Alcoa to Borrow US$259 million Loan from DoE for Lightweight Automotive Materials

Published Date : Mar 26, 2015

Alcoa, a renowned Aluminum vendor, has landed a US$259 million loan assurance from the Department of Energy. These funds will come from the Advanced Technology Vehicle Manufacturing program of the federal government that was initiated in 2008 during the industry crisis. It is designed to assist the automakers and vendors with projects that could assist in reducing the fuel consumption, with US$25 billion in existing funds, although there have been a few loan permissions in recent years.

If the loan for Alcoa is finalized, the firm will utilize the money to assist in upgrading its Tennessee production facility to ramp up aluminum manufacturing. The extra output will assist in accommodating the rise in demand from North American auto-manufacturers.

The CEO of Alcoa, Mr. Klaus Kleinfeld, stated that Alcoa is happy to be a part of the government initiated program to promote a larger shift to aluminum intensive vehicles, which are lighter, safer, and more fuel-efficient. The novel F-150 is dominating the latest push toward aluminum in terms of the volume of the vehicle produced. Ford has decreased the probability of expanding the aluminum bodies beyond the F-series lineup; though the limited supplies of aluminum sheets of Alcoa were already answerable for delaying the early F-150 manufacturing.

In response to this, Mr. Jesse Prentice-Dunn, the Representative of the Beyond Oil Campaign of Sierra Club, released the statement saying that from Ford to Tesla, the auto manufacturers are growingly utilizing lighter and stronger materials to enhance vehicle fuel efficacy. They congratulate the Department of Energy for helping the auto manufacturers and vendors in their efforts to manufacture cleaner and more effective vehicles.

Alcoa requires the government loan to assist in creating an extra 200 permanent jobs.