Nearly half of China's aluminum production capacity is unprofitable, state-run China Daily quoted the chief executive officer of Alcoa Inc. Klaus Kleinfeld saying in a report Wednesday.
Some "41% of China's aluminum smelting capacity is unprofitable due to low aluminum prices and high production cost," said Mr. Kleinfeld, also chairman of the world's third largest aluminum producer by output.
"The Chinese government is taking steps to try to curb overcapacity, but it is not easy to decommission large, complex facilities," he said.
Mr. Kleinfeld said Alcoa is "open to exploring opportunities abroad with Chinese partners." The company has a partnership with state-owned power producer China Power Investment Corp. to produce high-end fabricated aluminum products for the aerospace, automotive, commercial transportation, consumer electronics and packaging markets in China, he said.
Alcoa announced additional production cuts most recently in May, blaming "a weak aluminum price environment." The company will be dropped from the Dow Jones Industrial Average next week due to its "low stock price," S&P Dow Jones Indices LLC, the company that oversees the Dow, said in a statement Tuesday.
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