Commitment is largest single project investment in Kentucky in a year
Governor Steve Beshear today announced Aleris Corp. plans to invest $350 million to expand its capabilities at its Lewisport rolling mill in Hancock County.
Aleris commitment to the Commonwealth is the largest single project investment by a company in Kentucky in more than a year.
I want to thank Aleris for reaffirming its commitment to Kentucky and our local families, said Gov. Beshear. This investment is a testament to our strong workforce and pro-business attitude. Thanks to companies like Aleris, Kentucky is a driving force in the aluminum industry.
The project will equip the company with the capabilities and the technology to serve the North American automotive industry as it shifts to broader aluminum use to make lighter vehicles.
The investment positions the company for long-term growth while maintaining steady employment for approximately 800 workers. Construction will begin this fall, with a goal of shipping automotive body sheet to customers by early 2017.
Aleris has been a provider of state-of-the-art lightweight aluminum solutions to the European auto industry for a number of years, and we expect our Lewisport investment will allow us to extend those capabilities to our automotive customers in North America to help them meet more stringent fuel efficiency standards, said Steve Demetriou, Aleris chairman and CEO. We believe the shift toward greater aluminum use in automotive manufacturing is one of the most significant opportunities in our industrys history, and we are excited to establish our Lewisport facility as a strategically important site in this evolution.
Tighter fuel efficiency requirements are causing auto manufacturers to expand their use of lightweight aluminum to include hoods, door panels and trunks. The use of aluminum sheet for vehicle bodies is projected to increase to 4 billion pounds in 2025, from 200 million pounds in 2012. The production of auto body sheet requires a highly specialized heat treatment process in order to meet the precise specifications of automotive manufacturers.
Aleris has expertise in this process at its Duffel, Belgium, facility where the company is a leading supplier to the European premium car industry. The companys investment in Lewisport includes two continuous annealing lines and a new wide cold mill.
The company has operated its 1.6 million-square-foot mill in Hancock County since 1964. Aleris chose to expand in Kentucky due to the Commonwealths strategic location and business-friendly environment.
Kentuckys aluminum presence continues to grow. Last year, the industry created more than $2 billion in state gross domestic product. More than 20,000 Kentucky jobs are attributed to the industry.
To encourage the investment in Lewisport, the Kentucky Economic Development Finance Authority (KEDFA) preliminarily approved Aleris for tax incentives up to $11 million through the Kentucky Reinvestment Act (KRA). KRA is designed to assist companies that need to make significant capital investment in Kentucky facilities in order to remain competitive.
KEDFA also approved the company for tax benefits up to $750,000 through the Kentucky Enterprise Initiative Act, which allows approved companies to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development and electronic processing equipment.
Aleris is a privately held, global leader in aluminum rolled products and extrusions, aluminum recycling and specification alloy production. The company serves a number of diverse industries including aerospace, automotive, defense, building and construction, industrial, rail and trucking. Headquartered in Cleveland, Ohio, Aleris operates more than 40 production facilities in North America, Europe and Asia. For more information, visit www.aleris.com.