In a piece for Bloomberg, Firat Kayakiran explores the recent fall in aluminum prices, and what this means for Hydro, a large producer of aluminum for cars and iPhones. As Hydro has to work out new ways to stay above water, like advanced forms of recycling, auto producers including BMW and Mercedes are very excited by the opportunity to start producing aluminum cars. As we have heard a lot about the new F-150, aluminum automobiles are beneficial for many reasons, especially the light weight which reduces emissions and increases fuel efficiency. Hydro’s aluminum would also allow these companies to produce side panels and other parts of the car in one piece, likely using the stamping technique. This is exciting for producers because it eliminates weak joining points which helps make cars even lighter and also increases the strength of the body of the car, eliminating areas that are vulnerable in the event of a crash.
With auto producers doing everything they can to meet emission standards and the looming CAFE requirement, I think that it is likely that most will begin to shift towards aluminum as a replacement for steal, especially if the prices remain low. If this trend continues, it could show just how much power and influence the auto industry has in other fields. Eventually, it seems like we will lose a major use of steal and many producer will be forced out of business, or forced to convert to aluminum production. With aluminum prices falling, this process may be accelerated and exaggerated.
Source:
http://www.bloomberg.com/news/2014-05-02/hydro-seeks-improved-margins-in-iphones-cars-amid-weak-aluminum.html
True, but aluminum prices will not be falling for long in if this trend continues. But you are correct, it will be interesting to see if any tier two suppliers switch over.
The battle between steel and aluminum goes back 2 decades (and probably longer) in terms of widespread use. Metallurgy continues to improve steel, too, so which material to use varies by mechanical need – weight vs strength – and by the challenge of joining aluminum to itself (welding doesn’t work) and dissimilar metals. So aluminum pistons in gasoline engines, steel pistons in diesel.
It does seem like the car industry is going to need to abandon steel to meet cafe, but I actually think that carbon fiber will be the replacement. Aluminum is a short term fix, but carbon fiber’s price continues to fall and it weighs close to nothing while being stronger than both metals.
The emission generated from the production of aluminum is neglected by the CAFE standard. If aluminum generates more emissions, auto companies’ efforts to use aluminum body are essentially useless for environmental protection. However, I am unsure that whether the production of aluminum generates more emissions than the production of steel or not.
Interesting query. Aluminum is refined through an electrolytic process, so was located in regions with cheap hydropower. But those locations were picked long ago, and I don’t know whether the opportunity cost of that “green” power is that other customers get electricity from coal. But in NAFTA, Al may be on the greener side of the generally dirty metals industries.