Aluminum giant Alcoa Inc. (AA - Free Report) announced that it will expand a plant in Tennessee and boost its capacity to produce aluminum sheet for the automotive industry. Alcoa will spend $275 million on the facility over the next three years to support automotive producers’ plans to use more aluminum sheet to increase fuel efficiency, safety, durability and performance of cars and light trucks.
Alcoa believes that the expansion will add 200 full-time jobs and 400 temporary jobs, which will be created during the construction phase of the expansion. The expansion is scheduled to start this month with completion expected by mid-2015. The expansion will convert some of the plant’s can sheet capacity to high-strength automotive aluminum sheet production.
After the completion of the expansion, the plant will be a key supplier to both the packaging and automotive markets. The project will incorporate Alcoa’s proprietary 951 technology, which is a breakthrough technology and is the new pre-treatment bonding standard for aluminum sheet, extrusion and casting suppliers across the automotive industry.
The 951 technology facilitates wide usage of aluminum throughout the automotive industry and help in making mass-produced aluminum-intensive vehicles possible, thus saving fuel. Recently, Alcoa licensed the pre-treatment bonding technology to Chemetall, a division of Rockwood Holdings, Inc. ), in an exclusive global distribution pact.
Alcoa is the world leader with respect to production and management of primary aluminum, fabricated aluminum, and alumina as well as the world’s largest miner of bauxite and refiner of alumina.
Alcoa currently retains a short-term Zacks Rank #3 (Hold).
Other companies in the mining industry with favorable Zacks Rank are Atlatsa Resources Corporation and Anglo American Platinum Ltd. . Both hold a Zacks Rank #2 (Buy).