Manufacturing News

Alcoa boss comments on high Australian cost, complacency

Comments by Alan Cransberg, chairman and managing director of Alcoa of Australia, has lent comments to the ongoing debate on the country’s competitiveness and said that Australia’s industry had become "fat, lazy and happy".

According to The West Australian, Cransberg addressed a corporate breakfast and said that the cost of doing business in Australia in Australia was a major concern.

“I think we've become fat, lazy and happy about the fact that we're good at digging holes," The West Australian reports him as saying.

“As people go into Africa, as China explores more, as Russia opens up different territories, some of those raw material markets for us that we've taken for granted may not be there.”

His comments come in a month in which the federal opposition released its plan to reduce regulation, the Business Council of Australia announced that it would be releasing a plan targeted at the nation’s prosperity, and research by an investment group found that Australia’s unit labour costs had gone from 85 per cent of the USA’s in 2000 to 241 per cent.

Alcoa’s Victorian smelters are currently under review, and the Port Henry and Portland sites are among the country’s most expensive.

"In WA – and Victoria – we've done a lot of work to take costs out of our business because with the commodity prices we have continually got to be at the lower end of the cost curve . . . and I'm really proud of our workforce here,” said Cransberg.

“But it's actually tougher than the global financial crisis at the moment. If you remember during the GFC, for us our commodity prices came down, but the currency came down. Now, although it has recovered somewhat, we have both."

Image: Herald Sun

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