Sometimes you just have to go to the source. I think Alcoa’s press release yesterday says all you need to know about the state of the economy. Some highlights:
- Smelting output reduced 18%
- Cutting 13,500 workers, or 13% of workforce
- Selling non-core businesses
- Cutting capital expenditures in half
“These are extraordinary times, requiring speed and decisiveness to address the current economic downturn, and flexibility and foresight to be prepared for future uncertainties in our markets,” said Klaus Kleinfeld, President and CEO of Alcoa Inc. “We are taking a wide-ranging set of aggressive, but prudent, measures to ensure that Alcoa maintains its competitive lead in today’s challenging markets while also emerging even stronger when the economy recovers.”
“Because we recently completed an extensive competitive analysis, including a strategic review of each business, we have been able to quickly identify and implement effective responses that strengthen our market competitiveness and financial staying power in the economic downturn. We will continue to monitor the dynamic market situation to ensure that we adjust capacity to meet any future changes in demand and seize new opportunities that emerge. These are extraordinary times requiring extraordinary actions,” said Mr. Kleinfeld.
Extraordinary, indeed. It ain’t every day you hear a CEO talk about the need for “financial staying power.”
It feels really good to have stopped out of our long oil position yesterday. As goes the economy, so goes oil demand, and you see what Alcoa expects from the economy.
