Alcoa Inc. said, on Thursday, it will spend about $300 million to expand its Davenport, Iowa rolled products plant in order to meet rising demand from the automotive market.
The Pittsburgh-based aluminum producer said in a press release that the project will add 150 new permanent jobs in Davenport once the expansion is complete, which is expected by the end of 2013.
Total employment will reach more than 2,300 jobs with the added aluminum production.
Another 150 workers will be hired for the construction project.
Aluminum as a percentage of autos has been increasing over the last 20 years, especially as the U.S. auto industry tries to meet more stringent fuel efficiency standards by using the light-weight metal.
For 2012 model cars, Alcoa said, the use of aluminum has reached an all-time high of 343 pounds per vehicle, a five percent increase since 2009, the last time automakers use of the shiny metal was studied.
"The automotive market has long lead times and much of this expansion we are announcing today is for business already secured. However, we see huge opportunity beyond this," said Helmut Wieser, Alcoa Executive Vice President and Group President of Alcoa Global Rolled Products.
The Iowa Department of Economic Development offered Alcoa an economic development package as incentive to select its city for the expansion project.
The incentive package includes tax, financing and research and development credits, as well as training grants for the Davenport workforce and new employees, the global aluminum giant said.
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