Rio Tinto Alcan presents a recovery plan to boost the competitiveness of its French operations

Rio Tinto Alcan is considering reorganising its French operating structure and adopting additional cost-reduction measures for its aluminium and specialty alumina operations in light of its challenged cost structure. The proposed changes could involve a reduction of 350 roles at seven French sites. Rio Tinto Alcan plans to begin implementing a voluntary departure programme.

“There is a shortfall in financial results for specialty alumina and primary aluminium production, as these were strongly impacted by the drop in prices and decline in demand,” said Jean-Philippe Puig, president, Primary Metal – Europe, Middle East and Africa, Rio Tinto Alcan, during an information meeting held with the central labour management committee (le comité central d’entreprise). “Given the exceptionally high global inventory levels, we do not foresee a substantial improvement in the short term.”

Puig also said that Rio Tinto Alcan’s operations in France are particularly disadvantaged by a structural deterioration in their competitiveness. This affects all sites, especially the Saint-Jean-de-Maurienne facility. “If we want to come out of the economic crisis stronger and protect our long-term operations, we have to seriously rethink how we organise work at all of our sites as well as for our support functions,” he added.

Rio Tinto Alcan enacted cost reduction measures at the start of the economic crisis, but these have proven insufficient. Implementation of the new plan is essential to reposition each site’s production costs against the global average and, in doing so, contributing to their long-term competitiveness.

Research and development programmes aimed at aluminium production technology leadership, including the Saint-Jean-de-Maurienne technology testing and demonstration platform, will be maintained. Rio Tinto Alcan is also actively deploying its strategy to secure a long-term energy supply for its French primary aluminium production sites.

The financial information on which the proposed measures are based was submitted today to the central labour management committees (Comités centraux d’entreprise). A procedure for informing and consulting employee and management partners will be deployed during the coming weeks. Social support measures will also be covered.
Rio Tinto Alcan has stressed its commitment to taking all possible measures to keep the economic and social impact of the plan to the minimum achievable, in close collaboration with the public authorities.

The impacted sites are Dunkerque, Paris, Saint-Jean-de-Maurienne and Voreppe (aluminium), and Beyrède, Gardanne and La Bâthie (specialty alumina).
Building on more than a century of experience and expertise, Rio Tinto Alcan is the global leader in the aluminium industry. A Rio Tinto product group, it supplies high-quality
bauxite, alumina and aluminium worldwide. Its AP smelting technology is the industry benchmark.

About Rio Tinto

Rio Tinto is a leading international mining group headquartered in the UK, combining Rio Tinto plc, a London and NYSE listed company, and Rio Tinto Limited, which is listed on the Australian Securities Exchange.

Rio Tinto's business is finding, mining, and processing mineral resources. Major products are aluminium, copper, diamonds, energy (coal and uranium), gold, industrial minerals (borax, titanium dioxide, salt, talc) and iron ore. Activities span the world but are strongly represented in Australia and North America with significant businesses in South America, Asia, Europe and southern Africa.

For further information, please contact:

Media Relations, Rio Tinto Alcan
Stefano Bertolli
Tel.: +1 514 848 8151
stefano.bertolli@riotinto.com

Media Relations, Rio Tinto Alcan, France
Chrystele Ivins
Tel. : +33 1 57 00 24 18
chrystele.ivins@riotinto.com

13-10-2009 Rio Tinto Alcan French recovery plan press release [PDF: 23 KB]