Aluminum is lightweight, durable, corrosion-resistant and an ideal material for automotive bodies which increasingly demand greater fuel-efficiency and performance. Automotive aluminum is used in panels, anti-lock braking systems, wheels and chassis components to shed weight and extend operating range for electric and hybrid vehicles. With the rise of autonomous driving technologies, sophisticated sensor and control systems are driving demand for aluminum electronics housings that can withstand harsh road conditions while dissipating heat generated by powerful onboard computers and batteries. An expanding middle-class in emerging economies also fuels automotive sales and the use of high-quality aluminum panels and trim.
The global Automotive Aluminum Market is estimated to be valued at US$ 58.33 Billion in 2024 and is expected to exhibit a CAGR of 12.% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the major trends in the automotive aluminum market is the growing demand for lightweight vehicles. Strict fuel efficiency and emission standards have necessitated greater use of aluminum in vehicles. Aluminum is around 30% lighter than steel, and its increased use can reduce vehicle weight by 100-350 lbs. per vehicle. This directly improves fuel efficiency. Furthermore, lightweight vehicles have lower carbon dioxide emissions. Therefore, major automakers are focusing on mass reduction techniques and adopting aluminum alloys not just in exterior body panels but also interior, powertrain and chassis applications. The lightweighting trend will drive higher consumption of forged and rolled aluminum products in the coming years.
- Threat of new entrants: The automotive aluminum market requires high capital investments for setting up aluminum production facilities. Stringent regulations also acts as a barrier for new companies.
- Bargaining power of buyers: Buyers have moderate bargaining power as there are many established players providing aluminum materials. However, aluminum is important for automakers to reduce vehicle weight.
- Bargaining power of suppliers: Large automotive aluminum suppliers have significant influence over buyers due to their production scale and technological expertise. Suppliers can bargain on price and contracts.
- Threat of new substitutes: Aluminum faces competition from steel and composites as vehicle material. However, its high strength-to-weight ratio and corrosion resistance provide an advantage over substitutes.
- Competitive rivalry: The market has few global players controlling majority share. Intense competition exists regarding product innovation, pricing and long-term supply agreements.
The global automotive aluminum market is expected to witness high growth over the forecast period. The global Automotive Aluminum Market is estimated to be valued at US$ 58.33 Billion in 2024 and is expected to exhibit a CAGR of 12.% over the forecast period 2024 to 2031.
Asia Pacific currently dominates the market led by China, Japan and India. Stringent emission regulations are driving automakers to use lightweight materials like aluminum in the region. North America is another key market for automotive aluminum owing to presence of major automakers like GM and Ford. Presence of aerospace and defense industry is also fueling demand. The U.S. and Canada are major contributors.
Key players operating in the automotive aluminum market are Alcoa Inc., Arconic Inc., UACJ Corporation, CHALCO, AMG Advanced Metallurgical Group, Norsk Hydro ASA, Constellium N.V., Novelis Inc., and Rio. Players are focusing on R&D to develop new aluminum alloys for achieving greater fuel efficiency and performance enhancements. Consolidation activities are common in this industry.