Alcoa Corporation (a portmanteau of Aluminum Company of America) is an American industrial corporation. It is the world's eighth largest producer of aluminum, with corporate headquarters in Pittsburgh, Pennsylvania. Alcoa conducts operations in 10 countries. Alcoa is a major producer of primary aluminum, fabricated aluminum, and alumina combined, through its active and growing participation in all major aspects of the industry: technology, mining, refining, smelting, fabricating, and recycling.
|Founded||Pittsburgh, Pennsylvania, US (1888)|
|Founder||Charles Martin Hall|
|Revenue||US$11.652 billion (2017)|
|US$1.205 billion (2017)|
|US$217 million (2017)|
|Total assets||US$17.447 billion (2017)|
|Total equity||US$4.523 billion (2017)|
Number of employees
|~14,600 (December 2017)|
In May 2007 Alcoa Inc. made a US$27 billion hostile takeover bid for Alcan in an attempt to form the world's largest aluminum producer. The bid was withdrawn when Alcan announced a friendly takeover by Rio Tinto in July 2007.
On November 1, 2016, Alcoa Inc. split into two new entities: Alcoa Corporation, which is engaged in the mining and manufacture of raw aluminium, and Arconic, which processes aluminum and other metals.
In 1886, Charles Martin Hall, a graduate of Oberlin College, discovered the process of smelting aluminium, almost simultaneously with Paul Héroult in France. He realized that by passing an electric current through a bath of cryolite and aluminium oxide, the then semi-rare metal aluminium remained as a byproduct. This discovery, now called the Hall-Héroult process, is still the only process used to make aluminium (however, see also Bayer process).
Probably fewer than ten sites in the United States and Europe produced any aluminium at the time. In 1887, Hall made an agreement to try his process at the Electric Smelting and Aluminum Company plant in Lockport, New York, but it was not used and Hall left after one year. On Thanksgiving Day 1888, with the help of Alfred E. Hunt, he started the Pittsburgh Reduction Company with an experimental smelting plant on Smallman Street in Pittsburgh, Pennsylvania. In 1891, the company went into production in New Kensington, Pennsylvania. In 1895, a third site opened at Niagara Falls. By about 1903, after a settlement with Hall's former employer, and while its patents were in force, the company was the only legal supplier of aluminium in the United States.
By 1902 New Kensington consisted of 173,000 sq. feet on 15 acres with 276 employees and the company operated hydropower and reduction plants in Niagara Falls, NY (1895), Shawinigan Falls, Quebec (1900), mining operations in Bauxite, AR (1901) and reduction facilities in East St. Louis, IL (1902). "The Aluminum Company of America" became the firm's new name on January 1, 1907. The acronym "Alcoa" was coined in 1910, given as a name to two of the locales where major corporate facilities were located (although one of these has since been changed), and in 1999 was adopted as the official corporate name.
From 1902 until 1915 additional plants in Massena, NY (1903), Alcoa, TN (1911), Edgewater, NJ (1915), Badin, NC (1915) came online while New Kensington had 31 buildings in the complex housing six departments (tubes, sheets, rods, bar and wire, extrusion, jobbing, foil) and two subsidiaries (Aluminum Cooking Utensil Company and Aluminum Seal Company). In 1907 it created the "company town" of Pine Grove, New York, for workers outside Massena. In Baden, Alcoa, Maryville and elsewhere the company funded the construction of schools, parks, playgrounds and medical facilities.
In 1963, John D. Harper, a Tennessee native who had started with the company in 1925, then was hired, in 1933, as an electrical engineer, following his graduation from the University of Tennessee, and who had subsequently served as vice president and director; was named president of Alcoa, then CEO, in 1965, then chairman, in 1970, serving until his retirement from Alcoa, in 1975. Harper was also a director of Mellon Bank N.A., Goodyear Tire and Rubber Company and Procter & Gamble, and a trustee of Carnegie-Mellon University. An advocate of close associations between business and government; in 1972, Harper, with General Electric CEO Fred J. Borch was instrumental in co-founding the Business Roundtable, and served as its chairman for three years.
Alcoa purchased an 8% stake of Aluminium Corporation of China (Chalco) in 2001. It tried to form a strategic alliance with China's largest aluminium producer, at its Pingguo facility; however, it was unsuccessful. Alcoa sold their stake in Chalco on September 12, 2007, for around $2 billion.
In 2004, Alcoa's specialty chemicals business was sold to two private equity firms led by Rhône Group for an enterprise value of $342 million, which included the assumption of debt and other unfunded obligations. Rhône Group then changed the name to Almatis, Inc.
In 2005, Alcoa began construction in Iceland on Alcoa Fjarðaál, a state-of-the-art aluminium smelter and the company's first greenfield smelter in more than 20 years, albeit under heavy criticism by local and international NGOs related to a controversial dam project exclusively dedicated to supplying electricity to this smelter. Also, Alcoa has completed or is undergoing primary aluminium expansion projects in Brazil, Jamaica, and Pinjarra, Western Australia.
In 2006, Alcoa relocated its top executives from Pittsburgh to New York City. Although the company's principal office is located in New York City, the company's operational headquarters are still located at its Corporate Center in Pittsburgh. Alcoa employs approximately 2,000 people at its Corporate Center in Pittsburgh and 60 at its principal office in New York.
On May 8, 2008, Klaus Kleinfeld was appointed CEO of Alcoa, succeeding Alain Belda. On April 23, 2010, Alcoa's board of directors selected Kleinfeld to the office of chairman, following Belda's planned retirement.
On July 16, 2012, Alcoa announced that it would take over full ownership and operation of Evermore Recycling and make it part of Alcoa's Global Packaging group. Evermore Recycling is a leader in used beverage can recycling, purchasing more recycled cans than any other group worldwide.
On January 9, 2014, Alcoa reached a settlement with the U.S. Securities and Exchange Commission and the U.S. Department of Justice over charges of bribing Bahraini officials. Under the terms of the settlement they will pay the SEC $175 million to settle the charges. To settle the criminal claims with the DoJ, Alcoa World Alumina (AWA, a company within Alcoa World Alumina and Chemicals) is pleading guilty to one count of violating the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA). AWA will pay the DoJ $223 million in five equal installments over the next four years, bringing the company's total bill for the scandal to $384 million.
In June 2016, Alcoa announced plans to split itself into two companies. A new company, Arconic, would take over the business of designing and building processed metal parts, primarily for the automotive and aerospace industries, while the Alcoa name would be remain on a company that continued the mining, smelting, and refining of raw aluminium. The split was completed on November 1.
In April 2017, Alcoa announced that it would relocate its corporate headquarters back to Pittsburgh as part of a general consolidation of administrative facilities around the world.
The Political Economy Research Institute ranks Alcoa 15th among corporations emitting airborne pollutants in the United States. The ranking is based on the quantity (13 million pounds in 2005) and toxicity of the emissions. In April 2003, Alcoa Inc. agreed to spend an estimated $330 million to install a new coal-fired power plant with state-of-the-art pollution controls to eliminate the vast majority of sulfur dioxide and nitrogen dioxide emissions from the power plant at Alcoa's aluminium production facility in Rockdale, Texas. The settlement was the ninth case the Bush administration pursued to bring the coal-fired power plant industry into full compliance with the Clean Air Act. Alcoa was unlawfully operating at the Rockdale facility since it overhauled the Rockdale power plant without installing necessary pollution controls and without first obtaining proper permits required by "New Source Review" program of the Clean Air Act. In February 1999, Alcoa cleaned soils and sediment contaminated with polychlorinated biphenyls (PCB) and lead at the York Oil federal Superfund site in Moira, New York, in accordance with the Environmental Protection Agency. The site, a former waste oil recycling storage facility, accepted waste oil from a number of companies, including Alcoa. The facility was improperly managed and operated and, as a result, soils on the York Oil Property and nearby wetlands sediments and groundwater were contaminated. The United States Environmental Protection Agency (EPA) issued a Superfund Unilateral Order on December 31, 1998, requiring Alcoa to excavate, treat and dispose of the contaminated wetlands sediments.
Operations by countryEdit
Alcoa formed the Alcoa Minerals of Jamaica subsidiary on the island in 1959, shipping their first load of bauxite in 1963 from Rocky Point. Later in 1972, Alcoa established a 500,000 metric tonne per year refinery where they process bauxite into alumina. They have continued to upgrade the plant through the years and its now capable 1,425,000 metric tonnes per year. In 1988 the Jamaican government gained a 50% share in the subsidiary and renamed the operation to Jamalco, Alcoa being the managing partner. Expansion of the operation in 2007 resulted in Alcoa owning a total of 55% of the operation. Alcoa continues to mine bauxite in the Jamaican parishes of Clarendon and Manchester while competitors' operations take place in nearby parishes.
Alcoa is a major owner of the fr:Compagnie des bauxites de Guinée through Halco Mining, together with Rio Tinto Alcan and the Guinean government. Guinea is the second global producer of bauxite and it is said to have half of the world's reserves.
The Fjardaál smelter in eastern Iceland was completed in June 2007, and brought into full operation the following April. The plant processes 940 tons of aluminium a day, with a capacity of 346,000 metric tons a year, making it Alcoa's second largest capacity smelter. For power, the plant relies on the Kárahnjúkar Hydropower Plant, constructed and operated by the state owned Landsvirkjun specifically for the smelting operation. That project was subject to controversy due to its impact on the environment.
In 2006, Alcoa and the government of Iceland signed an agreement on instigating a thorough feasibility study for a new 250,000 tpy (Tons Per Year) smelter in Bakki by Húsavík in Northern Iceland. In October 2011, the proposed project was dropped because "the power availability and proposed pricing would not support an aluminum smelter".
Alcoa announced plans to close the office in Reykjavik.
On November 21, 2006, Alcoa announced that it planned to close the Waunarlwydd works in Swansea, with the loss of 298 jobs. Production ceased at the Swansea plant on January 27, 2007. A small site closure team worked at the site until December 31, 2008. The site is still owned by Alcoa, but is now managed locally and renamed, Westfield Industrial Park. Several of the large buildings are leased out to local businesses.
Alcoa operates bauxite mines, alumina refineries and aluminium smelters through Alcoa World Alumina and Chemicals, a joint venture between Alumina Limited and Alcoa. Alcoa operates two bauxite mines in Western Australia—the Huntly and Willowdale mines. Alcoa World Alumina and Chemicals owns and operates three alumina refineries in Western Australia: Kwinana, Pinjarra, and Wagerup. The Wagerup expansion plans have been put on hold due to the Global Financial Crisis. Two aluminium smelters are also operated in the state of Victoria at Portland and Point Henry; the Point Henry smelter was scheduled to be closed in August 2014. Alcoa Australia Rolled Products, a 100% Alcoa Inc. venture, operates two rolling mills. The Point Henry Rolling mill in Victoria and the Yennora rolling mill in N.S.W. have a combined rolling capacity of approx. 200,000 tonnes. Alcoa uses 12,600 GWh or 15% of Victoria's electricity annually.
Alcoa's Western Australian Wagerup plant has a troubled history in the context of claims that pollution from the plant has had an adverse impact on the health of members of the adjacent local community.
On January 3, 2003, Alcoa opened its new operations headquarters on the North Shore of Pittsburgh. This move came about after it donated its 50-year-old skyscraper headquarters in Downtown Pittsburgh to the Regional Development Authority.
Alcoa created a plant just outside Maryville in Blount County, Tennessee. To support the factory, Alcoa built a small city and named it as such. The Alcoa Tenn Federal Credit Union was the first employee created credit union in the state. The plant is no longer an Alcoa business.
Alcoa's Massena West plant is the longest operating smelter in the United States, having been in continuous operation since 1902. The Reynolds Aluminum Plant became Massena East when the companies merged in 2000.
Alcoa had a smelting plant in Badin, North Carolina from 1917 to 2007 and continued a hydroelectric power operation there until February 1, 2017 when the Yadkin Hydroelectric Project was sold to Cube Hydro.
Alcoa also operates an aluminium smelting plant of similar size to the one in Tennessee in Warrick County, Indiana, just east of Newburgh, Vectren Energy operates a coal power plant on the site to provide electricity.
Alcoa maintains several Research and Development Centers in the United States. The largest one, Alcoa Technical Center, is located East of its Pittsburgh Headquarters at Alcoa Center, Pennsylvania. The "Tech Center" is as large as some college campuses, has its own zip code and maintains an extensive intellectual and physical resource for innovation. Alcoa's extensive safety program continuously improves safety at the Tech Center. After Paul O'Neill became Alcoa CEO in 1987, Alcoa became one of the safest companies in the world, despite the aluminium industry's inherent risks.
Alcoa plans to close offices in Richmond, Virginia; Nashville, Tennessee; and Chicago.
In popular cultureEdit
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- Aluworks limited (ALW) – Half year best performing stock July 2006
- "Alcoa in Ghana: News: News From Ghana: Alcoa, Government of the Republic of Ghana Agree to Re-Start Valco Smelter". Alcoa.com. August 4, 2005. Retrieved July 13, 2010.
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- Fast Company magazine July 1, 2009 – Note: Dubious Source
- "Alcoa Online Newsroom -". www.alcoa.com. Retrieved May 2, 2018.