New Uses, Lower Prices

The aluminum industry had accomplished what other industries said was impossible. With hourly wages up 75% over 1939, the price of primary aluminum had been reduced by 30% (from 20-c- to 14-c- a lb.). Last week, aluminum's two new members, who had given the industry the first competition in its history, made even more significant price reductions.

Henry J. Kaiser's Permanente Metals Corp., with the usual blare of trumpets that accompanies any move of the Kaiser enterprises, lowered the price of sheet aluminum to 21$ a lb., "approximately 15% below anything ever produced for sheet metal fabricators." The same day, the Reynolds Metals Co., whose president, Richard S. Reynolds, got into aluminum by making foil wrappers for his uncle's tobacco products, announced price reductions averaging 20% on aluminum building materials, such as shingles, clapboard siding, roofing and ceiling panels. Only the Aluminum Co. of America, which had the aluminum business to itself before the war, held on to its prices. Said one Alcoa man: "Alcoa never engages in price wars: we are pleased with the Reynolds and Kaiser announcements."

Alcoa had no reason to deplore the price cuts. In a sense, the three competitors are fighting the same fight. The aluminum industry emerged from the war with a capacity of more than 1 billion pounds a year--well over three times its prewar peak.

For most of the first two postwar years, aluminum, thanks largely to its availability when other materials were short, continued in high demand. But this spring, as fabricators' inventories were filled, demand slacked off. Today much of the industry is running at about 75% of capacity. To regain lost ground, aluminum must compete with the other materials in price as well as in utility.

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