South Bay (Los Angeles County)

The Port of Los Angeles, sprawling across the shorelines of San Pedro and Wilmington, is the busiest in the United States. When combined with the Port of Long Beach, it is the fifth-busiest in the world. Traditionally, most of the populations of Wilmington and San Pedro have worked for the port in some capacity. It is increasingly the primary driver of the Southern California economy: industrial growth in the Inland Empire is almost entirely attributable to increased port traffic since the 1980s. Unfortunately, the massive increase in cargo volume has created significant air pollution (especially of particulate matter resulting from the combustion of low-grade marine diesel fuel) in neighboring communities.

The South Bay is the traditional home of Southern California's aerospace industry. While considerably shrunken from its Cold War peak, it still represents a major economic force, employing thousands in high-skill, high-wage engineering positions and generating enormous amounts of tax revenue. Northrop Grumman has a major facility in El Segundo where the F/A-18 Hornet fuselage is manufactured, as well as the headquarters of the Space Technology division in Redondo Beach and a facility at the Hawthorne Municipal Airport. Alcoa Fastening Systems, a subsidiary of Alcoa Inc. which produces aerospace fasteners, has their corporate headquarters located in Torrance with manufacturing facilities in both Torrance and Carson. Boeing and Lockheed Martin also maintain extensive production facilities throughout the South Bay, and Raytheon's Space and Airborne Systems business unit is based in El Segundo. The Los Angeles Air Force Base, in El Segundo, is the locus of much of this aerospace research activity, as it is the primary development facility for military satellites and other space programs. DirecTV, a former subsidiary of Hughes Aircraft, is also headquartered in El Segundo for this reason. SpaceX also headquartered in the South Bay, is located in Hawthorne.

View of the Palos Verdes Peninsula. Los Angeles in the distance.

Petroleum refining is another important component of the South Bay's economy. Major South Bay refiners include Tesoro (ARCO facility in Carson), Chevron (El Segundo), Phillips 66 (Wilmington), PBF Energy (Torrance), Tesoro (Wilmington), and Valero (Wilmington). These refiners supply the lion's share of petroleum products for Southern California, as well as for Nevada and Arizona. As the Los Angeles region's oil fields are mostly exhausted, most of the crude oil that feeds the refineries is brought in from terminals at the port.

Local politicians and activists have long denounced the refineries for the amount of air pollution they generate, but in recent years these protests have been muted as the Port of Los Angeles has become the region's dominant polluter. The controversial practice of residue flaring returned to the forefront during the September 12, 2005 Los Angeles Department of Water and Power outage; facing dangerous pressure buildups, refinery operators in Wilmington were forced to flare, resulting in dangerously bad air quality throughout the southeastern South Bay. The incident has renewed calls for restrictions on flaring in non-emergency situations.

Japanese automobile manufacturer Honda maintains its North American headquarters in the South Bay, in the city of Torrance. (Nissan was also headquartered in the South Bay until late 2005, and The company then relocated to Tennessee, citing the high cost of running a business in California. Toyota left in 2017 for Plano, Texas for many of the same reasons.) While these locations are largely the legacy of the region's historical importance as a Japanese-American population center, it has proven fortuitous for two reasons: first, it enables closer oversight of vehicle import operations at the nearby ports; and second, it gives them proximity to the automobile customization culture that is prominent in nearby South Los Angeles. Tesla is stationed near the headquarters of SpaceX in Hawthorne