The independents were Alcan's political allies, lobbying for low tariffs on primary aluminum. While Alcan's exports to the United States grew in the early s, market shares in other areas began to shrink. Norway and France doubled their domestic aluminum capacity, while historic importers like Germany and Japan began to develop their own industries. Although overall output increased, Alcan's percentage of world production declined from 21 percent in to 19 percent by By it had slid to 13 percent.
During the summer of a strike at Alcan's Arvida plant idled 45 percent of production capacity for four months, resulting in a loss of about 1, tons of aluminum production per day. Later in the year, recessionary conditions caused a global oversupply of aluminum, and Aluminium Limited's profits dipped for Sales of primary aluminum to U. Alcan decided to bolster its fabrication efforts. In Alcan expanded fabricating operations in plants in 11 countries.
The global oversupply lasted into the early s, however, and as it worsened, U. Alcan slowly was being squeezed out of the U. In response, Alcan decided to build semi-fabricating plants of its own in the United States to establish stable outlets for its ingot. In AL acquired a small U. Alcan and three of its biggest U. Alcan bought out its partners in and also acquired other sheet-fabricating plants owned by Cerro and National Distillers. By Alcan operated 12 plants in 8 U. In Aluminium Limited was renamed Alcan Aluminium Limited, and two years later the company reorganized its corporate structure, with management divided into three groups: raw materials, smelting, and fabricating and sales.
In the late s another fundamental shift occurred in Alcan Aluminium's business. Higher transportation and labor costs eroded the advantage of refining aluminum in Canada, as did the availability of cheaper power in the United States. Political developments around the globe made it advantageous for Alcan Aluminium to build primary smelters in Australia, Britain, India, Norway, and Japan.
By , Alcan Aluminium's foreign smelting capacity equaled that of its Canadian facilities. Alcan Aluminium had begun to develop integrated units within each country of operations. Alcan Aluminium's shift toward finished products continued. In Alcan Aluminium shipped more fabricated and semi-fabricated tonnage than ingot for the first time.
In Paul H. Leman took over as president of Alcan Aluminium Limited. Davis remained CEO and took on the new post of chairman. The French-Canadian Leman was the company's first president outside the Davis family. In global recession brought on by the oil crisis caused a decline in Alcan Aluminium's aluminum shipments by 16 percent worldwide. Profits took a dive as demand fell in all markets except Latin America. Alcan Aluminium continued to build plants overseas, however, adding an alumina refinery in Ireland and participating in the development of new bauxite mines in Brazil in the mid- to late s.
Labor troubles caused the shutdown of four of the company's five Canadian smelters in Another strike three years later had a similar effect on Alcan Aluminium's production levels.
During both of these strikes other producers took advantage of the banner growth years for aluminum. In the mids, plans to expand smelting capacity in Canada were mapped out. Uncertainty about the future of energy costs encouraged Alcan Aluminium and its Alcan subsidiary to take advantage of its own Canadian hydroelectric plants.
In David Culver replaced Leman as president. The executive observed that Alcan Aluminium was the only aluminum producer in the world with the ability to expand by 30 percent without increasing its power costs.
By construction on a new primary smelter in Quebec was well under way. Culver had joined Alcan Aluminium in and had worked his way up the sales side. He set out to bolster Alcan Aluminium's marketing efforts and strengthen the emphasis on fabricated products, eventually limiting ingot sales to 25 percent of the total. Culver initiated a new research and development push in Alcan Aluminium lagged in high-margin aerospace, automotive, and beverage container markets due to dated technology.
The company was in a very strong financial position to face the next decade. Annual revenues had doubled since and earnings had increased eightfold. Debt was low. Alcan Aluminium's financial strength proved a blessing when the recession of to reached the aluminum industry.
Demand fell sharply. Several long-term factors came to a head in the s. Increased use of scrap resulted in lower aluminum prices and new Third World producers entered the market in force. By their share was 40 to 50 percent.
This Canadian firm, formed in , served the U. In , seeking to enter the U. Although none of its plants were situated in Cleveland, Alcan chose the city as its American headquarters moving into Erieview Plaza in because of its strategic location in America's industrial market. At the time of its formation, Alcan had already established itself as a producer of aluminum sheet and plate, cable, and powder.
Historica Canada. Article published February 06, ; Last Edited November 21, The Canadian Encyclopedia , s. Thank you for your submission Our team will be reviewing your submission and get back to you with any further questions. Thanks for contributing to The Canadian Encyclopedia. Article by Niko Block. Alcan Incorporated was a major Canadian aluminum mining and manufacturing corporation.
From the early s to the early s, it was the second-largest aluminum producer in the world. It was established as the Canadian subsidiary of the Aluminum Company of America Alcoa , one of the founders of which invented the process for extracting aluminum from bauxite.
Northern Aluminum was renamed the Aluminum Company of Canada in , and in , it formally detached from Alcoa. In , it was again renamed, this time as Alcan Aluminum Limited becoming Alcan Incorporated in Rock containing high concentrations of aluminum is known as bauxite. Photo taken on 12 April Previous Next. Alcan rejected the Alcoa bid many times, calling it inadequate. In withdrawing its offer, Alcoa said it had better ways of boosting shareholder value.
Alcoa said it was reinstituting its share repurchase program, which had been suspended while the Alcan bid was open. SA and Rio both made offers for Alcan before being asked for second and final bids by Tuesday night, according to people familiar with the situation.
CVRD said in a statement it was not ruling out a bid for Alcan in the future but was not currently in talks. VX and Societe Generale. Alcan is being advised by Morgan Stanley MS.
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