NEW YORK Novelis Inc. will permanently cease rolling mill production at its Saguenay Works in Jonquiere, Quebec, this summer in a move intended to help "right-size" the aluminum producers North American capacity.
The facility, which produces hot-band aluminum coils for Novelis operations in Terre Haute, Ind., and Fairmont, W.Va., will close in August "following a transition period," the Atlanta-based company said Thursday.
Following the closure, Novelis will source hot-band coil from its other facilities, a company spokeswoman told AMM, declining to specify the plants overall capacity. The plant does not supply any third-party customers.
"Our priority in the months ahead is to maintain safe operations while we manage the smoothest transition for our work force, customers and suppliers at Saguenay," Tom Walpole, senior vice president at Novelis and president of Novelis North America, said in a statement.
The company said its decision to close the Saguenay Works facility was the result of a "comprehensive review" of its North American manufacturing operations. In particular, the Saguenay Works plant has been burdened by "ever-increasing logistics costs and structural challenges," the company said.
"While the long-term growth potential of Novelis remains strong, we must continue to optimize our footprint to more efficiently support our overall business objectives to drive profitable growth," president and chief executive officer Philip Martens said.
Novelis announcement that it would be closing its Saguenay Works rolling mill came just one day after it unveiled plans to build a 120,000-tonne-per-year aluminum automotive sheet manufacturing facility in Chinas Jiangsu province (AMM, April 12).
The two decisions were not related, the Novelis spokeswoman told AMM. "The decision to build a plant in China is due to the strong demand for aluminum automotive sheet we are seeing in China and across the globe," she said. "The decision in Saguenay addresses our need to optimize our manufacturing assets in North America."