The Hot Manufacturing Centers

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As manufacturing changes, so does the geography of manufacturing. With the help of Cognetics Inc., INC. identified the 10 metropolitan areas that are home to the greatest concentrations of fast-growing manufacturers. On the list are some Sunbelt cities that are relatively new to manufacturing, but there are also signs of renewal in some of the old manufacturing centers of the Rust Belt. Reporter Leslie Brokaw profiled some new companies in old industries that typify America's manufacturing revival.

#5 SAN FRANCISCO

Finis Conner had little success trying to raise money from venture capitalists when he launched his disk-drive company in 1986. All around Silicon Valley, disk-drive firms were failing almost daily, as the high-tech industry came to the realization that there were simply too many companies. In the shakeout that followed, many producers sought to cut costs by moving production offshore to Korea or Taiwan. But not Conner Peripherals Inc. Squeezing a $6-million investment and a sizable contract out of Compaq Computer Corp, Conner entered into the disk-drive sweepstakes with a new design that was smaller and faster and used 30% fewer parts than conventional drives -- and, therefore, cost less to produce. In 1987, its first year, Conner's sales topped $100 million, a record for the industry, as Conner seized market share not only from American competitors but from the Japanese and Taiwanese as well. When books are closed on its second year in December, Conner expects to post sales of $300 million, a good portion of it to Japanese computer maker Toshiba and a host of other foreign customers. At Conner Peripherals they don't just talk about American industrial competitiveness. They're writing the book on it.

#8 DALLAS

While most of Texas rises and falls with the price of oil, Dallas has insisted on building a diversified economy with a strong and growing manufacturing base. Among the stellar performers has been Microdynamics Inc., which makes computer-aided design systems for manufacturers of clothing, shoes, and other products cut from leather and fabric. Microdynamics combines IBM hardware, its own software, and its own custom-designed peripherals into packages that sell from $75,000 to $750,000. The systems lay out the most material-efficient patterns, savings clients 2% to 4% annually on cost of materials. And by linking the computer directly to the knives, lasers, and water jets, precision is improved. Microdynamics's systems now help direct the manufacture of Liz Claiborne clothing, Bally shoes, Levi Strauss jeans, and La-Z-Boy recliners. Sales during the past year have climbed from $12 million to $18 million.

#9 MINNEAPOLIS

Flexible production doesn't get much more flexible than at Road Rescue Inc., a St. Paul company across the river from Minneapolis. The company makes every one of its $50,000 ambulances to order, accommodating hundreds of different design options, from the color of the trim to the layout of the ambulance interior. Road Rescue constructs its high-tech medical chambers on top of chassis and engines purchased from Ford and General Motors. The whole process employs about 100 metal workers, welders, and assemblers, most of them fresh from vocational school. Now in its 12th year of operation, Road Rescue last year posted sales of $11 million, representing 5% of the U.S. market.

#3 CHICAGO

Although Chicago has lost 30% of its manufacturing jobs, it remains one of our leading manufacturing cities. At Viking Enterprises Corp, for example, what started in 1966 as a modest prepress color-separation house has become a vertically integrated operation that does everything from printing its own line of greeting cards to operating retail card shops. Like most successful printers, Viking has been energetic in introducing the computer into its operation. According to comptroller David Peterson, the company's new electronic retouching system is so versatile that it can "put Gorbachev's head on Reagan's body without you even noticing it." Viking's employment has gone from 100 to 350 in five years.

#4 DETROIT

In the past decade, the Motor City has lost more than third of its manufacturing jobs -- some 130,000 total. But while the big automakers and their supplies have been cutting back on production jobs, hundreds of smaller companies like Novatron Corp. have begun to take advantage of the pool of skilled talent in the area. Novatron, with annual sales of $8 million, employs 110 who manufacture custom-designed instrument panels for boats and recreational vehicles. These specialty dashboards are now found on 30% of Class-A motor homes, 35% of U.S.-made boats, and 90% of Canadian boats -- just the kind of market share Detroit companies used to brag about in the 1950s.

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