MASSENA Alcoa announced Wednesday that it will permanently close the remaining two antiquated potlines at its Massena East plant in the first quarter of this year, shutting down at least temporarily a facility that has been an aluminum smelter since 1959.
While the company said the move will not affect the $600 million modernization project it plans in Massena, state officials reacted with alarm to the announcement Wednesday, and said an emergency meeting with Alcoa executives will be held today in New York City to discuss the impact on jobs. The East plant has 332 employees one-third of Alcoas Massena workforce.
A statement from Gov. Andrew M. Cuomos office declared that the state would hold Alcoa to the commitment it made to Massena last year in exchange for low-cost electricity from the New York Power Authority.
We intend to enforce the terms of the long-term power supply contract for Alcoas receipt of low-cost hydropower from NYPAs St. Lawrence-Franklin D. Roosevelt Hydroelectric Plant, which requires the company to maintain employment at its plants, the statement said. To be clear, we will hold Alcoa accountable to maintain the operation of the Massena West smelter and ensure the planned modernization of the Massena East facility proceeds without delays as required by the contract.
The agreement calls for Alcoa to maintain 900 jobs in Massena. It employs 1,000 here now, including 669 at the Massena West plant. That facility, which uses more modern technology, will continue to operate, the company stated.
Our goal is to protect jobs while avoiding involuntary layoffs in the north country and nothing less, read the statement from the governors office regarding the talks being held with Alcoa.
The fate of the jobs at the East plant will depend largely on the outcome of those meetings, according to United Steelworkers Local 450 President David W. LaClair Jr.
Until we know the outcome of those discussions, everything remains up in the air, he said.
The decision to close the two potlines was made because they are no longer competitive, said Bob Wilt, president of Alcoa Global Primary Products. We continue to reshape our commodity business to ensure it is positioned for long-term success.
Plant officials shared the news with local officials and employees Wednesday before the public announcement was made.
We will be working with our unions, state, local and other stakeholders to minimize the impact of these changes, Mr. Wilt said. We appreciate the support of the New York Power Authority and will work with them and others to ensure our continuing success at Massena West.
Alcoa spokeswoman Christa Bowers said the closing of the potlines will not change the companys modernization project.
As our contract stipulates, we will conduct a financial review at the end of 2015 and move forward subject to board approval, she said.
The modernization project calls for the construction of a new potline at Massena East to produce 144,000 metric tons of aluminum per year, upgrades to Massena West and modifications to other facilities that will help integrate the two plants and support a new potline.
Alcoa announced in April that it planned to spend $52 million through 2015 for site work and support projects that will begin in June. This is in addition to $40 million that has already been spent on the project.
Local officials said they were disappointed but not surprised by the East potline closures.
It certainly saddens me for the employees and their families, but unfortunately it was not fully unexpected, Massena Town Supervisor Joseph D. Gray said. With reports of Alcoas fourth-quarter losses, it is clear that the economy isnt doing very well and the aluminum business isnt a good one right now from a profit standpoint.
Mr. Gray said Plant Manager Bob Lenney told him the company would start negotiations with the United Steelworkers to minimize the impact of the shutdown on Massena East employees.
Mr. LaClair said, I think the whole community has been expecting it, too.
Once the Massena East potline closure is complete, Alcoa will have total smelting operating capacity of 3,950,000 metric tons, with approximately 655,000 metric tons of capacity idle.
Johnson Newspapers writers Bob Beckstead and Ryne Martin contributed to this report.