Rio Tinto Alcan cuts more production, workers

Rio Tinto Alcan, facing continuing aluminum price decline, cuts workers, production

HARTFORD, Conn. (AP) -- Global mining giant Rio Tinto Alcan said Tuesday it is making more work force and production cuts in response to plummeting aluminum prices.

The Montreal-based subsidiary of Rio Tinto in London cut aluminum production an additional 6 percent and said it will reduce its global work force by about 1,100, comprising 300 contractors and 800 employees.

Rio Tinto Alcan said it is shutting its Beauharnois smelter and curtailing production at its Vaudreuil alumina refinery in Canada by 400,000 tons. The company also plans to sell its 50-percent stake in the Alcan Ningxia joint venture in China.

The new production cuts represent output of about 230,000 tons.

In addition to production cuts announced late last year, the company is reducing its global output by 11 percent aluminum capacity, or 450,000 tons.

Rio Tinto Alcan said it also will impose a cost savings program across regions as part of a global cost reduction effort announced in December.

"Our goal is to align production with customer demand and reduce our operating costs as much as possible," said CEO Dick Evens.

Shares of Rio Tinto fell $7.73, or 8.7 percent, to $81.04 in afternoon trading. The stock has ranged from $59.20 to $558.65 over the past year.

Shares of other aluminum companies also fell. Alcoa Inc. fell 97 cents, or 10.3 percent, to $8.46. Kaiser Aluminum Corp. fell $1.60, or 6.6 percent, to $22.55. Century Aluminum Co. fell 98 cents, or 11.5 percent, to $7.51. Reliance Steel and Aluminum Co. lost $1.36, or 6.7 percent, to $18.90.