INTERVIEW: The Alcoa turnaround

When Klaus Kleinfeld joined Alcoa Inc in 2007, he couldn’t have foreseen that the company would soon be plunged into one of the most unsettling periods the aluminum industry had ever seen.

The company posted record revenue of $30.7 billion for 2007, while income and cash from operations also were at all-time highs. But by the end of 2008 the world had been hit by the worst financial crisis since the 1930s depression, and the price of aluminium more than halved from about $3,200 per tonne in late summer 2008 to $1,100 in January 2009. “Every $100 [drop] meant $250 million less profits for us, so the bottom was falling out at record speed,” Kleinfeld said. “I have been blessed to have had the opportunity to do many turnarounds in my life, but never had I seen the balance sheet erode that fast.” Taking the necessary steps to curtail or close capacity was expensive and reduced Alcoa’s cash further. Fast-forward to 2015 and Alcoa has been dramatically revamped since Kleinfeld took over as ceo in May 2008, to the extent that it...


Andrea Hotter

January 12, 2015

17:19 GMT

New York