Alcoa Opens World’s Largest Aluminum-Lithium Aerospace Plant in Indiana

October 2, 2014

Expansion to Capture Rapid Aluminum-Lithium Demand Growth

  • $90 million advanced manufacturing facility is largest of Alcoa’s three aluminum-lithium expansions
  • $100 million in revenues for 2017 already contracted
  • Growing demand for advanced aluminum-lithium alloys for lighter, more fuel-efficient, lower-cost aircraft
  • Alcoa holds the number one market position in aluminum-lithium extrusions and offers the broadest portfolio of aluminum-lithium products;
    Supplies aircraft such as A380, A350, 787 and G650
  • 75 new jobs in Indiana where Alcoa employs more people than in any other state

Alcoa (NYSE:AA), a global leader in lightweight metals technology,
engineering and manufacturing, today is officially opening the world’s
largest aluminum-lithium plant in Lafayette, Indiana where it produces
advanced, third-generation aluminum-lithium alloys for the aerospace
industry. Aircraft manufacturers are increasingly turning to lighter and
stronger aluminum-lithium alloys, which are less expensive than titanium
and composites and enable better fuel efficiency and lower maintenance

“The future of aviation is being built with aluminum-lithium, and Alcoa
is making big moves to capture that demand,” said Klaus Kleinfeld, Alcoa
Chairman and Chief Executive Officer. “This state-of-the-art facility
positions Alcoa as the world’s premier aluminum-lithium supplier,
offering the broadest portfolio of aluminum-lithium components for next
generation aircraft.”

To keep pace with demand, the Company has expanded its aluminum-lithium
capabilities at the Alcoa Technical Center outside Pittsburgh, at its
Kitts Green facility in the United Kingdom, and in Lafayette. Already,
Alcoa has contracted $100 million in aluminum-lithium revenues for 2017.

Alcoa’s Lafayette cast house, located next to its extrusion plant, can
produce more than 20,000 metric tons (44 million pounds) of
aluminum-lithium annually—making it the largest facility of its kind in
the world. Alcoa’s materials scientists invented a majority of the
alloys produced at the facility as well as the casting equipment and
processing technology. The Company offers the most complete portfolio of
aluminum-lithium products, including extruded, forged and rolled parts.
It has the number one market position in aluminum-lithium extrusions and
a significant position on the Airbus A380, Airbus A350, Boeing 787, and
Gulfstream G650. Alcoa produces single-piece wing skins, including for
wide-body airplanes, fuselage skins, wing stringers, floor beams, seat
tracks and other components. The Company also is developing the first
ever aluminum-lithium forging for a front fan blade
for Pratt &
Whitney’s PurePower engines.

The Lafayette facility is uniquely capable of making the world’s largest
aluminum-lithium ingots—approximately 50 percent larger than the nearest
competitor, and big enough to make any single-piece component on today’s
aircraft. Complementing that capability, Alcoa operates the world’s
widest, 220” rolling mill at its facility in Davenport, Iowa, making it
the only company capable of producing single-piece aluminum-lithium wing
skins for the largest commercial airplanes. Single-piece parts make
structures stronger, lighter and less expensive because they minimize
the number of complex joints.

Ribbon Cutting

Indiana Lieutenant Governor Sue Ellspermann, Lafayette Mayor Tony
Roswarski, and other state and local dignitaries today are joining Alcoa
executives, employees and community members to celebrate the plant
opening which will create 75 new jobs, on the eve of Manufacturing Day

“Indiana is home to some of Alcoa’s most advanced facilities, including
two that serve the growing, global aerospace industry,” said Indiana Lt.
Gov. Sue Ellspermann. “Indiana is a ‘state that works’ for innovation in
the aviation industry. Alcoa is building upon our state’s strong
manufacturing tradition, creating even more good-paying jobs that will
engage a skilled Indiana workforce.”

The Indiana Economic Development Corporation (IEDC), the city of
Lafayette and Tippecanoe County provided various tax incentives.
Together, the local and state incentives are worth more than $6.2

“We are proud to be a partner with Alcoa on this state-of-the-art
aerospace facility,” said Mayor Tony Roswarski. “Greater Lafayette has a
long history of innovation, invention and manufacturing and we are
building on that today with this new plant, which also will raise our
global profile.”

Alcoa in Indiana

Alcoa employs approximately 3,200 people at three locations in Indiana,
more than in any other US state.

This is Alcoa’s second aerospace announcement in Indiana in five months.
In May, the Company announced
a $100 million expansion
at its LaPorte facility where it will
produce nickel-based superalloy jet engine parts. The expansion will
create 329 jobs by 2019.

Reinforcing Alcoa’s commitment to Indiana and in celebration of the new
cast house, the Alcoa Foundation is granting $75,000 to Ivy Tech
Community College—Indiana’s largest public postsecondary institution and
the nation’s largest singly accredited statewide community college
system serving nearly 200,000 students annually. The funds will create a
scholarship program to educate individuals who are interested in a
manufacturing career, but lack the necessary skills and credentials. By
June of 2015, the scholarship program from the Alcoa Foundation will
certify 130 individuals.

Benefits of Aluminum-lithium

Lithium is the world’s lightest metallic element. When alloyed with
aluminum and other metals, the material provides an outstanding
combination of strength, toughness, stiffness, corrosion resistance, and
high-temperature performance, and at a lower cost than titanium or
composites. As a result, Alcoa’s aluminum-lithium materials:

  • lower the weight of single-aisle fuselage applications by up to 10
    percent versus composites;
  • lower the cost to manufacture, operate and maintain planes by up to 30
    percent versus composite-intensive airplanes, and at significantly
    lower production risk;
  • contribute to 20 percent better fuel efficiency; and
  • deliver passenger comfort features equivalent to composite-intensive
    planes, such as higher cabin pressure, large windows and higher

Alcoa supplies aluminum-lithium products to all major airframe
manufacturers. Beyond aviation, Alcoa supplies aluminum-lithium products

  • Space applications, including on the ULA rocket and developing
    applications for Space X;
  • Automotive applications, including parts for commercial trucks,
    high-performance sports cars and Formula One cars; and
  • Military applications.

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About Alcoa Aerospace

At the forefront of every major milestone in aerospace history, Alcoa
collaborates with customers to continually advance aviation through its
lightweight, high-performance metal innovations. The Company innovates
aerospace solutions across structures, engines, and fastener
applications. In 2013, Alcoa generated $4 billion in aerospace revenues
from four value-add businesses: Alcoa Forgings and Extrusions, Alcoa
Power and Propulsion, Alcoa Fastening Systems and Alcoa Global Rolled
Products. Alcoa is aggressively transforming its portfolio by building
out its value-add businesses to capture profitable growth and by
creating a lower cost, highly competitive commodity business. In June
2014, Alcoa announced that it signed a definitive agreement to acquire
Firth Rixson, a global leader in aerospace jet engine components, from
Oak Hill Capital Partners. The acquisition is expected to close by the
end of 2014.

About Alcoa

A global leader in lightweight metals technology, engineering and
manufacturing, Alcoa innovates multi-material solutions that advance our
world. Our technologies enhance transportation, from automotive and
commercial transport to air and space travel, and improve industrial and
consumer electronics products. We enable smart buildings, sustainable
food and beverage packaging, high-performance defense vehicles across
air, land and sea, deeper oil and gas drilling and more efficient power
generation. We pioneered the aluminum industry over 125 years ago, and
today, our 60,000 people in 30 countries deliver value-add products made
of titanium, nickel and aluminum, and produce best-in-class bauxite,
alumina and primary aluminum products. For more information, visit,
follow @Alcoa on Twitter at
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Forward-Looking Statements

This press release contains statements about future events and
expectations, or “forward-looking statements,” all of which are
inherently uncertain. Forward-looking statements include those
containing such words as “anticipates,” “estimates,” “expects,” “plans,”
“should,” “may,” “will,” or other words of similar meaning. All
statements that reflect Alcoa’s expectations, assumptions or projections
about the future other than statements of historical fact are
forward-looking statements, including, without limitation, forecasts
regarding aluminum lithium demand growth, the expected timing for
completion of the Firth Rixson acquisition, and planned increases in
employment levels in Indiana. Forward-looking statements are subject to
risks and uncertainties and are not guarantees of future performance.
Important factors that could cause actual results to differ materially
from those expressed or implied in the forward-looking statements
include: (a) unfavorable changes in the markets served by Alcoa,
including the aerospace market; (b) failure to successfully implement,
or to realize expected benefits from, new technologies, advanced alloys,
including aluminum lithium, processes, or innovative products, in each
case as expected or within the time periods anticipated; (c) failure to
receive, delays in the receipt of, or unacceptable or burdensome
conditions imposed in connection with, all required regulatory approvals
and the satisfaction of the closing conditions to the proposed
acquisition of the Firth Rixson business; and (d) the other risk factors
discussed in Alcoa’s Form 10-K for the year ended December 31, 2013,
Forms 10-Q for the quarters ended March 31, 2014 and June 30, 2014, and
other reports filed with the Securities and Exchange Commission. Alcoa
disclaims any intention or obligation to update publicly any
forward-looking statements, whether in response to new information,
future events or otherwise, except as required by applicable law.

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