Novelis: Aluminum sales to automakers will nearly triple on new emissions, mpg rules

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MUMBAI (Bloomberg) -- Novelis Inc., the world's biggest supplier of aluminum sheets to carmakers, expects sales to customers including Audi AG and Ford Motor Co. to rise almost three-fold as new emissions rules restrict the use of steel.

Shipments of automotive aluminum may climb to as much as 25 percent of total sales by 2020 from the current 9 percent of 3 million metric tons, Novelis Vice Chairman Debnarayan Bhattacharya said today in an interview in Mumbai.

The share of beverage cans, which are less profitable, will fall to 50 percent from about 60 percent.

"The overall pie is growing and still the share of automotive sales will jump," said Bhattacharya, who is also the managing director of Novelis parent Hindalco Industries Ltd. "We've started supplying to Ford for their F-150."

The F-150 pickup is Ford's most popular model in North America.

Hindalco, owned by billionaire Kumar Mangalam Birla, is betting regulations to cut carbon emissions and improve fuel efficiency in the U.S. and Europe will prompt carmakers to use more aluminum.

Ford dealers last month started taking orders for the new aluminum-bodied F-series, while Jaguar Land Rover Ltd. is building a mid-size sports sedan on an aluminum platform that will go on sale next year.

Lighter parts

Rules in Europe will require automobile producers to switch to lighter car parts and frames, according to the EU's website.

The regulations will cut average carbon-dioxide emissions from new vans sold in the EU by 14 percent.

Global aluminum-sheet use in automotive bodies will climb five-fold to 1.8 million tons by 2020 as manufacturers seek lightweight material to improve fuel economy, Derek Prichett, a vice president of global recycling at Atlanta-based Novelis, said on June 10.

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