Alcoa signs largest-ever deal with Boeing

Reuters

Alcoa Inc. has signed a long-term contract to supply plane maker Boeing with aluminum sheet and plate that is worth more than $1 billion, the metals company said on Thursday.

The new contract is the largest ever signed between the two companies, said Alcoa, a longtime Boeing supplier. It did not disclose a precise value or time frame.

Alcoa has been expanding its aerospace business, and in June announced a $2.85 billion deal to buy jet engine part maker Firth Rixson.

Though it helped create the modern aluminum industry more than a century ago, Alcoa is eager to produce higher-margin, specialized parts for aerospace and automotive customers, even if they contain other metals or no aluminum at all.

Alcoa said the agreement announced on Thursday 'establishes a foundation for continued collaboration” on new alloys, including aluminum-lithium.

'This historic agreement not only continues the 35-year Alcoa-Boeing partnership, it will take our collaboration on next-generation metallic technologies even further,” said Klaus Kleinfeld, Alcoa chairman and chief executive officer.

The deal makes Alcoa the sole supplier of wing skins for Boeing airplanes that have a metallic structure. Alcoa plate products, such as wing ribs and skins, also will be on every Boeing platform, including the 787 Dreamliner.

The Alcoa plant in Davenport has supplied wing skins for Boeing's 747-8 and 777. as well as the Airbus A380, the world's largest passenger plane.

In addition to aluminum for the automotive industry, the Iowa plant produces advanced products for the automotive industry. Pittsburgh-based Alcoa completed a $300 million expansion of the Davenport rolling mill in January dedicated to supplying aluminum sheet products to the auto industry.

The expansion created 150 full-time jobs.