Alcoa will invest approximately $300 million to expand its Davenport, Iowa, rolled products plant to meet rising demand from the automotive market. This move comes in response to demand from automotive original equipment manufacturers (OEMs) that are increasingly switching from steel to aluminum products as they seek to increase the fuel efficiency, safety, durability, and performance of the vehicles they produce.
The expansion project will create an additional 150 full-time jobs in Davenport once completed, bringing total employment to more than 2,300 high-value jobs. In addition, during construction, 150 additional jobs will be created at the plant. The expansion is slated for completion by the end of 2013.
"The automotive market is a tremendous growth opportunity for Alcoa over the next several years," said Klaus Kleinfeld, Alcoa chairman and CEO "Our leading-edge technology solutions and our world-class manufacturing capabilities, combined with our dedicated and highly-engaged work force, put us in an enviable position in the market and bodes well for future growth.
"Consumers want cars that are more fuel efficient and deliver the same, if not better, performance as they are accustomed to today," said Helmut Wieser, Alcoa executive vice president and group president of Alcoa Global Rolled Products. "Practically every OEM in the world has come to us to discuss how our leading technology solutions can help them make their cars stronger, lighter, and more fuel efficient."
Alcoa sees a huge opportunity for its leading technology solutions in the automotive market, including its patented Alcoa 951 technology, which is used to improve adhesive bonding for vehicle assemblies. The process is used as a pretreatment for aluminum alloy sheet, extrusions, and castings, and tests have shown it as being four to nine times stronger than titanium zirconium applications currently used in the automotive industry, according to company sources.
An economic development incentive package from the Iowa Department of Economic Development (IDED) helped secure the selection of Davenport for the expansion. The incentive package includes tax, financing, and R&D credits as well as training grants for the Davenport work force and new employees.