The Electric Vehicle Industry and Local Economic Development: Prospects and Policies for Southern California

Southern California's manufacturing economy is currently facing a major crisis of deindustrialization and job loss. The emerging electric vehicle industry represents a possible new growth pole for the region, and a number of private and public initiatives have already been taken to encourage the development of the industry in the local area. I argue that policy can significantly enhance this development process by focussing on specifically regional sources of industrial productivity, innovativeness, and competitive advantage. I argue also that the existing industrial assets of Southern California, combined with policy of this sort, could indeed foster the growth of a major cluster of electric vehicle and parts producers in the region. To be successful, policy needs to be concentrated in particular on fostering flexible and collaborative manufacturing systems together with various services (for example, in the areas of technological research, labor training, venture capital provision, and so on) that enhance the region's overall stock of external economies. I conclude by suggesting that there are significant parallels between the growth of the aircraft industry in Southern California before World War 2, and the development of the electric vehicle industry in the region today.