At a time when the state-of-the-art in aerostructures design more and more often involves the use of carbon-fiber laminates, companies like Alcoa Aerospace suddenly face a perception challenge unrivaled since aluminum became the material of choice in airplane construction. So the timing of Alcoa Aerospace’s first industry forum, held in New York City on May 2, came as little surprise. After all, perhaps the world’s most striking example of composite technology would roll out of Boeing’s Everett, Washington assembly complex in just a few months’ time. A reminder that, in terms of dollar value, Alcoa’s contribution to the 787 nearly equals its content in the aluminum-bodied 767 seemed certainly in order, if for no one but the investment community.
Although in terms of pure weight content Alcoa’s share of the 767 dwarfs the company’s presence in the 787, the many metal-to-composite joints in the Dreamliner require a highly specialized and much more expensive set of fasteners, for example. “We don’t manufacture the high-volume nuts and bolts you buy at your local hardware store,” said Olivier Jarrault, president of Alcoa Aerospace’s Fastening Systems division (AFS). “These are only specialized systems made under very tightly controlled tolerances with high-performance materials.”
Formed through the acquisition of Huck Fasteners in 2000 and Fairchild Fasteners in 2002, AFS operates 15 aerospace manufacturing plants and four distribution centers in North America, Europe and Asia. New plants in Acuna, Mexico; Nemasvamos, Hungary; and Suzhou, China, account for 340,000 sq ft of increased capacity, and the company plans to expand its workforce in those locations by 12 percent by 2009. AFS now accounts for some 25 percent of Alcoa Aerospace’s sales, and more than 30 percent of AFS’s revenue comes from proprietary products.
Elsewhere within its aerospace business, Alcoa just last month finished adding sheet and plate capacity at its Global Rolled Products division mills in Davenport, Iowa; Kitts Green, UK; Fusina, Italy; and Belaya Kalitva, Russia. Announced in June 2005, the additions account for a 50-percent capacity expansion. Meanwhile, expansion of Alcoa’s Power and Propulsion Systems’ manufacturing capabilities recently resulted in a new airfoil post-cast operation in Szekesfehervar, Hungary, an expansion of airfoil post-cast operations in Acuna, Mexico, expansion of turbine airfoil casting capacity in Whitehall, Michigan, and more turbine airfoil core capacity in Morristown, Tennessee.
Next, the company plans to bring on line five more single-crystal casting furnaces within its Power and Propulsion unit over the next two quarters. The most complex of the three major processes used to cast metal, the single-crystal technique completely eliminates boundaries in the atomic arrangement of grains that form the crystalline structure of metal, resulting in a finished product with enough strength and heat tolerance for use in turbofan engine blades and vanes. The process also allows its Howmet Castings division in Whitehall, Michigan, acquired by Alcoa in 2004, to make hollow castings thinner and lighter, for example, and engine builders to design their cores to run hotter and, therefore, more efficiently. Howmet ranks as the industry’s most prolific user of the technique “by a two to one advantage,” according Alcoa Power and Propulsion division president Raymond Mitchell.
A380 a Showcase for Alcoa Alloys
As the largest supplier to the Airbus A380 program, Alcoa expects to put to good use all the new capacity it has created as production rates of the superjumbo begin to accelerate, while programs such as the Lockheed JSF and various very light jets find their stride.
Alcoa Aerospace president of North American Rolled Products Mick Wallis referred to the A380 as a “showcase” for Alcoa proprietary alloys, several of which appear in the fuselage alone. The company supplies forgings, extrusions, sheet, plate and castings for the A380’s wing and fuselage skins, along with stringers, frames, spars, gear ribs, engine and pylon supports, seat tracks and floor beams.
Meanwhile, the AFS division has developed multi-material lock bolts for the assembly of the big jet’s wing box and new-generation blind bolts tailored for the program’s new robotic assembly techniques. Each A380 uses about one million Alcoa fasteners.
Although the super-large airliner is not expected to yield a particularly high volume of unit sales (Alcoa cited a projection for 200 deliveries between 2007 and 2015), the A380 consumes nine times the metal and alloys required by a single-aisle airplane such as a 737 or A320. Of course, it helps that the A380 uses the world’s largest sheet panels and largest wing skin plates–both manufactured by Alcoa.
Delivery Schedules on Track
Alcoa Engineered Products & Solutions group president William Christopher said the company remains “on track” in terms of meeting delivery schedules for the A380 and 787. However, the industry will certainly feel a capacity crunch once the new programs begin to create a serious pull on supply resources. “Generally, [the effect of the larger] size of the aircraft has yet to kick in,” said Christopher, who, while serving as the company’s lead cheerleader in New York, predicted the industry’s upturn could last through 2010 into 2011. Wallis projected an even more bullish outlook, professing, “I do not see the market weakening before the 2012-2013 time frame.”
“The cycle has more run in it than originally thought,” added Christopher, who explained that while emerging markets up until now have driven airline industry expansion, U.S. and European carriers “sat on the sidelines.” He predicted the big Western airlines will “need to come back in the game” after a period of delaying fleet replacements while in recovery from the 9/11 terrorist attacks and a general industry recession.
This time, however, the economic rationale for replacing equipment will lie more firmly with the cost savings of technology improvements than with favorable acquisition cost, said Christopher. The resulting demand from the OEMs for more sophisticated materials plays directly to Alcoa’s strengths, claims the company, whose quest for bigger profit margins has moved it away from commodity markets and more into proprietary technology. In 2004, proprietary products accounted for 12 percent of Alcoa’s aerospace revenue; this year the company expects that share to rise to 21 percent.
Alcoa now produces a proprietary aluminum-lithium alloy at two casting facilities that the company claims carry enough capacity to meet five years of present demand. It has pitched the material to Boeing, among others, as an alternative to titanium for components such as wing spars and nacelle pylons. “We’re talking about ten tons of high-value product on each of these aircraft that are still under discussion,” said Wallis.
Working on Titanium Alternatives
Prized for its light weight, anticorrosion properties and resistance to expansion at high temperatures, titanium now accounts for at least 15 percent of the 787’s weight. However, as rising demand from a variety of industries and relatively few sources of supply conspire to drive prices ever higher, airframers have begun to reassess the wisdom of relying on the metal to the extent that they do.
“We’re working on a number of different alternatives right now,” said Christopher.
“Some of those are to replace titanium with some aluminum content. Given the event that [the airplane] is highly composite, we’re also developing other alternative solutions that will meet composite performance with more metallic-based material.
“Part of the big issue around titanium is the fact that there’s been a significant increase in price…787 demand is stressing, will stress the supply capability for their material. When you look at that translating into single-aisle production, you almost get to a point where you say we’re not sure how the industry will solve that because when you bring on these [airplanes], it’s not going to come on over time, it will be
a step-change,” he explained. “So Mick [Wallis] and his team are taking weight out, starting to replace titanium parts with aluminum-lithium, things of that nature. We’re working that on the 787 and we believe anything we do there will be extendable to the single-aisle, where we’re also continuing work on advanced metallics and other hybrid solutions.”
Boeing, meanwhile, continues to raise alarm about a coming crunch in traditional aluminum plate capacity, although Alcoa insists its plant investments in recent years will prove enough to maintain supply. “There are still possibilities [to expand further] even without touching money,” insisted Global Rolled Products group president Helmut Wieser. “Up until now the supply has been very tight, but we’ll support our customers.”
Christopher added that Alcoa is the only supplier to have invested “significantly” during the recent expansion. He also acknowledged that supply remained tight, however, and not necessarily by accident. “It’s always in [Boeing’s and Airbus’] best interest to have an oversupply situation,” said Christopher. “And as we look at all the dynamics we’ve been pretty prudent about how we look at investment in terms of where we see the cycle, how it’s going to pay off and the commitments we have to our customer base. If there continues to be a shortfall, then the risk is it limits builds to some extent, but I don’t think aluminum plate will be the only thing that potentially could limit build, and I’m not so sure that’s a bad thing.”