Global Fastener News

Alcoa to Sell Automotive Fastener Business

John Wolz

Alcoa Inc. announced it will sell its automotive fasteners businesses as part of a restructuring which includes eliminating 8,000 jobs.\
Alcoa just completed acquisition of Fairchild Fasteners, an aerospace fastener manufacturer, and combined it with Huck International to form Alcoa Fastening Systems.
The company reported it has reviewed its businesses and will spin off those �that do not deliver superior returns.�
Huck has an automotive division.
Aluminum producer Alcoa entered the fastener business in 2000 with the acquisition of Cordant Technologies Inc. Cordant owned Huck and fastener manufacturers Jacobson Mfg. Co. Inc. and Continental/Midland Group. Alcoa acquired Midwest Fastener Corporation in 2001.
The restructuring follows the announcement that Alcoa�s fourth quarter losses were worse than anticipated. Alcoa reported a $223 million loss as revenue slipped to $5.06 billion for Q4 from $5.10 billion for the final quarter of 2001.
The loss was worse than predicted by analysts and wider than the $142 million loss for the same period of 2001.
Aluminum producer Alcoa said it will continue its cost-cutting program by reducing its global work force by 6%.
CEO Alain Belda said global manufacturing weakness �has persisted longer than we anticipated. In particular, aerospace, industrial gas turbine and telecommunication markets remained soft, reinforcing the need to increase the scope of our cost savings.�
Alcoa, which had 127,000 employees at the end of 2002, said most of the job cuts will be in Europe and South America.
Alcoa already had begun cost-cutting efforts in 2002 and reported a cost savings of $600 million, with a goal of cutting $1 billion in 2003.
In addition to selling its automotive fasteners business, Alcoa will puts its specialty chemicals and packaging equipment operations in North America and some fabricated operations in South America up for sale. The businesses to be sold generated about $1.3 billion in sales during 2002. Proceeds will be used to reduce debt.
Alcoa�s stock price fell from $35.55 at the end of 2001 to $22.78 at the end of 2002. �2003 FastenerNews.com