Auto standards favour aluminum
NEW YORK–Aluminum demand will get a lift as auto manufacturers design and build lighter passenger vehicles to comply with President Barack Obama’s plan to cut U.S. auto emissions, but the ramping up process will take several years.
"Looking at it from a long-term view, yes, this is definitely a positive for aluminum consumption. But it’s not going to happen overnight," said Gayle Berry, metals analyst at Barclays Capital in London.
Obama this week proposed the strictest plan ever to increase federal fuel standards for passenger cars and trucks. The rule, effective in 2012, would require the U.S. passenger vehicle fleet to average 35.5 miles per gallon by 2016, saving 1.8 billion barrels of oil.
Vehicles must be lighter to meet those goals. Analysts see aluminum as the biggest base metals beneficiary. Materials such as plastics, carbon fibre and light-weight steel will also see greater use. But many give aluminum the edge because of its light weight and characteristics such as strength, flexibility, anti-corrosiveness and recyclability no checking account payday advance.
"Pressure to be more fuel-efficient benefits aluminum versus other materials. We see the outlook for more fuel-efficient vehicles as clearly positive for aluminum," said Jorge Vazquez, vice president of aluminum intelligence at Harbor Intelligence in Texas.
For years, aluminum producers have worked closely with automakers to promote the metal, which now dominates applications like vehicle bumpers, wheels, seat holdings, and many others.
By 2009, aluminum reached an all-time high of 8.6 per cent of the average North American vehicle weight, said the Aluminum Association, which expects that content to grow to an average 11 per cent of car and light truck weight by 2020.