By John W. Miller
Aluminum makers, already benefiting from increased use of
aluminum by auto makers, stand to gain further from growth in the
electric car industry, Phil Martens, the chief executive of Novelis
Inc., and a former Ford Motor Co. executive, said in an
interview.
Novelis, a unit of Hindalco Industries Ltd., has invested over
$550 million since 2011 to increase auto sheet production capacity
in upstate New York, Germany and China, to produce more aluminum
for cars. The company is now looking at further expanding
production in the U.S. "I wish we had 100,000 tons more capacity,"
Mr. Martens said. "We're clearly looking at what to do next."
Electric cars are still a fledging, niche industry--and one that
already uses aluminum. Tesla Motors Inc. makes its Model S sedan
and forthcoming Model X sport utility out of aluminum, and has
forecast substantial growth globally for its vehicles.
"You're going to have a whole new infrastructure with
lightweight structures," said Mr. Martens, mentioning plans by
Google Inc. to build a self-driving cars and unconfirmed media
reports that Apple Inc. is working on an electric car. "And we
expect it will be very aluminum intensive."
Several other longer-range electric cars set to debut over the
next several years could take advantage of aluminum's lightweight
characteristics, although many question whether these cars can
attract a mass audience, based on sales so far.
Already, mainstream car makers, led by Ford with the F-150, are
ramping up their use of aluminum as they try to meet new government
fuel efficiency standards by making cars lighter; 18% of all
vehicles in the U.S. will have all-aluminum bodies by 2025,
compared with less than 1% now, according to Ducker Worldwide, a
consulting and market research firm.
Aluminum is still more expensive than steel, limiting its use so
far in developing world markets. Weight and fuel savings make up
for the few hundred additional dollars it costs to make a car out
of aluminum, Mr. Martens said. "That's why this is a global company
with a global manufacturing strategy," he said. "Our China facility
will be sold out."
One area where Novelis is trying to do more research is in
developing new bonding and adhesive technologies, said the CEO.
Novelis last month reported a net profit of $46 million in the
third quarter of the 2015 fiscal year, up from $13 million in the
same period in 2014. Revenue increased 18% to $2.85 billion from
$2.4 billion, thanks to a 5% increase in shipments of rolled
aluminum products to 757,000 tons from 721,000 tons.
Mike Ramsey contributed to this article
Write to John W. Miller at john.miller@wsj.com
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