I don't buy the floor area benefits...

Floor area of a warehouse is very cheap compared to the ~ $13 Billion worth of cars that a factory will churn out in a year.

The machines you put in a factory, and the people you employ in the factory are the expensive bits. The actual concrete floor area is super cheap.

If someone has looked at the total cost of a factory, calculated the cost per square foot, and then said "if only we could reduce the square footage, we would save money", then they are fooling themselves.