Boeing Selects Aluminum Suppliers

Boeing Commercial Airplane Group said today it has selected five mills to supply all of its aluminum products over the next 10 years.

With an estimated value of $4.3 billion, the agreements are part of the company's new "lean" procurement strategy. Boeing will buy aluminum for its airplanes directly from the mills and then provide it through a single distributor to external suppliers and internal parts shops.

The strategy is expected to allow Boeing to better forecast aluminum requirements to help keep a steady supply at a reasonable price.

As a result, significant cost savings are expected across the entire supply chain, said Russ Bunio, head of Boeing's materiel division. Boeing and more than 500 other aero-structure companies now deal with seven flat-rolled mills, 14 extrusion mills and more than 50 distributors.

Under the deal, Boeing said, starting late this year it will be contracting with: Alcoa (Aluminum Co. of America) of Pittsburgh; Century Aluminum of Monterey, Calif.; Hoogovens Aluminium Walzprodukte of Koblenz, Germany; Kaiser Aluminum of Houston; and Universal Alloys of Canton, Ga., and its owner, ALU Menziken Industrie, of Menziken, Switzerland.

Boeing previously announced it has signed a contract with distributor TMX, a subsidiary of Detroit-based Thyssen, owned by Thyssen of Dusseldorf, Germany.

Parts suppliers will join the network as current contracts expire, some as long as 30 months from now.

Polly Lane's phone message number is 206-464-2149. Her e-mail address is: plane@seattletimes.com