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Novelis' Kentucky aluminum recycling plant to be pivotal for auto demand: executive

Highlights

Auto-focused aluminum demand seen rising through 2030

Greater use of scrap supports sustainability goals

Novelis' recently announced plan to construct an aluminum recycling and sheet ingot plant in Kentucky represents a critical step to meet growing demand for lower carbon aluminum in the automotive industry, Executive Vice President Tom Boney told S&P Global Platts.

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"As demand continues to grow and we want to meet that challenge, we find ourselves in a position of wanting to grow this [capacity]," Boney said in an interview Jan. 11. "This will be the first such casting facility in North America that is dedicated to automotive sheet production."

Referencing a study conducted by DuckerFrontier, Boney said demand for aluminum in the automotive industry has expanded over the last four decades and will continue to rise through at least 2030.

The study projects that North American light vehicle aluminum content will reach 570 lb by 2030, up from 459 lb in 2020 and only 84 lb in 1975.

"We're being successful in chipping away at aluminum being a greater share of the weight on vehicles," Boney said. "As we see with many of the vehicles that we're successful with today and looking at the changes that are required for battery electric vehicles... we're continuously looking at those, but we feel very good about the market demand continuing to grow on a variety of different applications."

The automotive industry has also increasingly prioritized the sourcing of more sustainable metals and other materials to meet carbon reduction goals and match consumer preference.

"[Automotive customers] are putting pressure on us to be more and more aware of what's going on with regard to our environment and are looking for more information on CO2 content and other waste streams," Boney said. "This [Kentucky facility] will have a positive impact on our customers who buy material from this new casting facility because it reduces the carbon requirement."

The Atlanta-based aluminum roller expects the recycling facility to produce 240,000 mt/year of sheet ingot by 2024 using industrial scrap from its automotive customers and post-consumer scrap from used vehicles. Ingot from the facility will be supplied to Novelis' rolling mills in Oswego, New York, or Russellville, Kentucky, to be processed into automotive sheet.

Boney added that the greater use of scrap content at the plant aligns with Novelis' goal of reducing its carbon footprint and becoming carbon neutral by 2050.