The shift of US automobile production from internal combustion engine vehicles to electric vehicles in the coming decade will alter the design and makeup of many automobile parts, and these changes will present a significant growth opportunity for the domestic aluminum extrusion market, according to an executive with global aluminum producer Norsk Hydro.
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"When you look at battery electric vehicles, there are certain types of components that you find that you don't find in an internal combustion engine vehicle, and they tend to be very extrusion heavy," Hydro's Duncan Pitchford said in an interview on the sidelines of the S&P Global Commodity Insights Aluminum Symposium. Pitchford is the head of product supply and joint venture offtake for Hydro's aluminum metals division.
"As you look at the rate of battery electric vehicle production in North America taking off almost exponentially over the next five to seven years, there will be a related growth in demand for those [extrusion-intensive] components," he added.
Pitchford said battery packs and protective battery enclosures in vehicles are two types of EV-specific components that will be produced using aluminum extrusions. Other legacy components, such as crash management systems, will also continue to prioritize aluminum for its lightweighting benefits as automakers look to decrease the overall weight of EVs to offset the added weight of the battery packs, he added.
"In our extrusion division and our aluminum metals division, where we have a lot of proprietary alloys that we've developed over the years, we look at growth for extrusion ingot (billet) sales, and that goes where the extrusion market is growing in automotive," Pitchford said.
Norway-based Hydro is currently constructing a 120,000 mt/year aluminum extrusion production facility in Cassopolis, Michigan, that could begin operations by the end of this year and will prioritize the use of recycled content. Its production will supply the automotive, transportation and building systems markets.
Pitchford said the Cassopolis project is Hydro's first greenfield manufacturing facility across its global operations in about 15 years and represents what the company sees as "a strong future for aluminum production in the US."
Hydro's aluminum metals division also operates recycling and casting facilities in Henderson, Kentucky, and Commerce, Texas. In addition, the company has an extensive extrusion division in North America.
'Green' aluminum demand
In the S&P Global interview, Pitchford said consumer interest in lower-carbon, or "green," aluminum products continues to increase as various industries attempt to decarbonize their value chains, and this trend has been mostly unaffected by weaker economic conditions that have surfaced since 2022.
"Over time, the trend is going to be toward greener products overall, and the end consumer is going to demand that," he said. "Europe is probably a few years ahead of the US on some aspects of this, but we see the US coming along very quickly now."
Pitchford noted that beyond industrial initiatives, the general public is increasingly aware of environmental stewardship, and this has guided buying decisions in favor of products made with sustainable materials.
Among its low-carbon portfolio, Hydro offers its CIRCAL brand of aluminum products, made with a raw material mix utilizing at least 75% post-consumer scrap. In the US, Hydro is able to produce CIRCAL at its Commerce plant, and it will soon offer the low-carbon brand from its Henderson and Cassopolis plants.
Interest in low-carbon aluminum products has increased in many sectors such as beverage packaging, but the automotive sector has been a notable leader, Pitchford said.
Pitchford added that Hydro's green-branded products are being sold globally at a premium.
"When we talk to customers that are interested in these types of products, they understand that product is going to come with a premium associated with it," he said. "What we see as any sort of near-term softness in the overall market, we don't see that same softness in these growth areas of automotive demand and green products."
Extrusion content in autos
Cast aluminum products have traditionally represented the bulk of aluminum content in automobiles, followed by sheet, extrusions and forgings.
In 2022, the average vehicle contained about 299 lb of cast aluminum and only 56 lb of aluminum extrusions, Abey Abraham, a principal with industry consulting firm Ducker Carlisle, said during a presentation at the Aluminum Symposium.
By 2030, as EVs increase in market share, Abraham said extrusion content will climb to an average of about 89 lb per vehicle while cast products will see a more modest increase to 304 lb. Extrusion content will grow as traditional powertrain, transmission and driveline components disappear from EVs and new components are added, such as gearboxes, electrical equipment and housings, he added.
Full battery EVs are projected to comprise about 31% of North American light vehicle production in 2030, up from only about 6% in 2022, Abraham said.