Alcoa set to close aluminium smelter at Point Henry

UPDATE: ALCOA has announced it will permanently close its Point Henry aluminium smelter near Geelong, shedding almost 1000 jobs.

ALCOA has announced it will permanently close its Point Henry aluminium smelter near Geelong in August, shedding almost 1000 jobs.

The aluminium giant will also close its rolling mill in Geelong, along with a second rolling mill in Yennora, NSW.

The dramatic move, first revealed by the Herald Sun this morning, will affect 980 workers across the three sites.

The closure of the smelter will further devastate the Geelong community.

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In a statement, Alcoa said a strategic review found that the 50-year old Point Henry smelter had no prospect of becoming financially viable.

Meanwhile, the two rolling mills had been impacted by excess capacity in the Australian and Asian markets.

Alcoa will close its Point Henry aluminium smelter in August.

Workers arrive at the Point Henry smelter this morning. Picture: Alison Wynd

“We recognise how deeply this decision impacts employees at the affected facilities and are committed to supporting them through this transition,” said Alcoa CEO Klaus Kleinfeld.

“Despite the hard work of the local teams, these assets are no longer competitive and are not financially sustainable today or into the future.”

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Australian Workers’ Union Victorian secretary Ben Davis, who was at the announcement by Alcoa this morning, said it was “devastating for 800 people, their families and the community”.

“This is another devastating blow for Geelong,” he said.

“State and federal governments need to intervene now.”

Mr Davis said big jobs losses at major companies had come in quick succession, and were akin to the effects of the SEC privatisation on the Latrobe Valley in the 1990s.

He said intervention was needed now because today Victorians faced “a much harder jobs market than it was then” in the 1990s.

The closure will affect almost 1000 workers.

Federal Treasurer Joe Hockey said the decision was $40 million in taxpayers money “down the tube”.

He said it was “disappointing but predictable” because it was unviable and showed the Government had to be very careful about giving money to business.

Mr Hockey said the Government could not “resuscitate” or rebirth a business like Alcoa, Toyota or Holden but said there would be a “new dawn” for sacked workers.

He was angry the smelter had closed just two years after being given $40 million by the former Labor Government.

“ (It’s) $40 million of taxpayer money down the tube. Gee whiz there’s a lot of small businesses out there that could have done with that sort of help,” he said.

“The Labor government gave them $40 million and they close two years later. It just illustrates the fact that you’ve got to be very careful with taxpayers money and now we’ve all got to work together to find new business opportunities for the workers and contractors.”

The company said only last night that it had made no decision on the smelter’s future.

Opposition Leader Bill Shorten said it was devastating news for Alcoa workers and their families.

“It is very saddening news for families in Geelong. This city has been amongst the hardest hit by job losses in the car manufacturing industry – today’s announcement will cut deep,” he said.

“It’s clear that a global oversupply of aluminium, dramatically falling aluminium prices and a high Australian dollar made the continuation of these operations impossible.”

Mr Shorten called on the Abbott Government to provide adjustment packages for regions and a transition assistance for workers.

“We need a plan for these workers, just like we need a jobs plan for the tens of thousands of car industry workers and others who are losing their jobs.”

Australian Manufacturing Workers Union boss Paul Howes said the closure was not the fault of the Government and he was not interested in point scoring.

“There’s nothing the Government could have done,” he said.

Mr Howes called for a new plan from government.

Earlier today, before the announcement by Alcoa, Premier Denis Napthine said jobs were being created in the Geelong region.

He pointed to the decision to shift WorkSafe offices to Geelong, and the national disability care headquarters that would be built there.

But Opposition Leader Daniel Andrews said the closure was part of a “jobs crisis in Victoria”.

“Ford, Holden, Toyota and now Alcoa. How many thousands of jobs will have to go before Denis Napthine realises he needs to get a jobs plan?” he said.

Devastating news about Alcoa. I have called an emergency meeting with local MPs at City Hall to do all I can for Geelong.@DarrynLyons

— Geelong Mayor (@Geelong_Mayor) February 17, 2014

Alcoa said it would seek a buyer for its Anglesea coal mine and power station in the hope it would operate independently after the smelter closes.

A smelter at Portland and mining operations in Western Australia would continue as normal.

“These are hard decisions to make,” said Alcoa of Australia managing director Alan Cransberg.

“We understand how difficult this is for our employees and their families, our contractors, suppliers and community partners.

“Everyone has worked hard to improve the competitiveness of the smelter and rolling business. “They are part of a proud history of Alcoa in Australia over the last 50 years and part of the significant contributions we have made to the Australian economy and local communities.

“We appreciate the ongoing support of the Australian and Victorian governments and will continue to work closely with all levels of government, our employees, unions and community stakeholders to manage through these changes.”

Alcoa had said only last night that it wasn’t ready to reveal the face of its plan.

The future of the plant has been under a cloud for months, with US aluminium giant Alcoa reviewing the plant’s operations.

The company has previously said it would make a decision on the plant’s future by the end of next month.

Alcoa received a $40 million grant from the former Federal Labor Government in 2012, but last month said it was not seeking any further Government assistance for the Point Henry plant, sparking speculation that its fate had been sealed.

The potential closure of the smelter would be another heavy hit to the Victorian manufacturing industry.

Just nine days ago, Toyota announced it would pull out of Australia in 2017, costing 2500 Victorian jobs.

Alcoa spokeswoman Nichola Holgate said last night no decision had been made about the future of Point Henry.

Asked if there was to be an announcement today, she replied: “not to my knowledge’’ and said the company was committed to advising its employees about the plant’s future by the end of next month.

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- with Ellen Whinnett, AAP