. Still others, such as chemicals and aluminum, are industries which, although they have strong
historic roots in this District, have recently burgeoned here to such
an extent that note must be taken of their new place in the industrial
pattern of the District and of the nation.
3
Hamilton
Brownhelm
Elyria
Defiance
c/,d
i
land
Walto
Hills
Parma' T insburg
Brookpark
Lordstown
Mansfield
Lima
PLANTS OF THE "BIG THREE" AUTO MANUFACTURERS
IN THE FOURTH DISTRICT
(excludes
independent
parts manufacturers)
UNDER
CONSTRUCTION
BUILT
BEFORE 1950
Columbus
Canton
Warren
AUTOS-"THE
BIG THREE"
INVADE
The Fourth Federal Reserve District has
long been a stronghold of independent
auto parts and truck manufacturers as well
as the major supplier of such materials as
steel sheets, iron, and glass to the Detroitbased auto industry. In recent years the
District has been "invaded" en masse by
the Big Three automobile producers themselves; the newcomers have been welcome.
This story of the Big Three is not meant
to detract from the considerable expansion
undertaken by the established auto and
truck parts industry or new independent
concerns in the field.
The invaders have rolled over the District in three distinct waves since 1946.
Between that year and 1948, not less than
8 new plants owned by the major auto assemblers were put into operation. Chief
among these were installations to produce
ball bearings at Sandusky, sheet metal
stampings at Hamilton, chrome plated
parts at Elyria, gray iron castings at Defiance, and automatic transmissions in
Parma, adjacent to Cleveland.
The second wave brought 10 giant new
plan ts into production between 1950 and
1956. Included among these were automatic transmission plants at Toledo and
at Fairfax (near Cincinnati), two engine
plants in Brook Park (near Cleveland)
which are fed by an adjacent new foundry,
steel stampings at Pittsburgh, and a body
parts and subassembly plant in Mansfield.
The third wave, now nearing its crest,
involves four very large facilities under
construction and a fifth on the planning
boards. Sharonville, near Cincinnati, will
be the home of another automatic trans-
THE FOURTH
DISTRICT
mission plant and Twinsburg (between
Akron and Cleveland) will soon reverberate from the presses now being installed in
a tremendous stamping shop. A new engine
plant will be completed early in 1957 at
Lima. Ground also has been broken for a
car and truck assembly plant at Brownhelm
(near Lorain). A site has been obtained for
a similar factory at Lordstown (near
Warren, Ohio).
When all of these facilities are completed,
it is estimated that employment in plants
of leading auto manufacturers will be onethird larger than at present and roughly
double the 1950 total. Altogether, the postWorld War II expansion program in the
District will have added (without allowing
for further enlargements) more than
100,000 new employees.
The broadening of an existing industry
on such a scale is equivalent in every economic respect to the establishment of a
major new industry in the Fourth Federal
Reserve District.
The reasons behind the broad shift of
the Big Three into the District, following
their decision to decentralize operations,
are not hard to find. A glance at the adjacent map reveals that transportation
facilities must have been a major factor in
locating the string of new plants in northern Ohio: the trunk-line railroads, the new
turnpike, and the coming seaway. Equally
important, perhaps, were the attractions
of the expanding District steel industry,
nearness to the major markets for finished
cars, a skilled labor force, and the necessary supporting industries to feed the complex auto assembly plants.
5
ALUMINUM
ROLLING
MILL
INTEGRATION
ON THE
The once placid Ohio River industrial
valley-stretching from Pittsburgh to Cincinnati-is
literally exploding with giant
new industrial projects. The in-rush of new
industry is concentrated chiefly in chemicals, ferro-alloys, and nonferrous metals.
The reasons behind the wave of expansion are not hard to find: cheap raw materials such as coal and salt, unlimited
supply of fresh water, low-cost river and
rail transportation,
nearness to major
consuming markets, and a pool of resourceful and dependable labor drawn from
southern Ohio, West Virginia, and Kentucky. All of this is supported by what is
probably the world's largest concentration
of privately owned electrical generating
plants, clustered along the Ohio river, and
located virtually on top of their fuel supply.
One of the most amazing industrial
complexes straddles the river at Clarington, Ohio. It was initiated through the
joint effort and cooperation of four major
companies: a coal company, a chemical
company, a nonferrous metals producer,
and an electric utility. More recently, an
oil refiner and a ferro-alloy producer have
joined the complex. Total cost of the
project, which is now under construction,
will be close to $300 million.
On the Ohio side of the river will be a
180,000-ton aluminum reduction plant
and, nearby, an aluminum rolling mill
capable of processing 64,000 tons of aluminum a year. The balance of the aluminum
will be available for processing elsewhere
-chiefly in Midwest and East Coast areas.
Across the river at Cresap, West Virginia, a coal company is developing a deep
shaft mine with an annual capacity of
OHIO
RIVER
three million tons. The mine will feed a
coal carbonization plant using the fluidized low temperature technique which will
process the coal into two basic products:
char and tar. The char will be conveyed
to a new power plant to be burned as a
very low cost fuel.
The tar will be refined in adjacent refineries into a wide range of tar acids and
tar chemicals. Included in this chemical
complex will be a tar acid refinery, a
carbon black plant, a delayed coker, and
a coke calcining plant.
The coal company has joined forces with
an oil refiner to operate a carbon calcining
plant with a yearly output of 165,000 tons.
The output of the calcining plant will be
used chiefly as electrode material for which
the aluminum reduction plant will be a
major customer.
The new 675,000-KW power plant
(jointly owned by an electric utility and
the aluminum company) will provide very
low cost power for the reduction works and
chemical processors. It is equipped with
three 225,000-KW generators with provision to expand by addition of two
450,000-KW generators when needed. The
power plant is tied into a state-wide grid
to assure continuous service.
In 1957 a new plant, with electric furnaces, will be built adjacent to the power
plant to produce silicon alloys in electric
furnaces to serve the new aluminum
industry.
Other offshoots of the complex are the
extension of railroad service down the
northern side of the river and the new
town of Wilson with 1,200 homes planned
to house part of the influx of workers.
7
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40
CHEMICALS,
I·
TITANIUM
AND
ZIRCONIUM
now called the plastics center of the world.
(The city of Parkersburg, West Virginia,
is located in the Fifth Federal Reserve District, near its boundary with the Fourth
District.)
Titanium and zirconium production in
the Fourth District is an outgrowth of the
chemical development.
In the production of titanium, chlorine
is used to convert the ore to titanium tetrachloride; then, either magnesium or metallic sodium processes are used to convert the
titanium tetrachloride to sponge. Zirconium is produced through a metallic sodium process.
Titanium, which is used extensively in
jet aircraft and missiles, is stronger than
aluminum but lighter than steel. It has
the ability to resist corrosion and withstand
very high temperatures.
By late 1957, Ashtabula will be the
largest titanium sponge producing center
in the world, with two producers having
an annual capacity of 12,500 tons, or
nearly 40 percent of the U. S. total.
The District has also become the leader
in processing titanium sponge into ingots,
sheets, and wrought mill products. Major
processors are rapidly expanding their
facilities at Niles, Massillon and Toronto
(Ohio) as well as at Pittsburgh and Midland (Pennsylvania).
Zirconium, an extremely tough metal, is
used in atomic reactors because of its great
resistance to heat and corrosion. A new
facility at Ashtabula will soon produce
1,500,000 pounds a year and another near
Parkersburg will turn out1,175,000 pounds.
The chemical industry has become one
of the fastest growing industries in the
District. In association with this development, the area is becoming the leader in
the production and fabrication of the new
wonder metals-titanium
and zirconium.
Chemical production is centered chiefly
in two sections: along the "chemical shore"
of Lake Erie (just east of Cleveland) and
in the Ohio River Valley. In both sections,
plentiful supplies of salt, limestone, coal,
water, and cheap electric power, as well
as nearness to markets, have been important factors stimulating growth.
The Lake Erie growth has centered
around the cities of Painesville and Ashtabula. In each, initial primary chemical
facilities have spawned a host of related
chemical plants, connected by a network
of pipelines that exchange chemicals and
by-products. In a sense, each area has become a vast chemical plant. Leading
products include alkalies, soda ash, caustic
soda, chlorine, sulfuric acid, acetylene,
metallic sodium, polyvinyl chloride, solvents, fatty alcohols, and rayon.
The Ohio River growth in recent years
has, perhaps, been even more rapid and
spectacular than Lake Erie developments.
No less than 40 major chemical facilities
are now located between Pittsburgh and
Cincinnati; the bulk of these have been
established since 1950. Major products include titanium tetrachloride, silicones,
chlorine, caustic soda, chloromethanes,
sulphuric acid pharmaceuticals, aniline,
vinyl chloride, synthetic fibers, and coal
chemicals. The area around Parkersburg is
9
ATOMIC
ENERGY
DEVELOPMENTS
power plant, the City of Piqua, Ohio, has
virtually completed all the necessary steps
to obtain approval from the Atomic
Energy Commission to build an organic
moderated reactor for a 12,500-KW power
plant. It may demonstrate the feasibility
of small-sized nuclear power plants.
The range of privately financed efforts
to explore the uses of the atom is enormous.
It includes such projects as the recently
completed 1,000-KW nuclear reactor in
Columbus by a world-famed research
agency. This is the largest of the "swimming-pool" type of reactor put into service
in the U. S. and will be used for a wide
variety of experiments.
At Cheswick, Pennsylvania (near Pittsburgh) the first privately financed atomic
reactor parts plant was put into service in
1955 to test parts under simulated operating conditions. Nearby is the center
which built the reactors for the U.S.S.
Nautilus and the Shippingport project.
Government-owned
atomic projects,
operated under contract by private companies, have continued to expand in the
District. At Waverly, the billion-dollar
diffusion plant has begun to operate with
a permanent staff of more than 3,000
people. In Fernald, Ohio, a uranium feedstock plant continues to expand. It processes uranium ore into high purity uranium which is used as the raw material, for
example, for the Waverly project.
Other recent government ventures include a $4,500,000 experimental laboratory under construction at the Plum
Brook Ordnance Works, near Sandusky,
Ohio. Its assignment is to develop an aircraft nuclear power plant.
The race to harness the atom for peacetime purposes, as well as to expand and
improve its use for national defense, finds
Fourth District private industry among the
leaders in the field.
The most spectacular project in the
District is America's first commercial
nuclear power plant which will begin
operation by the fall of 1957 at Shippingport, Pennsylvania. The heat will be provided by splitting uranium atoms.
The power plant will have a capacity of
100,000 kilowatts and the total cost of $85
million will be borne in part by the
Government and in part by a private
utility. The generated power will be fed
into the network already serving metropolitan Pittsburgh with conventional coalgenerated electricity.
The reactor vessel, built and designed in
the District by a leading electrical equipment manufacturer, is a steel vessel 33 feet
high, 10 feet wide, and 8Y2 inches thick.
It will be sunk deepin the earth in a waterfilled canal and surrounded by concrete
walls of five-foot thickness. Water pumped
through the reactor in stainless steel pipes
will pick up heat and when piped to the
boilers will convert the boiler water to
steam. From that point, the generation of
electricity follows the conventional pattern.
Experience and knowledge gained in the
construction and operation of the initial
nuclear power plant will go far in determining actual costs of nuclear generated
power, and will represent a long step forward in the effort to make this type of fuel
competitive with more conventional types
of fuels.
At the other extreme, in terms of size of
11
1000
2000
3000
4000
5000
6000
INDUSTRIAL
Industrial
industry
research
the area is probably
spending
in industrial
to flow
processes,
new
in the Fourth
$350 million
people,
From the in-
research
the
are
products
of expansion
The
depicts
the number
by private research
laboratories
the large cities of the District.
includes
scientists, engineers
and
clerks.
personnel
(Washington,
tion.)
now in progress
and
had from a partial
ratories
tally
quite
or which
medical
first industrial
has become
which was the site of the
a leader
laboratories
sciences, in quality
work on radiation,
Cleveland
appears
Other
to be the leading re-
search center in the District, with 119 com-
ploring
panies
which
research,
have recently been opened for
atomic and nuclear
employing
130 laboratories,
and
a total of 6,700 workers.
Pitts-
products.
Around
has 55 research
centers which em-
ploy 6,100 workers. Employment
twelve research
laboratories
5,600. Cincinnati
has 47 research
Pittsburgh
industrial
point
of view,
re-
research
to the number
and
and guided
Other
Akron,
new
on metallurgy,
solid-state
physics
electronics,
rubber,
radiation,
missiles.
important
glass, in Dayton
Miamisburg
activity
food
graphite,
natural
paint,
and
new research
facilities
are those which have located in Toledo for
of
workers.
But research
are working
synthetic
and
and
jet engines,
and electrochemistry,
centers in the country,
according
Cleveland
labora-
are ex-
aluminum,
chemicals,
From a
Cleveland
in Pittsburgh
glass,
coal,
petroleum,
are the fourth and fifth largest
when ranked
steel,
laboratories
in Akron's
approximates
tories staffed by 3,100 employees.
national
new projects
petroleum,
operating
research
and
in atomic
action, and testing of nuclear fuel elements.
research.
burgh
are now in the plan-
atom-smasher
the chart include research workers in social
or in market
be
labo-
research
control,
may
review of major
It does not include
nor does
of research
which have been established
recently
and support-
agencies;
of the 4,850
in the District
The
edi-
District
States.
Some idea of the varieties
of re-
of
1956, tenth
of the United
in four of
in colleges,
Academy
accounts for nearly 11 percent
ning stage.
In Pittsburgh,
centers or government
National
On this basis, the Fourth
assistants
working
33,400
Sciences.
such as laboratory
ing personnel
employing
to the listing of Indus-
by the
and
by industry
located
trial Research Laboratories oj the United States,
laboratories
chart
District,
according
Altogether
compiled
diversification.
search workers employed
cities.
laboratories
ex-
the new uses for old products,
course
large
and
and the lower costs that will keep industry
on the upward
to these
there are 510 research
Private industry in
a year on this vital function.
pected
limited
has become a major
in the District.
vestment
RESEARCH
is by no means
Cincinnati
13
for business machines,
for atomic
for chemicals
research,
and
in
in
and gas turbines.
NEW, FRONTIERS
IN
TRANSPORTATION
foot channel instead of the existing 9-foot
depth.
Work has started also on the locks for a
new high dam at Greenup (near Ashland,
Kentucky) which will replace four existing
structures. In early 1957, two similar
projects will get under way at Opossum
Creek and Pike Island dams near Wheeling.
The opening of the new Ohio Turnpike
in October 1955, linking the Pennsylvania
Pike and the now completed Indiana
Turnpike, must be regarded as a major
step in speeding and reducing the cost of
both auto and truck transportation. The
sprinkling of new multimillion-dollar auto
assembly and parts plants along its length,
with easy access to both the road and coming seaway, is a testimony to the magnetic
pull of these transportation facilities. Nor
is this the end to improved roads: a northsouth throughway is on the drawing
boards to link Conneaut and Cincinnati
and another between Pittsburgh and Erie.
These will likely be free roads. In addition,
the states of Ohio, Pennsylvania, West Virginia and Kentucky have multimilliondollar highway programs under way as a
part of the accelerated Federal road plan.
Another frontier in transportation methods is the private I l vinch pipeline to carry
coal 108 miles from a mine at Georgetown,
Ohio, to an electric utility at Eastlake. It
is expected to begin operating at full
capacity this spring. It is designed to deliver 1,200,000 tons of coal a year as a
50-50 mixture of coal and water. After
being dried out, the powdered coal will be
blown into boilers for fuel. The pipeline
will cut coal transportation costs by more
than 40%.
Adequate and low-cost transportation
is a major factor governing the growth and
development of industry and commerce in
a given geographic area.
Although the Fourth District is already
served by a large network of railroads,
pipelines, highways and airlines, both
public and private agencies are making
notable strides toward improving and reducing the costs of established transportation, as well as innovating cheaper modes
of transportation. Expanded or improved
transportation facilities have a triple impact upon industry: markets for finished
goods are enlarged, the cost of raw material
assembly is reduced, and new resources of
materials become available.
The prospective completion of the St.
Lawrence Seaway in 1959 is already having a marked impact upon the economy
of the Fourth Federal Reserve District.
The prospect of obtaining rich Labrador
iron ore to supplement dwindling Lake
Superior supplies has favorably influenced
the plans for expansion of steel mills. Inquiries from chemical manufacturers have
multiplied. Lake Erie ports of Toledo,
Cleveland, Ashtabula, and Erie are planning, or have under way, the improvement
of general cargo docks and port facilities,
and the assembling of waterside tracts of
land to offer industry.
In another part of the District, improvements in the Ohio River are being pushed
vigorously. Construction of the Markland
dam, down-river from Cincinnati, was
started in the spring of 1956. This new
high level dam and one set of modern locks
will replace five existing dams and locks.
An 87-mile pool will have a minimum 1215
COMMUNITY
DEVELOPMENT
mittee was organized to promote peaceful
settlements of labor disputes as an aid to
industrial growth. By 1955, man-days lost
from strikes were the lowest of any major
city in Ohio. In early 1954, the Toledo
Industrial Development Council was
formed and jointly financed by the business community, labor unions, and a
local newspaper to promote industrial
diversification and expansion.
In a community that has, in the past,
been largely dependent upon the automotive industry, the two-year record of
achievement in Toledo is impressive. Expansions or new plant locations by 24
companies in 16 industries have been
announced. An 89-acre planned industrial
district has been opened at a projected
interchange of the Detroit-Toledo Expressway. A Port Authority has been
created by the city and county to develop
port facilities for the coming seaway.
Lexington, Kentucky, has tackled the
problem of attracting new industry in a
somewhat different manner. The Lexington Industrial Foundation, a nonprofit
corporation, was organized in early 1955
as a department of the Chamber of Commerce. Local businessmen subscribed
$221,000 to purchase a 138-acre tract of
land strategically located. The tract was
provided with roads, sewers, etc. and then
offered to industry at actual cost. Since
then, three companies have taken up 89
acres and commenced construction, while
two others have located nearby. Within
two years, these new companies will employ 11,000 persons, as compared with
total manufacturing employment in the
county of 6,600 at the end of 1954.
Although the growth, development, or
redevelopment of a city has often, in the
past, been a haphazard process, in recent
years it has more likely been the result of
conscious planning. The kindling spark
may be a railroad, electric utility, Chamber of Commerce, newly organized citizens' committee, planning commission, or
an Industrial Development Corporation.
Today, planning is almost universal
among the cities and towns of the District.
Three of the more interesting programs
are operating in Pittsburgh, Toledo and
Lexington.
The District's most widely publicized
and most comprehensive community improvement-development program is being
carried out in the greater Pittsburgh area
under the leadership of the Allegheny
Conference on Community Development.
This nonprofit agency has coordinated the
work of Federal, state and many municipal
agencies.
Altogether, a $2.5 billion program (much
of it already spent) has been undertaken
to revitalize the Pittsburgh area. It includes a 36-acre Point Park at the junction
of the Allegheny and Monongahela rivers;
25-acre Gateway Center adjoining the
park; 5 new office buildings with two more
under construction; 1-acre Mellon Square
Park in the heart of the Golden Triangle;
5 new parking garages; a new airport; and
a network of new expressways. At the
upper end of the Triangle, 106 acres of
blighted slum are being acquired to be
transformed into a civic center.
Toledo, also, has been a leader in community development. In 1945, its pioneering Labor-Management-Citizens
Com17
LONG
TO
ESTABLISHED
EXPAND
IN
INDUSTRIES
THE
The growth of new industries in the
Fourth Federal Reserve District, as depicted on the preceding pages, should in
no way detract from the impressive gains
scored in recent years by the well established and leading industries of the area:
machinery, primary metals, fabricated
metals, clay and glass, and rubber
products.
The District's steel mills, which account
for 40 percent of the nation's steel-making
capacity, are in the midst of a very large
expansion program which will increase
capacity by the end of 1958 to 56.5 million
tons, or one-third above the 1948 level.
The increase in capacity to pour hot
metal is not being achieved by the construction of entirely new steel works. Instead, it is being accomplished by the enlargement and improvement of existing
properties as well as by the adoption of
technological improvements. Included are
new and enlarged blast furnaces, open
hearths and electric furnaces; the adoption
of oxygen converters and high pressure
blowers; the upgrading of ore by beneficiating taconite; and the doubling of iron
ore sintering capacity.
Metal processing capacity has also been
substantially enlarged by the addition of
new, faster and larger rolling mill equipment. In addition to expansion of facilities
to produce the usual hot and cold rolled
carbon sheet and strip, there has been a
marked trend toward specialty or high
valued products such as galvanized sheets,
tin plate, alloy and stainless steels, silicon
sheets and clad steels of various kinds.
The recent and prospective increase in
the availability of steel has stimulated the
FOURTH
CONTINUE
DISTRICT
construction of new metal fabricating and
machinery plants as well as growth in
capacity of existing manufacturers. Now
under construction near Hudson, Ohio, is
a large plant to produce giant diesel
tractors. Home appliance manufacturers
have also recently completed major installations at Clyde, Columbus and
Marion, Ohio. Machine tool builders have
completed, or are working on, major additions in Cleveland, Cincinnati, and New
Philadelphia.
The stone, clay and glass industries are
also vigorously expanding. Toledo is the
home of a giant plate glass factory, incorporating the new twin-grinding process,
and a windshield-bending plant. Pyrex
ware will be manufactured at Greenville,
Ohio, and television tubes in Columbus.
A pressed-glass plant will be erected in
Somerset, Kentucky. Other additions to
glass facilities are being made in Connellsville (con tainers), Greens burg (windshields), and Arnold, Pennsylvania (nonglare glass). A basic refractories plant has
just been completed at Columbiana to
serve the steel, glass and cement industries.
Cement mills have major programs under
way at Wampum and Bessemer, Pennsylvania, and at Lorain, Ohio.
The District's rubber industry is energetically pushing a diversification program
and expanding the capacity of recently
acquired plants for the production of synthetic rubber. Non-tire items now account
for more than one-half of the industry's
sales. These include such diverse products
as foam rubber, flooring, industrial goods,
toys, and basic resins for a wide variety
of purposes.
19
@FedFRASER