NEW YORK, Dec 18 (Reuters) - Aluminum giant Alcoa Inc. said Wednesday it reached a temporary agreement with the New York Power Authority to help avoid a shutdown of its Massena East smelter, although it will slash 110 jobs in 2003 at the plant as part of a restructuring plan.
Alcoa said a $7 million temporary economic incentive with the NYPA will significantly reduce operating costs at the East Plant, located about 260 miles north of Albany near the Canadian border, in 2003 as it streamlines output, reduces costs and seeks to improve profitability.
Alcoa's Primary Metals unit also said the short-term deal just finalized with the NYPA recognized the current volatility of the aluminum market. "The arrangement will provide relief to the East Plant in 2003 and further long-term supply discussions early next year," Alcoa said.
The layoffs at Massena will affect both salaried employees and hourly workers represented by the United Steelworkers of America Local 450A.
Alcoa, based in Pittsburgh, is the world's largest aluminum and alumina producer.