Friday, Apr. 30, 1965
First Team at Alcoa
The softly carpeted executive suites of the Aluminum Co. of America have been governed since 1957 by a close-knit fraternity of men who grew up in the shadow of the late Arthur Vining Davis, for half a century the domineering chief of the world's largest aluminum company. In those eight years, in a series of frequent but gradual transitions, Alcoa's chairmen have three times passed on their duties as chief executive shortly before retirement. Last week, nearing 65, Chairman Lawrence Litchfield Jr. relinquished his duties as chief executive officer, a position he has held for only three years, to President John Dickson Harper, 55, Alcoa's first boss of the post-Davis era. Said Litchfield: "It's time to get the next first team lined up."
Instant Catnaps. Like the rest of Alcoa's recent top management, Harper has never worked for another company. Born in Louisville, Tenn., he found a $12-a-week summer job at the company's nearby plant in Alcoa, Tenn., while a high school student of 15, alternated three-month stints of work and study to graduate as an electrical engineer from the University of Tennessee. For the next 18 years, Harper moved slowly up through the ranks; then his strong performance as works manager of an aluminum smelter at Rockdale, Texas, propelled him to Alcoa's Pittsburgh headquarters in 1955. Eight years later, he was elected president, a job that ROW pays him $155,000 a year. An incessant telephone salesman who keeps his desk clean of paperwork, Harper spends nearly half his time on flying trips seeking new customers to expand the market for aluminum--a product to which he is so dedicated that he even uses an aluminum shotgun on the skeet range. To stretch his considerable energies, he has mastered the knack of demi-catnaps, often astounds associates by picking up the thread of a conversation when they think he has dozed off.
Even more than other big aluminum makers, Alcoa needs new customers. Confronted since 1957 by industry overexpansion, sagging prices for ingots and cutthroat competition in the less profitable fabricating field, it has lost part of its share of the market to new companies, has also been through a profit wringer. From a peak of $89.6 million in 1956, Alcoa's net income slid to $40 million in 1960. It has not yet fully recovered, though last year's earnings of $60.8 million (on a record $1 billion in sales) were the best since 1957, and first-quarter sales and profits this year showed further gains.
Stable Prices. These troubles have won Alcoa a reputation on Wall Street as a weak performer, but Harper insists that the company's fortunes should continue to brighten. Reason: aluminum demand is catching up with supply, and ingot prices have finally stabilized (at 24 1/2-c- a lb.), even though the industry has two more producers and 35% more capacity than when its price troubles began. Aluminum is already a big item in everything from saucepans to Saturn rocket skins, but to advance Alcoa's recovery further Harper is pushing hard to get more aluminum into mass products--tops for baby-food jars, pop-top cans, frozen food packages, auto-engine blocks and radiator grilles. With help from his researchers, he even hopes to challenge steel in such realms as quick-assembly bridge systems and rails for industrial cranes.
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