Aluminium Unlimited

In Canada, where superlatives are especially prized because there are so few of them, the favorite word of Montreal's Aluminium Limited is "biggest." Aluminium* prides itself on having the world's biggest aluminum smelter, the biggest private hydroelectric project, and the biggest bauxite production. Last week, at its annual meeting, Aluminium announced the best superlative of them all: in 1962 it comfortably maintained its lead as the world's largest primary aluminum producer. As sales rose 8% to a record $515 million, and profits jumped 24% to $34 million. Aluminium poured 790,000 tons of aluminum around the world v. 700,000 by the U.S.'s Alcoa, its fiercest competitor.

Though all this greatly pleases Canadians, who are happy to see the Yanks second best in something. Aluminium is not so much a Canadian company as a truly international one. Its founders came from Pittsburgh, its plants span 30 countries from Japan to Africa, and 85% of its sales are made in more than 100 foreign nations. Says President Nathanael Vining Davis, 47, a Harvard-educated ('38) U.S. citizen: "Canada can use only 15% of our output. We have to sell the rest of it to the world."

Low Costs. Aluminium was created largely by Davis' imaginative uncle, the late Arthur Vining Davis, longtime chief of the Aluminum Company of America. Partly to satisfy U.S. trustbusters, Alcoa in 1928 tied its foreign branches into a single package and spun them off as Aluminium. Since 1951, when a federal court ordered Alcoa to sell off the last of its stock holdings, Alcoa's prime interest in Aluminium has been to block it from winning more of the U.S. market, which is Aluminium's No.1 customer.

Aluminium comfortably skims tariff barriers because it is a low-cost producer, benefiting from Canada's lower-wage labor, devalued dollar and abundance of cheap electric power. Harnessing the remote Saguenay River, Aluminium cut into the trackless wilds of northern Quebec to build the dams that now power the smelter at Arvida (a contraction of Arthur Vining Davis). For the still bigger Kitimat power project in British Columbia, it carved a ten-mile tunnel into a mountain, created a waterfall 16 times as high as Niagara Falls and built a smelter with an awesome annual capacity of 300,000 tons.

New Process. Aluminium uses its selling power deftly abroad, lest it court higher tariffs. Instead of pushing aggressively, its smoothly multilingual salesmen overseas seek to sell ingots to local fabricators--which are often Aluminium subsidiaries with local shareholders, directors and managers. "We can't run our foreign operating companies from Montreal," says President Davis, who jets around the world two or three times a year to help stitch together the loose empire.

Knowing that it must export to survive, Aluminium is now experimenting with a radically new process that could make it even more competitive. Scheduled to start producing next year at Arvida is a new .plant designed to produce aluminum directly from bauxite, without first converting it into saltlike alumina. If successful, that process alone would cut production costs by 25%.

*Which adds a British second i to its name, and thereby comes out al-you-m/H-ee-um.

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