North American Al sheet market set for growth–Alcoa’s Meggers
November 7, 2012
By:  Andrea Hotter

The North American auto sheet market is set for huge growth over the next few years as regulations and consumer purchasing patterns shift, Alcoa’s head of global rolled products said.

These factors are significantly accelerating the use of aluminium in the automotive industry, Kay Meggers told an investor briefing in New York on Wednesday November 7.

“We expect global auto-body sheet consumption of aluminium to rise by 7.5 times by 2025,” he said.

This will see the amount of aluminium in a vehicle rise from 343 lbs currently to around 550 lbs.

The company is adding capacity to support auto sheet market growth, such as the $300 million expansion at Davenport and the company’s Ma’aden joint venture in Saudi Arabia, which will have a low-cost rolling mill producing sheet and foil. 

The North American auto-sheet market is set for a compound annual growth rate increase of between 30% and 35% from this year to 2015, Meggers said.

Environmental concerns are changing regulations, which will result in a doubling of the US corporate average fuel economy rate in miles per gallon between 2011 and 2025, according to Meggers.

A 31% rise in the fuel economy rate will be seen in the USA between 2011 and 2016, he noted.

At the same time, 37% of US car consumers now say that fuel economy is the main factor in their automotive buying decisions, with 83% of all car buyers willing to pay more for fuel efficiency, Meggers noted.

Automotives contributed 8% to Alcoa’s global rolled products revenue in 2012, making it currently the smallest industry sector contributing to the division.

The largest was packaging at 43%, followed by industrial uses at 36%, and aerospace at 13%.