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Lighweighting prompts heavy investment in aluminum

Number of visits: Date:9/20/2016 05:53:50
  The pressure for industry lightweighting is triggering aluminum-parts factory investment around the United States.   Last week, a joint venture between a Dutch company and a Japanese manufacturer officially opened its new factory in Bowling Green, Ky., to supply various automakers with an assortment of aluminum production parts.   The $150 million plant is a joint venture between Constellium NV of Amsterdam and UACJ Corp. of Tokyo -- both powerful players in the aluminum business but neither household names in the auto sector.   Although the venture sits near General Motors' Corvette assembly plant in Bowling Green, officials with the supplier declined to say who will receive its aluminum parts, which include a variety of aluminum coils, closure panels and body structures.   Constellium-UACJ CEO Simon Laddychuk told Automotive   News that the new plant is also convenient to other automakers in the region.   The venture already has "significant contracts with leading OEMs," he said.   The partners are part of a movement by aluminum producers to increase auto parts output in the U.S. to take advantage of vehicle lightweighting efforts. According to a Reuters report in July, UACJ bought SRS Industries, a Michigan-based aluminum supplier, for $155 million. In May, competitor Kobe Steel said it would invest about $47 million in a Kentucky plant to produce aluminum extrusions for vehicle bumpers and frames.   Automakers are turning to more aluminum parts to inch toward the federally mandated 2025 corporate average fuel economy target of 54.5 mpg. One of the most dramatic changes was Ford Motor Co.'s shift to an aluminum body on its redesigned 2015 F-150 pickup.   Constellium, UACJ and other aluminum suppliers expect to grow in North America from the increased demand. Laddychuk said the fuel economy regulations are driving the business opportunity.   "Even if we look at this conservatively, the market is going to double over the next five years," he said.   He said Constellium-UACJ's 225,000-square-foot plant will operate on a 24-hours-a-day, seven-days-a-week schedule, with about 65 employees.   The plant will rely on coiled aluminum delivered from mills in Kentucky and Alabama. Last year, Constellium invested $1.4 billion to acquire the Wise Metals aluminum mill in Muscle Shoals, Ala., to target automotive body-in-white opportunities. At the time, the Dutch company said it would invest another $750 million there by 2022 to expand aluminum output.   Constellium-UACJ also has opened an r&d center in the Detroit suburb of Plymouth, Mich.   "We want to make sure we're not compromising on design," Laddychuk said.   While demand for aluminum parts has risen in recent years, automakers still are studying their future solutions, said Michael Robinet, IHS Automotive managing director.   He said the aluminum industry continues to be conservative in expanding for future demand, predicting, "They are going to be very careful to add capacity only when required."
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