Final Lap for Novelis’ $5bn Alabama Aluminum Plant

Novelis is nearing completion of its Bay Minette, Alabama, aluminum recycling and rolling plant, four years after breaking ground on what has become a $5 billion investment.

The project, which broke ground in 2022, has doubled from its original $2.5 billion price tag, with the company attributing the cost escalation to factors including materials and labour.

As the build winds down, EPCM contractor Fluor has begun demobilising. The Texas-based firm laid off 66 workers on site effective July 31, according to a WARN notice filed with Alabama’s Department of Workforce. 

A Fluor spokesperson called it routine project close-out, saying the firm is “reducing our footprint consistent with our staffing demobilisation plan” and that the cuts are “a normal part of the life cycle of large-scale EPCM projects.”

The site’s workforce had swelled to around 1,000 during 2025, when crews were installing the plant’s hot mill housings and pouring equipment foundations. That phase has since given way to commissioning, with Novelis starting up the cold mill in March and targeting full production in the second half of 2026.

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Once running, Bay Minette will be the first fully integrated aluminum recycling and rolling plant built in the US in more than 40 years, with capacity for 600,000 tonnes a year: 420,000 tonnes earmarked for beverage cans and 180,000 tonnes for automotive sheet.

CEO Steve Fisher has framed the plant as increasingly central to Novelis’ US strategy, telling investors on parent company Hindalco’s earnings call that domestic beverage-packaging capacity is running short and that “with the tariff situation, this project becomes even more strategic.”

Bay Minette is the biggest driver behind a sharp rise in Novelis’ capital spending, which climbed 39% to $2.3 billion in fiscal 2026. Combined with $925 million in fire-related losses at its Oswego, New York, plant, last year, that pushed adjusted free cash flow to a $2.4 billion outflow, with net leverage at 4.1 times adjusted EBITDA. 

Novelis expects to swing back to positive free cash flow by the end of fiscal 2027, once Bay Minette is fully operational and Oswego repairs wrap up.

The project’s ballooning cost is a reminder of how much mega-project budgets can shift between groundbreaking and ribbon-cutting, even for a company with Novelis’ scale and experience.

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