Aluminum suppliers expand as demand soars
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The auto industry's weight watchers should have a field day with the redesigned Range Rover to be displayed this month at the Paris auto show.
The vehicle's all-aluminum body is 926 pounds lighter than its predecessor, and Land Rover brags that the vehicle is the world's first all-aluminum SUV.
Jaguar Land Rover also plans to introduce the production-ready aluminum Jaguar F-Type in Paris.
Not a bad calling card for Novelis Inc., which supplies the aluminum for both vehicles and is among the aluminum suppliers expanding to meet the industry's rising demand.
So far, the auto industry's aluminum pioneers have been the European luxury brands. In May, for instance, Mercedes-Benz introduced an aluminum-bodied SL with a 560-pound body-in-white, 300 pounds lighter than its predecessor.
Novelis supplies aluminum for the SL convertible, and it produces aluminum sheet for nine other Mercedes models.
Novelis, the world's largest producer of aluminum sheet, expects mass-market automakers will follow the European luxury brands' example.
The automakers have little choice, now that Europe and the United States have adopted tougher fuel economy standards, says Roland Harings, Novelis vice president of global automotive.
"We will see a globalization of these [fuel economy] targets," Harings said. "The benefits of lightweight [materials] cannot be limited to low-volume luxury cars."
To meet expected demand, the Atlanta supplier is quintupling North American production of automotive sheet aluminum.
Novelis is adding 200,000 tons of aluminum sheet capacity at its plant in Oswego, N.Y., which produces about 50,000 tons.
Growing demand for aluminum "is a general trend," Harings said. "Lightweight materials are part of the agenda to reduce fuel consumption. Aluminum is the next logical step."
Last year, Novelis said it would spend $200 million to expand its Oswego plant. Similarly, rival Alcoa Inc. is spending $300 million to expand its plant in Davenport, Iowa.
Both companies are rushing to meet demand from automakers that are switching to aluminum body panels, decklids, hoods and doors.
You can reach David Sedgwick at dsedgwick@crain.com.
