CCID Consulting: Aluminum for Automobile Body Requires Breakthroughs
in Alloy Performance and Application Technology

BEIJING–(BUSINESS WIRE)–As the demand for lightweight vehicles expands, aluminum has become the
best alternative material for automobile construction due to its good
mechanical property, processability, corrosion-resistance and
weldability. With a density only one third of that of steel, the
aluminum body of a passenger vehicle weighs 46% less than a traditional
steel one, which also improves safety and fuel efficiency.

Stable growth of demand in the automobile market lays a solid
foundation for aluminum application.

In 2011, the growth rate of China’s automobile sales volume shrank
dramatically to 2.45% only, partly due to the state’s suspension of auto
consumption incentive policies. However, the factors driving the growth
of China’s automobile market remained unchanged. The progress of
urbanization and the upgrade of the consumption structure will continue
to boost the automobile consumption. It is estimated that China’s
automobile market will keep a stable growth from 2012 to 2015, with a
compound annual growth rate of 8.1%. The sales volume is expected to
reach 25.287 million by 2015.

Forecast on China’s Auto Sales Volume and Growth Rate

http://event.ccidconsulting.com/en/images/en-0709-1.jpg

Source: China Association of Automobile Manufacturers & CCID Consulting

Specifically, aluminum sheets for automobile body will be the most
promising sector. Currently among all aluminum parts used in automobile
construction, including castings, forgings, section bars and sheets,
castings take up the biggest share. Aluminum has been used in automobile
body, mainly for engine cabin covers, doors and trunk lids, in Europe,
North America, Japan and South Korea, represented by Audi’s A8 and A2,
Chrysler’s Prowler and Jeep, Subaru’s Legacy and Hyundai’s Motors
Genesis. However, China has seen a slow growth of aluminum application
in automobile due to technical bottlenecks. Once technical breakthroughs
are achieved, massive application of aluminum sheets in automobile
construction can be expected. CCID Consulting estimates that the
passenger vehicle market will need at least 1.802 million tons of
aluminum sheets annually, assuming that aluminum replaces 15% of the
steel used in automobile manufacturing by 2015. Even if aluminum only
replaces 5% of the steel, the demand will still be as large as 601,000
tons.

The key is to improve aluminum sheets’ performance and make
breakthroughs in application technologies.

As a result of the technical bottlenecks concerning aluminum sheets’
performance and application, the domestic automobile manufacturers are
facing high costs of aluminum application and are reluctant to use
aluminum sheets. Meanwhile, as foreign-owned aluminum enterprises like
Novelis have geared up for the Chinese market, the domestic research
institutes, aluminum companies and automobile manufacturers will have to
unite and accelerate the R&D process to make technical breakthroughs in
the two aspects.

Aluminum alloys currently used in automobile body include Al-Cu-Mg (2000
series), Al-Mg (5000 series) and Al-Mg-Si (6000 series). The 5000-series
alloys boast low cost and good shaping property, but they will leave
traces of tensile strain after being shaped and need re-polishing with
abrasive materials. In response to this, aluminum materials suppliers
have developed the 6000-series alloys, which are preferred by automobile
manufacturers for their better performance in extension, stretching and
anti-pit ability. However, being thick and expensive, aluminum alloy
sheets currently found in the Chinese market still cannot meet the
requirements of the automobile manufacturers.

Regarding the application technologies, including preprocessing, thermal
treatment, shaping, soldering, spray finishing and baking, the key is to
have the aluminum companies and automobile manufacturers conduct R&D
cooperation and develop such techniques as spray finishing and selection
of paint colors. In addition, automobile manufacturers also need to
purchase required devices such as soldering devices if they decide to
use aluminum sheets.

About CCID Consulting Co., Ltd.

CCID Consulting Co., Ltd., the first Chinese consulting firm listed in
the Growth Enterprise Market (GEM) of the Stock Exchange of Hong Kong
(HKSE: 08235) and the first consulting firm which gets ISO 9001
international and national quality management system standard
certification, is directly affiliated to China Center for Information
Industry Development (hereinafter known as CCID Group). Headquartered in
Beijing, CCID Consulting has so far set up branch offices in Shanghai,
Guangzhou, Shenzhen, Xi’an, Wuhan and Nanjing with over 300 professional
consultants. The company’s business scope has covered over 200 large and
medium-sized cities in China. CCID Consulting provides customers with
public policy establishment, industry competitiveness upgrade,
development strategy and planning, marketing strategy and research, HR
management, IT programming and management services, investment and
financing, and M&A. The company’s customers range from government
departments at all levels and diversified industrial parks, to
industrial users in strategic emerging industries in new generation
information technology, energy saving and environmental protection,
biological science and technology, high-end equipment manufacturing, new
materials, and new energy. CCID Consulting commits itself to become the
No. 1 advisor for urban economy, the No.1 consultancy for enterprise
management, and the No. 1 brand for informatization consulting in China.