Alcoa to cease smelter production

The decision is the result of a European Commission (EC) ruling stating that the extension of Italy’s existing electricity tariff after 2005 does not comply with European Union (EU) state-aid rules and that a portion of the benefit received by Alcoa must be refunded.

The company is appealing the decision. However, it said that, while uncertainty over obtaining future power supply for the smelters at competitive rates remains, the production of its smelters will be temporarily curtailed, affecting 2,000 direct and indirect jobs.

The process to shut down the smelter has already begun and is due to be completed by the second half of December. Alcoa’s rolling mill in Fusina, which is adjacent to the smelter, will not be directly affected by this action.

Klaus Kleinfeld, the company’s president and chief executive officer, said: ‘This is a dark day for European heavy industry. The EC is sending a signal to investors and workers that heavy industry is no longer a priority. Particularly in today’s economic crisis, this decision is hard to understand. Skilled and long-term jobs will be lost, facilities will be closed and companies in Europe will not be able to compete.’