Alcoa contradicts Joe Hockey on reasons for smelter shutdown.         

Date
    February 19, 2014


Aluminium manufacturer Alcoa has contradicted federal government claims that the carbon tax led to the decision to shut the company's Point Henry smelter and two rolling mills in Geelong and western Sydney.   

Treasurer Joe Hockey and Mr Macfarlane both blamed the tax for the loss of nearly 1000 jobs.   

But in a statement a company spokeswoman confirmed ''the carbon tax was not a factor in the decision''.    


Prime Minister Tony Abbott and Industry Minister Ian Macfarlane were due to fly to Melbourne on Wednesday to meet Victorian Premier Denis Napthine after the latest manufacturing job losses.

Mr Napthine has previously flagged a wish-list of infrastructure projects he wanted fast-tracked. The meeting was confirmed late on Tuesday after doubts that an initial standoff between the offices of the prime minister and the premier.

The federal government is finalising its review of manufacturing in Victoria and South Australia, prompted by Holden's decision in December to quit manufacturing.

Mr Hockey had said Alcoa's decision was ''disappointing'', but ''predictable'' and linked it to the carbon price introduced by Labor, which he said added to the high cost of production. He called on Labor to back the repeal of the tax.    

''The carbon tax adds to the cost of production. It does, no matter what people say. You cannot say the carbon tax helps with producing things in Australia,'' he said.

''At the end of the day, the carbon tax is a greater cost on business. It is a massive cost on aluminium smelters, obviously. A 50-year-old smelter with a carbon tax is never going to be cost-effective.''

Alcoa had been exempt from 94.5 per cent of its carbon tax liability for its smelting operations as a so-called emissions intensive trade-exposed industry.

The decision to shut the Point Henry plant came after the company placed the plant under strategic review in February 2012, ahead of the introduction of the carbon price on July 1, 2012.

Announcing the review in 2012, Alcoa's managing director, Alan Cransberg, said the carbon tax would increase pressure on the company's operations at Point Henry, but said the review had not been prompted by the tax.

The Point Henry operation was subsequently thrown a $40 million lifeline in June 2012 by the former federal Labor and Victorian governments, but the cash injection had not been enough to help keep the company operating.

Opposition Leader Bill Shorten called on the Abbott government to roll out an assistance package for Alcoa workers.

Mr Shorten, who has been calling on the federal government to unveil a plan for Australian jobs, said the closure was devastating news for workers in Yennora and particularly Geelong, which had already been hit hard by Ford's decision last year to quit making cars.

''It's clear that a global oversupply of aluminium, dramatically falling aluminium prices and a high Australian dollar made the continuation of these operations impossible,'' he said. 

Read more: http://www.smh.com.au/federal-politics/political-news/alcoa-contradicts-joe-hockey-on-reasons-for-smelter-shutdown-20140218-32yir.html#ixzz2thoqam38

Hockey claims unions and workers were responsible for Toyota ending car manufacturing. Toyota refutes this.
Hockey claims the carbon tax was responsible for Alcoa closing some plants. Alcoa refutes this.

Anyone else see a pattern here?

Kat wrote on Feb 19^th, 2014 at 6:33am:
Hockey, Pyne and Abbott will distort and spin and tell any lie that suites them.  For some reason I don't think people understand how devastating this is to their ability to participate in the so called democracy of this country.    

Sorry....  but Aluminium...

Quote:


The Carbon Tax, and the other measures Labor has implemented which has caused the cost of electricity to rise...  has had an effect.  I heard somewhere that the smelter uses almost a 3rd of Victoria's power.  A bit far fetched but we do have these comments on it.

Quote:

Aluminium world prices are only a third of what they were a few years back. That alone is the reason for the closure.

Grendel wrote on Feb 19^th, 2014 at 9:46am:


what you think is irrelevant ... if the CEO says it wasn't a factor, then it wasn't a factor ... why do you struggle with that?

Alcoa was exempt from the carbon tax, ergo it was not the reason.

Maybe we should offer to set up a Westinghouse nuclear reactor for them—cheap power. But that isn’t the reason.

The world is basically in recession with even China slowing down. We are about to join the world by applying the discredited austerity measures and chasing away the car makers.