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TECHNOLOGY
Responding to energy markets and opportunities
presented by economically competitive investment environments
are only two components of Alcan's approach to industry
shifts. The global aluminum industry is highly competitive
and producers worldwide, including Alcan, are constantly
seeking ways to reduce operational costs to boost competitiveness.
In real terms, the industry has witnessed a continued
long-term decline in the price of aluminum over more
than 30 years. Traditional "learning curve"
effects and concerted cost reduction have kept our industry
competitive during this period. The industry has managed
to survive the last three decades of declining real
prices for aluminum through investment in new technology
and cost control.
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| Bumper systems made from
aluminum extrusions by Alcan reduce the
weight of automobiles and contribute to increased
passenger safety. |
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This ongoing evolution has provided a key competitive opportunity
for Alcan in terms of technology development to respond to
such industry needs. The acquisition of Pechiney in December
2003, resulted in the combination of Pechiney's aluminum smelting
technology with Alcan's low cost smelter operating know-how
and management excellence. This put Alcan Inc. at the
cutting edge of aluminum smelter technology solutions and
positioned the Company as the supplier of choice to the industry
with state-of-the-art smelting technology products. In addition
to the licensing of technology, Alcan also provides smelting
services, equipment sales and engineering, and support services.
In fact, Alcan's technological and engineering solutions account
for more than 80% of smelting capacity installed since 1990
in the western world.
For example, the Primary Metal Group has reaffirmed its commitment
to maintain technological leadership in research and development
with two research laboratories – the Arvida Research
and Development Centre (ARDC) in Quebec, and the Laboratoire
de recherche de fabrication (LRF) in France. Some 200 people
work at ARDC and 110 are employed at LRF. The goals of the
research teams are to work in close collaboration and synergy
to:
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Support value maximization through rapid improvement
of current assets; |
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Consolidate and develop the group's smelting technology; |
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Provide scientific leadership leading to step change
and create powerful competitive advantage in the longer term. |
While technology is a critical element in any discussion
of the industry's future, Alcan also recognizes that the industry
appears to be reaching limits to cost reductions available
through incremental advances in core technology. These advances
can and will still be made, especially with the use of state-of-the-art
technologies. But, realistically, it is unlikely that a major
step forward in technology-driven efficiency will occur without
an equally major breakthrough in the traditional Hall-Héroult
aluminum smelting process that has been in existence for some
100 years.
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