Aluminium producer Alcoa is to cut 8,000 jobs - 6% of its workforce - as it struggles to cope with low prices and weak demand for gas turbine components.
The job losses will come from businesses serving the aerospace, automotive and industrial gas turbine markets, and in its US smelting plants.
The US company has reported a $223 million loss for the fourth quarter of 2002, including a $95 million after-tax charge to cover the restructuring.
This is Alcoa's second major restructuring since 11 September 2001. In late 2001 the company announced it was cutting 6,500 jobs, and in July last year Alcoa was forced to cut its aluminium production capacity, but completed the acquisition of Fairchild Fasteners at the end of 2002.
The latest restructuring includes the divestment of non-core businesses that generated approximately $1.3 billion of the company's $20.3 billion in sales last year.
Alcoa's revenues were down 10% over 2001. In the segments most affected by the cutbacks in commercial aircraft and engine production, flat-rolled and engineered products, sales were down by 7% and 13%, respectively.
By the end of 2002,Alcoa had achieved annualised cost savings of $600 million, with the goal of reaching $1 billion a year in 2003. Savings from the latest cuts will be realised in 2004, according to the company.
Source: Flight International
