Object ID: 770688
Headline: Airbus project boosts Alcoa
Byline: Quad-City Times Staff
Source: Answer Book
Publication Date: August 22, 2004
Page: 21

Already a key supplier to the aerospace and automotive industries, Alcoa Davenport Works now is embracing a significant role in the development of the new A380, a 550-seat aircraft being produced by Airbus.

The project promises to increase production levels at the plant, thanks to its role as a key supplier for what will be the world's largest airliner, currently under production in France. The Davenport Works – which actually straddles Bettendorf and Riverdale – is producing the aluminum skin for the plane, new metal for the fuselage and the wing plates – the largest ever made.

The Davenport Works is now in its 56th year of production. In addition to making sheet and plate products for the aerospace and automotive industries, it also produces specialty aluminum products for some 750 customers, including Boeing, Bombardier, Ford, General Motors, Nissan, Chrysler and others.

Over the past year Alcoa has added about 200 new employees – largely because of the Airbus project - bringing the plant's workforce to 2,200. Alcoa officials have estimated that Davenport Works adds about $1 million a day into the local economy through its payroll, taxes, the contractors it employs and its local suppliers. It also is the largest single-point user of electricity on the MidAmerican Energy's entire grid.

With the world's largest rolling mill, the plant has the ability to make products to more than 11,000 specifications. A new expansion, completed in 2003, both increased its capacity and improved its efficiency. The project added a new state-of-the-art horizontal heat treating furnace, plate stretcher and supporting equipment. The A380 project and the boost in employment are allowing the plant to fully leverage the expansion, plant officials said.

Object ID: 757270
Headline: Alcoa, Airbus to partner Davenport Works to support world's largest aircraft
Byline: Jennifer DeWitt
Source: Quad-City Times
Publication Date: June 30, 2004
Page: A1

Development of the world's largest airplane by the European Airbus company is translating into a strong future for Alcoa's Davenport Works, the plant's 2,100 employees and the Quad-City community and economy.

With more than 250 employees on hand Tuesday, as well as a contingent of area business, economic development, local and state government leaders, company officials celebrated the partnership between Airbus and Alcoa's plant in Riverdale, Iowa, that eventually will give flight to the Airbus A380, the world's largest commercial aircraft. The 550-passenger aircraft will utilize a full twin-deck design and offer amenities not seen before in a commercial aircraft.

"We're here to celebrate today. The A380 is going to be the flagship of the 21st century," Airbus North American chairman Allan McArtor told the packed house inside the Alcoa Learning Center. "Airbus could not build the A380 without the significant support of American aerospace companies."

Although Alcoa - through the Davenport Works and some of its other facilities - is not the only U.S. supplier for the landmark project, Alcoa aluminum and its work can be found from the nose to the tail of the plane. The Davenport Works' contributions include the wing plates and fuselage skin, the largest ever produced at the Quad-City plant.

"Every new aircraft presents a series of unique technical challenges," said Bob Wetherbee, the Alcoa Mill Products president. "To meet these challenges, we have developed more new Alcoa alloys and products than any other aircraft in our 100 years of aviation history."

But Alcoa's role is much more than that of a traditional supplier, McArtor said. "Alcoa is one of our critical suppliers. They have been with us for a long time and developed a relationship with Airbus. … We rely on each other.

"With Alcoa, we give them challenges and they come to us with engineering solutions, state-of-the-art (solutions) that no one else can do," he said, adding that Alcoa is unique in not only providing what will be the largest wing in the world but also its Alcoa Fastening Systems producing the 1 million fasteners, or bolts, that will be used on each plane.

In addition to Alcoa Mill Products, which includes the Davenport Works, Alcoa's other aerospace businesses include: Alcoa Europe Rolled Products, Alcoa Fastening Systems, Alcoa Engineered Products, Alcoa Wheel and Forged Products, Latin American Rolled Products and Alcoa Howmet Castings. The businesses supply Airbus as well as the rest of the aerospace industry with aluminum sheet and plate, extrusions, fasteners, forgings, structural castings and propulsion components such as turbine blades.

Employment for a long time

"This is a very unique project because very few models of new planes get introduced," Wetherbee said. "This is the largest plane ever made and the largest that may ever be made."

For many Davenport Works employees, the A380 is the largest plane they have been part of since the Boeing 747, which was first introduced in the 1960s, he said. Some of the most senior employees may even remember the Boeing 737.

But with Airbus expecting to produce the plane for the next 30 or 40 years, "it means a lot of the work for these people will be this plane," David Venz, the vice president of Airbus North America, said of Alcoa employees. "If you started working at Alcoa today, your whole career could match (the production of) this airplane."

In fact, the Davenport Works is counting on the project's growth to drive its own. "We have added nearly 100 jobs in the last few months to meet increasing demand for our products," Wetherbee said. "Helping Airbus meet the demanding A380 range, operating and cost targets also helps to sustain the more than 2,100 jobs we now have at this location."

Over the past year, he added, 200 new employees have been hired at the Riverdale plant, including 100 recent hires. The boost in employment has "allowed us to leverage the expansion we added about Sept. 11 (2001)."

The project, which added aerospace capacity to Davenport Works, was purposely slowed down after the terrorist attacks caused an immediate decline in air travel that still has airlines struggling to recover. The expansion was completed and became operational in 2003, about a year later than first expected.

But with a large number of retirements expected in the coming years and "with this type of growth, we'll have to (add more jobs). If we do things right with the A380, it could provide employment for a long time here," Wetherbee said.

'In-sourcing' in the U.S.

In addition to celebrating Alcoa's role, Airbus officials also illustrated the European company's commitment to the U.S. aerospace industry.

"The A380 is going to create a lot of jobs, not only for the next generation of Alcoa employees, but for those in many other companies as well," McArtor said, adding that 50 percent of the components and systems on the A380 are from U.S. firms.

The first A380 is in production at factories across Europe. It is slated for testing in 2005 and delivery to the first customer, Singapore Airlines, in 2006.

"Airbus spends more than $5 billion annually in the United States, which equates to around $15 million a day," he said. The investment, he added, supports more than 100,000 U.S. aerospace jobs.

"While out-sourcing is an issue for so many today, Airbus is delighted to be among those companies who are 'in-sourcing' high-technology jobs," he said. "We also are value-sourcing. We go where the best product is and the best value. That leads us to the U.S. and Alcoa."

Airbus' investment will increase as the A380 moves into full production. McArtor said production probably will begin slowly, one a month, then two per month and eventually three a month.

Wetherbee said Davenport Works will produce and ship enough metal for six of the planes this year and "it will ramp up next year."

Currently, the A380 project is just a small part of Alcoa's aerospace revenues, he said. "But by 2007, it could be 30 to 40 percent of Mill Products' aerospace business."

Already - without one plane built - Airbus has firm orders for 129 of the aircraft, McArtor said, calling it one of the most successful new launches in history.

The A380, an $11 billion development project for Airbus, will continue to fuel its competition with Boeing. Last year, for the first time, Airbus outdid its rival in the number of planes sold and delivered, he said, adding, "We expect it to be a 50-50 market."

Nonetheless, to go from having none of the market to 50 percent in three decades is an accomplishment the company is proud of, he said.

Job security

Many of the Alcoa employees who produce the aluminum that will become the A380 say they are equally proud to be part of the project.

"It signifies that there is a future for Alcoa Davenport Works," said Reggie Reed, a 27-year employee.

"A lot of times you come to work and you don't know (the future) with all the plant closings," added Reed, who works in the roll shop. "It's been a lot of years since we've had something this big."

Ronald Sumrall, another 27-year employee, agreed. An employee in the ingot plant, he is proud to be at the front end of the production cycle. When he sees the final product leave the plant, he knows "we took it from a bunch of nothing and turned it into a solid."

During the ceremony, Penny Brown, representing her fellow Alcoa workers, presented McArtor with a paper scroll signed by the Davenport Works employees "who have a hand in making Airbus products everyday."

"We're very excited to be on board the A380," she said.

Jennifer DeWitt can be reached at (563) 383-2318 or jdewitt@qctimes.com.

Object ID: 755654
Headline: AIRBUS A380 WILL SOAR ON WINGS FROM DAVENPORT
Byline: Jennifer DeWitt
Source: Quad-City Business Journal
Publication Date: July 01, 2004
Page: 1

After weathering a severe decline in the aerospace industry, Alcoa Davenport Works now is poised to be riding high for several years to come, thanks to its key supplier role in the new A380, a 550-seat aircraft being developed by Airbus.

The superjumbo, double-decker airliner – more than a decade in the planning – is being touted by the European Airbus as the "flagship of the 21st century."

And Alcoa's Davenport Works plant in Riverdale, Iowa, finds itself on the ground floor of production. The first A380, which features a twin-deck and twin-aisle design to achieve the record capacity, currently is under production in France. Test flights are scheduled for early next year.

"Competition to be on this airplane has been intense," says Dave Venz, vice president for Airbus North America. "This is an airplane … while it's a European company (building it), companies all around the world are participating in the building of this airplane, and no company is more represented than those in the United States. About half of this plane is coming out of the U.S."

It is especially significant for the aluminum maker's Quad-City plant, whose contributions include producing the aluminum skin of the plane, new metal for the fuselage and the wing plates. According to Venz, Davenport Works "is the only such mill that produces sheets of aluminum the width we need to build this airplane."

Other Alcoa companies located outside the Quad-Cities also are playing a key role in supplying materials, including Alcoa Fastening Systems in Torrance, Calif. Venz says the plant will produce the 1 million fasteners, or "very sophisticated bolts," required to produce each plane. Alcoa also is building the spars for the wings, as well as blades for the jet engines.

"So Alcoa is on this airplane in a very big way," he says.

Venz adds that Airbus is spending $5 billion per year with U.S. aerospace companies, or $15 million per day. In addition to Alcoa aluminum, U.S. companies are represented on everything from engines to electronic systems, fuel systems, landing gear, brakes and instrumentation.

With all the debate over sending jobs overseas, he says, "Here's a company, Airbus, and we're insourcing."

Local impact

"New planes don't come along very often. A new plane that's successful tends to be an important thing for companies that supply the industry like us," says John Riches, Alcoa spokesman. "It tends to be good for us for 10 or 20 years.

"This plane – because of its size and the need to try to reduce weight – probably uses more aluminum alloys than any other plane," he says. "… It has been a real partnership to develop different alloys and solutions to allow this huge plane that carries 550 people to get off the ground and be the aviation flagship of the 21st century as everyone thinks it will be."

For about the past three years, Davenport Works has been producing small quantities of aluminum for the A380. "It's not production volumes. It's a piece of this and a batch of that to determine if this alloy works better," he says. However, some of the pieces measure as long as 130 feet.

According to Riches, it is too early to predict what full production will mean in terms of the volumes for Davenport Works. But it has been an important research and development project for the past three years. "We're not an R&D facility, we're a production facility, but we do R&D here," says Riches, adding that engineers and scientists with the Alcoa Technical Center – near Pittsburgh, where Alcoa is headquartered – also are an integral part of the research. But their ideas and solutions must be viable on the production end, he says.

While Alcoa's participation on the A380 is no different than it what it would offer to do for its automobile or commercial transportation customers, Riches says this has been the largest single project from an R&D perspective for the company.

"Not all of our competition is in the position to do the kind of development work necessary for a plane like this," he says.

Alcoa traces its aerospace roots to the Wright Brothers' first flight on Dec. 17, 1903, near Kitty Hawk, N.C. "There was aluminum in the engine," Riches says. But it also has been a part of aviation history as part of the space shuttles, the Boeing 747 and 777.

Expand capacity, not flights

First announced in the early 1990s, the A380 will become the largest aircraft in the world – taking away the honors from the 747 produced by Boeing, Airbus' only competition in large airplane manufacturing.

Capable of carrying more passengers and freight than any plane in the skies today, Airbus sees the new aircraft as the answer to accommodating the projected growth in air travel. "There is a need for it, if you look at what traffic passenger projections are over the next 20 years," Venz says.

"There's no room to build major airports in major markets anymore, and they can't continue to just add flights," he says, adding that passenger numbers are expected to double in the next 15 years and triple in 20 years. "There isn't space in the air or airports … so the solution is to build bigger planes."

According to Venz, the company spent the first several years of its planning stage presenting the idea to airlines to see "what it should be like, what they want."

But it officially was launched three years ago. The first plane will be delivered in 2006 to Singapore Airlines, which has bought 10 of the aircraft. Other airlines that have placed orders for the A380s include Lufthansa Group, Emirates, Air France, Virgin Atlantic, Qantas, Malaysia Airlines and Korean Air. FedEx also recently bought the cargo version of the A380.

Airbus' line

The life of an airplane tends to be 30 to 40 years, Venz says. "Eventually, it gets to the point where you need to start with a clean sheet of paper and build a new airplane." The closest aircraft of comparable size is the Boeing 747, which is about 40 years old.

Airbus produces 12 different aircraft models with seating that ranges from 118 to 550 people. The company was founded 34 years ago as a European consortium of French, German and, later, Spanish and U.K. companies in an effort to compete with the giant U.S. airline manufacturers.

Today, the Toulouse, France-based company employs 50,000 people throughout the world, though all its manufacturing is in Europe. Its U.S. operations include the North American headquarters, in Herndon, Va., minutes from Washington, D.C., and Washington Dulles International Airport; a spare parts center in Ashburn, Va.; a pilot training center in Miami; and its newest and largest facility, an engineering center in Wichita, Kan., which opened in 2002 and employs 140 engineers working on the A380, according to the company's Web site.

More than 3,300 Airbus aircraft are in service today. Airbus' supplier network is 1,500 strong in 30 countries, including 800 in the U.S.

Competition is stiff

Because of its size, the new A380 will be used primarily between major hubs such as New York, London, Los Angeles, Beijing, Hong Kong and Paris, Venz says. In fact, any airline now flying a 747 is a potential buyer for the new aircraft. "We expect to build a lot of these airplanes," he says.

"We sold 129 before production even began," Venz says, adding that the business plan calls for selling 250 to break even.

But Airbus' success will trickle down to suppliers such as Alcoa, which now is bracing for its aerospace industry to improve in the next 12 to 18 months – earlier than first expected.

"Our business has been improving, and this (A380) certainly is a piece of that," Riches says. "We're clearly not back to the employment we were before 9/11."

Before the terrorist attacks sent the airline industry into a tailspin, Alcoa employed 2,400 people at its Davenport Works plant. But with lower demand for its products, it was forced to trim staff through layoffs, job eliminations, attrition and early retirements. Davenport Works' employment level dropped as low as 2,000 to 2,050, Riches says.

"No one is left on layoff now. We've hired 100 employees to replace some of those gone through attrition, and we're increasing the work force," he says, adding that employment currently is at 2,150.

Still, Alcoa knows competition is as real in the aerospace industry as it is in other sectors. "We've got competition domestically and internationally," Riches says. "We have to be cost-competitive, be able to deliver on time and provide service they can't get anywhere else."

As Alcoa increases its foothold in Europe, there are even other Alcoa operations that are supplying the aerospace industry that could someday compete with the Riverdale operation.

"But aerospace companies want to source materials in the areas they are going to be selling their machines," he says of the U.S. market.

The capability to meet demands for increased production is not enough though, he adds. "Now the issue is not just working more time. We have to be more productive. When you improve production, it helps us be more cost-competitive too.

"We've made improvements (in productivity), but not as much as we need to," he says. "It's an on-going journey to improve productivity and efficiency."

Alcoa's successes have a huge reach outside its own organization. The plant's economic impact on the Quad-City economy is about $750,000 to $1 million, he Riches says. "We also are the largest single-point user on MidAmerican Energy's whole grid."

Riches cannot say whether the A380 project will raise its economic impact, "but projects like the A380 help sustain the 2,100 jobs we have here. If this hadn't come along, maybe we'd be making more of some other plane. But clearly this is a significant project that's going to be supplied for a long time. It's the kind of project you like to see."

Jennifer DeWitt can be contacted at (563) 383-2318 or jdewitt@qctimes.com.