Steel and aluminium are engaged in an increasingly fierce competition to protect and raise their application in the transport sector, which is growing at the fastest rate in the manufacturing sector. Globally, 28 per cent of primary aluminium production of 58 million tonnes (mt) is used by the transport sector, including manufacture of automobiles and passenger and fighter aircraft. Similarly, the automobile industry has traditionally accounted for a good portion of flat steel consumption. Some varieties of long steel products such as bright bar and special bar also find wide application in auto components making.
Leading constituents of aluminium and steel industries continue to invest heavily in research and development (R&D), both independently and jointly with automobile groups for weight reduction in the case of steel and new alloys development for aluminium. ArcelorMittal chairman Lakshmi Mittal claims steel can provide all the weight reduction that automakers must achieve to conform to increasingly stringent fuel efficiency norms. For steel, the essential requirements are to offer a 25 per cent reduction in the weight of body-in-white of automobiles. Mittal claims "steel can already do this" in a more cost-effective and environment-friendly manner than any other material.
The world steel industry has the burden of low capacity use of about 65 per cent, thanks mainly to the reported 300 mt surplus capacity in China. Therefore, compulsion to protect every segment of the market is so critical that the steel industry must remain in pursuit of offering innovative high-strength, low weight metal to facilitate making of auto components that will be lighter and thinner. The lighter a car is, the lower will be its fuel consumption and carbon emissions. It is precisely on weight consideration and government glare on pollution that automobile makers in the US have continued to step up the use of aluminium every year over four decades. According to a survey of North American automakers by Ducker Worldwide, aluminium's share of the average automotive materials mix is likely to double to 16 per cent by 2025. The share of silvery white metal in auto application may, however, well exceed the projection if the success of Ford Motor in turning one of its best selling models in America F-150 pickups into an all-aluminium body encourages others to follow suit.
Seeing steel's success in achieving weight reduction and strength improvement going hand-in-hand, aluminium industry leader Alcoa of the US is perfecting a new way of sheet-making for the automobile industry. The company has discovered money is to be made by developing new alloys and not in commodity aluminium; so, it is investing heavily in new plants based on R&D results. Its newest alloy 'Micromill,' which allows "easy and quick intricate formability" is replacing steel components in F-150 pickups. Alcoa is readying a system that will allow casting of molten aluminium on to a conveyor belt for flattening into coils for use by the auto industry. The system dispenses with one major step in traditional production process of first turning raw materials into slabs before rolling. As a result, metal producers will have greater control of alloy chemistry besides significant energy and water saving. Hindalco-owned Novelis, the world leader in aluminium rolling and recycling, commissioned a breakthrough automotive heat treatment line in Germany's Nachterstedt in November following its automotive related major expansions in North America and Asia. The company claims "Novelis remains the only manufacturer of automotive aluminium sheet in the three major auto-producing regions in the world."
Whether it is a steelmaker or an aluminium producer, the big investment consideration is identical - offer the automobile industry an improved version of the metal that is to lower vehicle emissions. In most of their pursuits to make better alloys, aluminium groups have got automakers as partners. Novelis works with Britain's largest auto group, Jaguar Land Rover, and Alcoa is in partnership with Ford to make next-generation automotive aluminium alloys, which are design friendly and have greater degrees of formability. New alloys to be rolled out by Alcoa are supposed to be "30 per cent stronger and 40 per cent more formable' than mass produced aluminium. The use of new auto steel or aluminium alloys will raise the cost of vehicles. But, over the lifetime of vehicles, users will save on fuel cost and that will more than compensate for higher acquisition price in the first place. Now competition for both steel and aluminium is slowly but surely emerging from new material carbon-fibre composites.
Source: Business Standard