The Australian Workers’ Union (AWU) has called for State and Federal Government action following Alcoa’s announcement that it is "reviewing the future viability" of its Point Henry smelter.
Alcoa yesterday announced that it was carrying out a review on whether to keep the facility open, close it, or to cut production at the smelter.
It stated that "the current global economic conditions are severely impacting the aluminium industry, with various companies, including Aloca, announcing the review, closure, or curtailment of smelters in Australia and overseas.
"The current situation makes it difficult for Point Henry to be globally competitive in the foreseeable future."
The AWU has hit out at the announcement, with Victorian secretary Cesar Melhem saying "if Alcoa had reinvested some of its profits into the plant it would not be under threat now. It is an ageing facility which has been treated with corporate contempt".
Melhem said that a number of jobs were at risk, particularly after the company’s statement that its review could ‘curtail’ the operations, raising fears of mass layoffs.
Regarding the future of the its workers, Alcoa of Australia’s managing director Alan Cransberg, said I know this is unsettling news that creates uncertainty for our employees and the many people that depend on the smelter for their livelihood".
"We will do all we can to ensure the smelter is competitive."
Consensus amongst workers, the AWU, and local representatives is that the plant should have been upgraded.
One worker, Paul O’Brien, told the AFR while the company had recently built a new tower there have been no major upgrades in years.
"The company’s lack of investment in Point Henry amounts to exploitation of the people of Victoria, and of Geelong in particular," Melham added.
He called on the Government to act.
"There should be urgent talks at the highest levels of government to prevent this major employer and exporter from doing a slash and burn without consideration for the workers and the state that has supported it."
Opposition leader Tony Abbot yesterday pointed to the carbon tax as a cause of the plant’s review, however Alcoa denied this, stating "a combination of factors, including metals prices, input costs and exchange rates have resulted in the Point Henry smelter becoming unprofitable".
This smelter is just the latest to look at potential closure, as Norsk Hydro slashes jobs at its Kurri Kurri smelter in NSW and Rio Tinto has announced the wholesale divestment of its Australian and New Zealand aluminium assets as they no longer ‘aligned’ with the company strategy.
The divested assets included the Gove Bauxite mine and alumina refinery; the Boyne smelters and the Gladstone Power Station; the Tomago smelter; and the Bell Bay smelter, while in New Zealand it will divest the New Zealand aluminium smelters.
AWU national secretary Paul Howes said nearly 5000 workers were employed in Rio’s five Australian facilities.
Xstrata has also announced plans to shut its copper smelting and refining operations in Townsville and Mount Isa.
Despite the rough market for smelters and refineries, Alcoa stated that its Portland smelter will not be under review.