Kobe Steel to Expand Aluminium Sales for Automobile

Kobe Steel’s aluminium and copper unit tries to expand the output and sales for automobile and information technology industry. The firm expects the market grows for flat aluminium for automotive body and extrusion for bumper. Mr. Hiroyuki Nakayama, president of aluminium and copper unit and executive vice president of Kobe Steel expects the strong aluminium sales for automobile application. Mr. Nakayama expects the bumper sales increases to near monthly 50,000 units in October-March period from near 26,000 units in April-September and reaches near 60,000 units in 2008 and 80,000 units in 2009. He said the Chofu plant increases the output to monthly 3,950 tonnes in October-March 2007 from 3,500 tonnes in April-September. Mr. Nakayama expects the aluminium sales for automobile body increases when European regulation forces carmakers to reduce the automobile weight. He said the sales will exceed monthly 4,000 tonnes in 5 years from 1,400-1,500 tonnes now. Mr. Nakayama said the unit tries to expand the copper sheet and strip sales for automotive connector and semiconductor areas. He said the subsidiary, Suzhou Kobe Copper Technology, which started operation in 2006, increases the operation to monthly 200 tonnes despite of the slower starting up than expected. Mr. Nakayama said the unit is suffered from production loss cost due to higher metal price when the market price increases for zinc, manganese, magnesium and silicon along with aluminium and copper. He expects the cost will increase by around 500 million yen in October-March period. The firm tries to pass the part of the higher cost on the selling price while the firm tries to reduce the production cost.