Alcoa’s Giant Press: When Labor, Government and Industry Work Together on Supply Assurance

When it comes to supply risk and supply assurance, we've focused much of our energies of late thinking through global supplier financial and operational viability. The logical extension of this discussion often comes down to the most effective ways of taking action in given situations (e.g., switching suppliers before a bankruptcy to avoid disruption, investing to develop a supplier, buying a supplier's facility as a last resort, etc.) But these discussions become moot when a supplier is truly a strategic one -- and clear alternatives do not exist. Such is the case with Alcoa and the US military in the case of a giant forging press. Over on Spend Matters affiliate blog MetalMiner, Lisa Reisman covers the story about how a unique combination of labor, Federal, state and private sector funding are coming together to bring this monster back online. According to Lisa's coverage a recent new labor agreement "served as a prerequisite for Alcoa to obtain funding from state and local governments necessary to aid in the repair of its 50,000 ton forging press called 'The 50.' The repair bill, a hefty $70m will go toward fixing a crack in the forging press foundation discovered last summer." The history of this press, which stands many stories tall (see the pictures on Lisa's post) is fascinating. One commenter even provided a link to a history of the press and how the US built it "in a sort of 'press race' with the Soviets back in the 50's."

Flash forward fifty years and Russia has traded out communism for fascism. But the need for such a giant still stands (I'm sure Russia has similar giant presses left over from the nuclear arms race as well). But in our case, we still need it to achieve the tolerances and stamping requirements for military applications like the joint strike fighter. In this case, Alcoa plans to use the press in part to provide "$360m of aluminum forgings... for large aluminum structural die forgings for 1200 aircraft and 15 large bulkheads." But more important for the rest of us, the state of this single giant press is a great reminder of the importance of thinking through supply assurance as an aspect of supply risk. There are certain suppliers -- and certain facilities at certain suppliers -- which demand eternal vigilance when it comes to developing and monitoring.

Jason Busch

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