Alcoa Corporation, a prominent American aluminum manufacturer, has announced its plan to permanently shut down the Kwinana aluminum plant located in Western Australia. This decision follows a reduction in the plant’s production scheduled for June 2024. The closure is attributed to several factors, including the aging infrastructure, rising operational costs, market conditions, and challenges associated with the bauxite ore essential for the facility’s operations.
Despite the plant’s closure, Alcoa will continue to operate its port and railway lines in Kwinana, as well as its other strategically important assets in both Western Australia and Victoria.
In connection with the plant’s shut down, Alcoa is set to incur restructuring costs and associated fees totaling $623 million after tax deductions, amounting to approximately $2.41 per share in the third quarter of 2025. These expenses include about $375 million in losses related to non-cash asset write-downs.
Additionally, the company anticipates an increase in provisions for asset decommissioning and environmental obligations, expected to reach $260 million in 2025, with projections of around $300 million in 2026.
Currently, the Kwinana plant employs approximately 220 individuals. The workforce will be gradually reduced throughout 2026, although some employees will remain post-closure for site redevelopment efforts. Costs related to employee layoffs are anticipated to be recorded in the first quarter of 2024.
The shutdown will lead to an annual production capacity reduction of around 2.2 million tons for Alcoa, bringing its total output to approximately 11.7 million tons annually, down from around 13.9 million tons.