The Global Automotive Aluminum Extrusion Market is expected to grow at a CAGR of around 9%, over the forecast period.
The automotive extruded aluminum market across the world will be driven by the trend for light-weighting vehicles to achieve set MPG figures and decrease the emission of greenhouse gases. The industry’s paradigm shift towards electric vehicles also offers a substantial opportunity in this market which will see aluminum extrusion companies build their portfolio accordingly. But looming trade wars between nations coupled with the tariffs imposed on importing metals and other products is expected to hamper the growth of this market. Also, development of other light-weight materials such as AHSS and carbon fiber might also offset the market growth.
The market is characterized by the presence of both regional and global players such as Bonnell Aluminum Extrusion Company, Kaiser Aluminum Corp, ABC Aluminum Solutions, Norsk Hydro ASA, Constellium NV and Novelis Inc. Small and fragmented players can introduce cheaper and sub-standard products into the market making it a highly competitive environment. But volatile metal prices might see some of the players exiting the market due to high cost of producing final parts.
Key Market Trends
Electric Vehicles to see increased usage of aluminum extruded parts over the forecast period
The electric vehicles market is expected to grow steadily over the coming years and the total electric vehicle sales is expected to have crossed the 2 million mark in the 2018. A significant increase in the number of ‘affordable’ EV models from 2020 is expected to drive the sales over the forecast period.
In general, EVs make use of aluminum and aluminum extrusions to improve fuel economy (in PHEVs), provide better range (in BEVs), safety, and overall driving aesthetics. Extrusions can commonly be found in space frames, doors, hoods, hang-on parts, trunk lids, bumpers, crash boxes, body in white, and car bodies, among other parts. The high thermal conductivity of an aluminum extrusion part deems it as an excellent option for removing heat from the vehicle. Alloy strength and extrusion profile also play a critical role when taking EV crash management into consideration. In electric vehicles, the battery is the equivalent of a gas tank. Hence, it is paramount for the sake of safety to prevent intrusion and protect an EV’s battery compartment in the event of side impact crash. Extruded aluminum offers high strength-to-weight ratio, design flexibility, and ductility needed to provide protection to the battery compartment.
Many manufacturers and aluminum extrusion parts supplying companies are coming up with new innovations and products in this field. For instance, Constellium NV has developed a novel cold-plate technology for efficient cooling of battery modules in EVs. The novel bent extrusion corner design is developed with no space wastage, no chips from drilling, and only a small degree of deformation. Tesla-designed Model S uses a four-inch-deep aluminum box running throughout the length of the car for the battery pack support, which, when joined with the aluminum body structure, becomes three times stronger.
United States poised to be a major market
The automotive aluminum extrusion market is expected to register a CAGR of more than 9% during the forecast period.
The regulatory frameworks imposed by the National Highway Traffic Safety Administration (NHTSA) and Environmental Protection Agency (EPA) in the United States have been instrumental in creating an evolving environment for the automobile industry. According to the latest framework, which was introduced in 2012, the automaker’s average fuel economy was expected to reach 35.5 mpg in 2016 and go up to 54.5 mpg in 2025. This presents a 90% increase in average fuel efficiency, in comparison to the 2011 model year average of 28.6 miles per gallon. This has driven the automobile manufacturers as well as OEMs to introduce lightweight materials in the offerings to bring down the weight and subsequently increase the mileage. Aluminum extruded parts are being used in latest vehicle models such as Ford F-150 and the Acura NSX. Electric car manufacturer Tesla has been using extruded parts in almost all its models. Also, Audi, BMW, and Daimler have plans to launch 50, 12, and 10 EV cars by 2025, 2025, and 2022, respectively, which further opens opportunities for aluminum extrusion companies in the United States to build their portfolio accordingly.
Base metal prices have been under pressure during the past few months in the United States, due to the looming trade war between the country and others, especially China. This volatile situation can push up the prices of aluminum thus hindering the market growth.
The automotive aluminum extruded parts market is neither a fragmented nor consolidated one. The market is characterized by the presence of considerably large players who have tie ups with major automotive manufacturers. Novelis Inc., Constellium NV, Norsk Hydro ASA, Kaiser Aluminum and Kobelco Aluminum Products & Extrusions Inc. are some of the major companies in this market.
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