Kentucky’s Aluminum Industry Sees Explosive Growth
New demand from the automotive industry has propelled the surge in Kentucky’s aluminum industry, with total aluminum-related corporate investment reaching $2.6 billion across 90 announcements since 2014.
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In the classic Dustin Hoffman film The Graduate, a well-meaning neighbor pulls aside young Benjamin Braddock at his college graduation party to offer a little career advice.
“Just one word,” he says, oozing with certainty. “Plastics…There’s a great future in plastics.”
If the film were remade today, perhaps set in Kentucky, chances are the commodity recommended would be “aluminum.” That’s because as the federally mandated fuel economy regulations, known as CAFE standards, grow more stringent, automakers are increasingly turning to lighter-weight aluminum for body panels, structural components, mechanical parts, and housings. While aerospace manufacturing, construction, and consumer goods are significant drivers, new demand from the automotive industry has propelled the surge in Kentucky’s aluminum industry.
The latest example emerged in May when Tri-Arrows Aluminum Inc. unveiled a 60-job, $125 million Phase II investment at the already massive Logan Aluminum Inc. rolling mill it jointly owns near Russellville, Kentucky. That came atop the 190-job, $250 million Phase I expansion at Logan, announced in 2015 and currently under construction. The projects are preparing Logan to make automotive-grade, flat-rolled sheet, while continuing to service the beverage can market.
Just the month earlier, Braidy Industries Inc. rocked the state with an announcement of its planned $1.3 billion rolling mill in northeast Kentucky’s Greenup County to serve primarily the automotive and aerospace industries.
“In my 24 years of public service, [Braidy Industries] is the project I have waited for,” Greenup County Judge-Executive Robert Carpenter said after the deal was announced in April. “This project will change the entire region going forward.”
The Industry’s Range
A recent market report from the Kentucky Cabinet for Economic Development counts nearly 200 aluminum- related facilities in Kentucky, employing more than 20,000 people. The sector is broad, with smelters, recyclers, rolling mills, injection molders, extruders, die-casters, machine shops, and companies manufacturing a galaxy of finished products including Reynolds Consumer Products in Louisville, which makes the world’s supply of aluminum foil.
Other companies that have announced investments in the state, or plans to do so, include Constellium- UACJ, Gibbs Die Casting, Kobe Aluminum Automotive Products, Kobe Steel, Novelis, Rane (Madras) Ltd., UACJ Whitehall, and Pride Industries. This growth brings Kentucky’s total aluminum-related corporate investment to an eye-popping $2.6 billion across 90 announcements since 2014.
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