Novelis says China plant to boost sales

An aluminum sheet processing plant in Zouping county, Shandong province. Global demand for aluminum sheets for vehicles is forecast to record a compound annual growth rate of 30 percent by the end of 2020. [Provided to China Daily]

Novelis Inc, the world's largest supplier of light-weight aluminum automotive sheets, said on Tuesday that its new plant in Changzhou, Jiangsu province, would help cater the growing global demand for the fuel-efficient light metal.

The US-based company has invested $100 million on the plant that will produce 120,000 metric tons of light-weight aluminum every year. It will also help the company expand its global footprint to meet the rapidly growing market demand for automotive aluminum as automakers seek to reduce the overall weight of vehicles to enhance fuel efficiency.

Each 10 percent weight reduction can lead to fuel savings of 5 to 7 percent, said Steve Fisher, senior vice-president and chief financial officer of Novelis.

The company expects global demand for aluminum sheets for vehicles, which can be used in lightweight vehicle structures and body panels such as hoods, doors, fenders and lift gates, will record a compound annual growth rate of 30 percent by the end of 2020.

Global use of light-weight aluminum automotive sheets may reach 1.58 million metric tons by 2025.

Shashi Maudgal, president of Novelis Asia, said that in Asia alone, the use of aluminum in auto bodies by major car-making countries is around 50,000 metric tons.

Phil Martens, president and CEO of Novelis, said: "Global automakers seeking to drive fuel efficiency, higher performance and innovative design can now source locally produced Novelis aluminum automotive sheets in every major region where they make vehicles."

Fisher said Novelis has a global market share of more than 50 percent in light-weight aluminum automotive sheets, and the plant in Changzhou will help the aluminum maker solidify its leading position in the industry.

Liu Qing, managing director of Novelis China, said that he believes the company would have a market share of over 50 percent in China also.

Novelis aluminum products are used in more than 180 models of vehicles globally, including some operating in China, and the Changzhou plant will serve domestic demand including the car-making hubs in the Yangtze River Delta, said Liu.

Novelis is planning to triple its automotive sheet capacity to 900,000 metric tons by 2015, and has invested more than $550 million since 2011 to meet the goal.