Ohio Turnpike is a testament to a little-recognized
side benefit auto makers have long provided to industrial America: the spur
they give suppliers to innovate. Paul Springer of Cleveland started a firm called Springco
Metal Coating Inc. 32 years ago to make parts corrosion-resistant. To please the
auto makers, he expanded his technology, such as by creating a conveyor system
to carry parts through a series of chemical baths and ovens to apply complex
coatings. Now he markets this technology well beyond the auto market, for
products ranging from water heaters to laser-guided bombs.
"This industry was being driven by automotive in the
early 1970s … They were really the first to start the battle to make metal
parts last longer," Mr. Springer says. Doing work for the car companies
"put me in the position to put these coatings on all kinds of parts."
The domestic auto makers, while roundly criticized over the
years for resisting product innovations, have often sparked inventiveness in
parts manufacturers, which must compete hard for the business. In this way, the
car makers infuse both technical innovation and other new business ideas, such
as for cost-control, in the wider economy.
Economists are of two minds on the importance to the economy
of the car makers' nurturing role. "The auto industry is a driving force
for innovation in a variety of industries — materials, electronics," says
Peter Morici, a professor at the University of Maryland's Robert H. Smith
School of Business. "I don't think you can have a true [major] economy
without it."
Still, he says that function isn't vital enough, in itself,
to justify bailing out the auto industry. Testifying to Congress last year, he
warned that the government could end up supporting the auto sector
indefinitely.
Nigel Gault, an economist at IHS Global Insight in Lexington, Mass., says
one wouldn't "necessarily want to preserve an auto industry just because
of its spillover benefits to the rest of the economy. If we don't use resources
to build autos, but use them to build something else, maybe that something else
would have just as much spillover benefits."
The effects of the industrial diaspora are evident all along one of
America's major industrial corridors, the Ohio Turnpike. Anchored toward the
west by Toledo, the self-styled "Auto Parts Capital of the World,"
and on the east by a sprawling GM plant in Lordstown, the turnpike links
businesses that sprang up from the auto industry and branched out beyond it.
The auto industry has also pushed innovation to the larger
manufacturing economy by shifting more research-and-development responsibility
to suppliers.
Source: Aeppel, Timothy, “Car-Industry Slump Imperils Role in Spurring
Innovation” Wall Street Journal,
January 30, 2009.