AUTOMOTIVE ALUMINUM S INCREASING MARKET PERFORMANCE NORTH AMERICAN AUTOMOTIVE METALS CONFERENCE SEPTEMBER 2-3, 2015
PRESENTER: DOUG RICHMAN Doug Richman Technical Committee Chairman The Aluminum Association s Aluminum Transportation Group Vice President-Engineering/Technology Kaiser Aluminum
DISCUSSION OUTLINE Automotive Demand Drivers Supply/Demand 2015:25 Rolling Capacity Products Customers Want Questions
DRIVER DEMAND: 2015-2025 THE ALUMINUM ADVANTAGE
WHAT AUTOMOTIVE CUSTOMERS NEED ALUMINUM DEMAND DRIVERS 2015:25 Weight Reduction (Multi-Material Vehicles) - Fuel Economy/CO2 (CAFE) - Performance: Safety, 0-60, handling, ride, NVH, braking, etc. Payload, towing capacity Aluminum Products Body Sheet Extrusions Structural castings Properties Strong, tough, energy absorbing, corrosion resistant, formable, etc. Cost Effective
50 YEARS OF ALUMINUM GROWTH 600 DOORS & BODY-IN- WHITE 509 lbs. 500 Pounds Per Vehicle (PPV) 400 300 200 Heat Exchangers Wheels Heads Blocks Bumpers HOODS 394 lbs. Sheet Extrusions 100 0 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 Source: Ducker
ALUMINUM BODY COMPONENTS Body in White Deck Door outer Bumper Beams Shock Towers Fenders Door and other closure inners Door outer Hood
ALUMINUM AUTO BODY SHEET AND EXTRUSIONS 1.0 lb. of aluminum replaces 1.7 lbs. of MS/HS/AHSS Body: -40% mass (BIW, Closures) Curb mass: -12% Jaguar, F-150, Aachen, FEV/EDAG Secondary mass reductions Up to 0.5 lbs. 10% vehicle mass reduction achievable Cost advantage over other fuel economy technologies Diesel, hybrid, electric, 6.5% FE improvement (+ 2.7 MPG)
AUTOMOTIVE : THE ALUMINUM GROWTH MARKET 2014:2025 M&E 8% Cons, Durab. 7% 2014 2025 Other 3% Transport 36% M&E 5% Cons, Durab. 6% Other 3% Transport 48% Elect. 8% Elect. 9% B&C 9% B&C 13% Total: 24 B Lbs. Packag. 24% Packag. 21% Total: 27 B Lbs.
WILL THERE BE ENOUGH ALUMINUM? 2015-2025 SUPPLY AND DEMAND
NAFTA ALUMINUM CONSUMPTION - 2014 Aluminum Consumption Primary 10.0 B lbs. Recycled 10.5 B Imports 3.7 B Total: 24.2 B Lbs. Data Source: USGS Minerals Yearbook 2014
ALUMINUM PRODUCTION VALUE STREAM
GLOBAL ALUMINUM CAPACITY 2014 Mine (Bauxite) Global Bauxite Production Global Bauxite Reserves Refine (Alumina) Global Capacity Global Production Global Demand Increase 2025 570 B lbs. 140 T lbs. (250 years) 280 B Lbs. 220 B 20 B Note: 4 5 lbs. Bauxite, yields 2 lbs. Alumina, yields 1 lb. Aluminum Data Source: IAI Statistical Review - 2015
PRIMARY ALUMINUM CAPACITY 2014:25 Global Primary - 2015 Capacity 120 B lbs. Demand 105 B lbs. Available 15 B lbs. Global 2025 Demand + 10 B lbs. NAFTA Primary - 2014 Capacity 11.3 B Lbs. Demand 10.0 B Available 1.3 B NAFTA 2025 Demand + 2.0 B Lbs. Opportunity + 0.7 B Lbs. (NAFTA Capacity, Import?) NAFTA Capacity: US 5.1 B Lbs. CAN 6.2 B Data Source: USGS Minerals Yearbook 2014
CANADA PRIMARY ALUMINUM PRODUCITON 2015 Sources: Rio Tinto Alcan; Alcoa; Aluminerie Alouette
NAFTA PRIMARY ALUMINUM LONG TERM TREND CO2 Generation* Coal 20 lb./lb. Al Hydro 5 lb./lb. Al * Includes: mining, refining, transportation
COST EFFICIENCY IMPROVEMENT $2.00 $1.80 Aluminum Price 1975-2014 Market, CPI Adjusted (1975 = 1) $1.60 Aluminum ($.Lb.) $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 1975 Price CPI Indexed Average MW Price Changes 1975:15 CPI 4.4 AL 2.5 Bread 5.0 Labor 4.9 Car 4.7 Elect. 4.5 Home 4.1 Gasoline2.7 $0.20 $0.00 1975 1980 1985 1990 1995 2000 2005 2010
NAFTA ALUMINUM ROLLING CAPACITY 2015:25 (SHEET AND PLATE) Sheet / Plate: 2015 Total S&P Body Sheet * Demand 10.6 B Lbs. 1.1 B Lbs. Capacity: Domestic 11.3 B 1.5 B Lbs. Imports 1.3 B Total 12.6 B Lbs. 2025 Demand 13.1 B Lbs. 3.7 B Lbs. Opportunity + 0.5 B Lbs. + 2.1 B Lbs. * Unique: cold rolling, finishing, HT, coating
AUTOMOTIVE SHEET COMMITMENTS Company Operational Capacity (Lbs.) Accum. Novelis 2015 0.2 B 0.2 B Alcoa 2015 0.2 B 0.4 B Alcoa 2015 0.3 B 0.7 B Constellium 2016 0.2 B 0.9 B Aleris 2017 0.5 B 1.4 B Constellium 2018 0.2 B 1.6 B Kobe Steel TBD 0.3 B 1.9 B Alcoa (M. M.) TBD TBD TBD Source: Pacific Coast Research
CONTINUOUS IMPROVEMENTS
ADVANCED ALLOYS - TO MEET AUTOMOTIVE NEEDS Continuous Product Improvement High Strength Energy Absorption Advanced Formability Value Sustainability Graphic: Alcoa R&D
HIGH STRENGTH ALUMINUM GRADES High Strength Alloy/Temper Variants Applications body structure, bumper, frame rails Sheet: Variants: 6013,6022, 7021 UTS 250 400 Mpa Extrusions: Variants: 6061, 6082, 7003, 7046, 7050, 7075 UTS 250-400 MPa
ALUMINUM ENERGY ABSORPTION Crush Grade Alloy/Temper Variants Excellent energy absorption Aluminum: Highest energy absorption automotive material, pound for pound Applications body structure, bumper, frame rails, crash cans Sheet: Variants: 6022, 5454, 5754 UTS 250 400 MPa Extrusions: Sheet Crush grade ~ 250 MPa Extrusions Alcoa Variants: 6005, 6061, 6082, 7003, 7046 UTS 250 400 MPa Kaiser Crush grade 250-400 MPa
ENHANCED FORMABILITY ALUMINUM ALLOYS Formability Alloy/Temper Variants Excellent: deep draw, hydroforming, hemming Applications body structure, exterior panels, door inner Sheet (exterior): Variants: 6022, 6XXX,. UTS 250 365 MPa Sheet (structural) Variants: 6022, 6111, 6XXX, 5182, 5454 UTS 250 575 MPa Extrusions: Variants: 6061, 6082 UTS 300 350 MPa
CONTINUOUS IMPROVEMENT Stronger, Lighter, More Formable Safety/Strength Design Manufacturing Sustainabili ty Kaiser, SAPA 6xxx, 7xxx Series High-Strength (280Mpa) Constellium Crash Management Systems Constellium Surfalex HF Novelis Advanz e200 Multi-Material Joining Novelis Fusion, s200 26% reduction in energy use for primary since 1995 37% reduction in carbon footprint for primary since 1995 Alcoa VersaCast Alcoa EZCast Alcoa Micromill Closed-Loop Recycling Novelis Advanz 6xHS, 7xHS, s615
ENVIRONMENTAL STEWARDSHIP North American (U.S. Canada) Primary Aluminum Production: -26% -45%
BODY SHEET GAME CHANGER - ALCOA MICRO-MILL TECHNOLOGY Alcoa Micro Mill Technology: 30 percent greater strength 40 percent greater formability 6xxx alloy Class A surface quality 5xxx and 6xxx alloys components Alcoa MicroMill Simplified auto sheet flow-path 20 minute process time Small foot-print
FUTURE MULTI-MATERIAL VEHICLES Cadillac Jaguar Chevrolet 2016 Cadillac CT6 2016 Jaguar XF 2016 Chevrolet Malibu
QUESTIONS?