4281--2/15/2008--ALCOA

related topics

{cost, regulation, environmental}

{condition, economic, financial}

{operation, international, foreign}

{cost, operation, labor}

{acquisition, growth, future}

{cost, contract, operation}

{financial, litigation, operation}

Alcoa is subject to cyclical fluctuations in LME prices, economic conditions generally, and aluminum end-use markets. Alcoa s operations consume substantial amounts of energy; profitability may decline if energy costs rise or if energy supplies are interrupted. Alcoa s profitability could be adversely affected by increases in the cost of raw materials. Union disputes and other employee relations issues could adversely affect Alcoa s financial results. Alcoa may not be able to successfully implement its growth strategy. Alcoa s operations are exposed to business and operational risks, changes in conditions and events beyond its control in the countries in which it operates. Alcoa is exposed to fluctuations in foreign currency exchange rates and interest rates, as well as inflation and other economic factors in the countries in which it operates. The influence of China may negatively impact our results in the event of a slowdown in consumption. Alcoa faces significant price competition from other aluminum producers and end-use markets for certain Alcoa products that are highly competitive, such that customers may be willing to accept substitutes for products sold by Alcoa. Further metals industry consolidation could impact our business. Alcoa could be adversely affected by changes in the business or financial condition of a significant customer or customers. Alcoa may not be able to successfully implement its productivity and cost-reduction initiatives. Alcoa may not be able to successfully develop and implement new technology initiatives. Alcoa is subject to a broad range of environmental laws and regulations in the jurisdictions in which it operates and may be exposed to substantial costs and liabilities associated with such laws. Climate change, climate change regulations and greenhouse effects may adversely impact our operations and markets. Alcoa may be exposed to significant legal proceedings, investigations or changes in law. Alcoa could be required to make additional contributions to its defined benefit pension plans as a result of adverse changes in interest rates and the capital markets. Unexpected events may increase Alcoa s cost of doing business or disrupt Alcoa s operations.

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4281--2/15/2008--ALCOA_INC