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Alcoa Completes U.K. Aluminum Lithium Expansion To Help Airframers Increase Fuel Efficiency

Stocks in this article: AA

Alcoa (NYSE:AA) today announced it has completed the expansion of aluminum lithium capacity at its Kitts Green facility in the United Kingdom to serve the growing demand for the Company’s 3 rd generation aluminum lithium alloys. Alcoa projects its aluminum lithium revenues will quadruple over the next six years to nearly $200 million.

The Kitts Green expansion was the second phase of the three-part expansion program by the Company to satisfy customer demand for advanced aerospace products and patented alloys, which allow airframers to build more fuel efficient and lower-cost airplanes vs. composite alternatives. The completion of the Kitts Green expansion was announced at the Paris Air Show.

Alcoa upgraded and expanded casting capacity at the Kitts Green plant and also expanded capacity at its Technology Center in Alcoa Center, PA by 30 percent. The third phase of the expansion is a new $90 million facility under construction adjacent to the Company’s Lafayette, Indiana plant that will provide an additional 20,000 metric tons of aluminum lithium. The new facility will supply round and rectangular ingot for rolled, extruded and forged applications, in sizes compatible with the largest aluminum aerospace components in service today. The Lafayette expansion is scheduled to be completed and online by the end of 2014.

Alcoa’s new aluminum lithium alloys provide the best strength-to-weight performance in Alcoa’s aerospace alloy portfolio combined with better stiffness, damage tolerance, and corrosion resistance. The alloys are used in extrusions, forgings, sheet and plate applications across aircraft structures, including airplane wings and fuselage components. The expansions follow discussions with airframers subsequent to the launch of the alloys.

“We introduced our third-generation aluminum lithium alloys at the last Paris Air Show and demonstrated their potential to increase fuel efficiency, reduce inspection intervals, improve passenger comfort and lower capital costs for aerospace manufacturers,” said Mark Vrablec, President of Alcoa Aerospace, Transportation and Industrial Rolled Products. “The response was phenomenal. In fact, the response indicated demand that exceeded our production capacity at the time, so we launched initiatives to expand our aluminum lithium operations at three locations around the world. The initiative also provided us with the opportunity to increase our aerospace recycling capability for customers to benchmark status in the industry,” Vrablec added.

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