Global Automotive Aluminium Market Size and Share Outlook - Forecast Trends and Growth Analysis Report (2024-2032)

Automotive Aluminium Industry Overview

Aluminium is one of the most widely used metals in the manufacturing of vehicles due to its favourable properties and characteristics, including excellent strength and lightweight, among others. The safety, recyclability, and high efficiency of the metal make it ideal for use to enhance the safety and sustainability of different components of vehicles, such as wheels, suspensions, and brakes, among others. As per the Aluminum Association report for 2022, the average aluminium used in vehicles was around 459 pounds per vehicle in North America.

Increasing research activities aimed at developing high-performance aluminium alloys with enhanced ductility, strength, and corrosion resistance to improve vehicles’ performance are anticipated to aid the growth of the automotive aluminium market. In addition, technological advancements and innovations aimed at reducing the weight of luxury vehicles are likely to surge the usage of aluminium in the coming years.

Automotive Aluminium Market Growth

Aluminium is being increasingly used in vehicle manufacturing to reduce weight, which directly contributes to improved fuel efficiency and lower emissions. As governments and automakers prioritise sustainability and fuel efficiency, the demand for aluminium in the production of body panels, engine blocks, wheels, and other components is expanding.

Global environmental regulations, particularly in the European Union, North America, and Asia, are pushing automakers to reduce vehicle weight and carbon emissions. Aluminium’s ability to reduce vehicle weight while maintaining safety and structural integrity makes it a preferred choice for automakers seeking to meet these regulatory standards.

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Key Trends and Developments

Automotive Aluminium Market Trends

There is a growing trend towards reducing vehicle weight to enhance fuel efficiency and lower carbon emissions. Aluminium, being lighter than steel, is increasingly used in car bodies, chassis, wheels, and engine parts which boost automotive aluminium market development. Automakers are adopting aluminium to comply with stringent fuel economy and emissions regulations.

The rise of electric vehicles is a significant driver for the automotive aluminium market, as EVs require lighter components to offset the weight of heavy battery packs. Aluminium’s ability to reduce the overall weight of electric vehicles, thereby improving range and energy efficiency, has led to its growing use in EV production.

Automotive Aluminium Market Restraints

The high production cost of automotive aluminium compared to cost-effective materials can hinder market growth. This can be especially common among small-scale automakers who do not have the budget to afford high-grade aluminium for their vehicles, impacting the overall automotive aluminium demand forecast. As per the data from the International Aluminium Institute, aluminium production prices are greatly affected by energy prices, which can make them difficult to afford compared to raw materials such as steel and plastic. 

Moreover, the smelting process of aluminium requires a large amount of energy and the total energy for aluminium production can go up to 14-16 kWh of electricity per kilogram, which further adds to its high cost, and can pose a challenge to the market. 

Automotive Aluminium Market Dynamics

Several government bodies across the world are imposing strict regulations and standards regarding fuel emissions. The European Union announced that it has set a target for 2030 which aims to reduce the CO2 emissions from new cars by 37.5%. The usage of aluminium can be paramount for achieving this goal as it is a lightweight material and can reduce the overall weight of the vehicle, promoting fuel efficiency.

As per the automotive aluminium market dynamics and trends, several major market players are readily incorporating aluminium in their models to enhance fuel efficiency. For instance, the Ford F-150 model of Ford is now composed of an aluminum body which reduces around 700 pounds from its weight and improves its fuel efficiency by 25%. Moreover, many EVs and hybrid EVs are also using aluminium in their production as the use of aluminium can reduce their weight by around 50%, compared to steel.

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Automotive Aluminium Industry Segmentation

Automotive Aluminium Market Share

By Form Insights

As per the automotive aluminium industry analysis, Cast Aluminium holds the highest market share as it is widely used in the production of engine parts and transmission parts, among other critical components. Rolled aluminium is also gaining significant growth due to its growing usage in body panels and roofs as these parts require large flat surfaces. 

By Vehicle Insights

Passenger cars account for the highest market share due to the growing production of passenger cars in recent years. Several passenger car automakers are leveraging aluminium to meet fuel efficiency standards in regions such as Europe and the USA. Moreover, the high adoption of aluminium by leading passenger car providers such as Tesla and BMW for their body panels and chassis aids the segment growth and consequently growth of the automotive aluminium industry.

By Application Insights

Power trains account for a substantial market share as aluminium is extensively used to reduce their weight while improving efficiency and lowering manufacturing costs. With the growing trend of sustainability, manufacturers are using recycled aluminium in vehicle components, including power trains, to enhance the environmental performance of vehicles, which boosts the automotive aluminium market revenue.

Meanwhile, the utilisation of aluminium in chassis and suspension of vehicles is significantly growing owing to its favourable properties like high thermal conductivity, excellent corrosion resistance, and energy efficiency, among others.

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Automotive Aluminium Market Regional Insights

North America Automotive Aluminium Market Trends

North America represents a substantial portion of the automotive aluminium market share due to the increasing demand for luxury vehicles in countries like the United States. The continued preference of consumers for larger automobiles is contributing to the rise in aluminum production. In 2022, there were four times as many light trucks as cars, and they also contained almost 30% more aluminum.

The rising preference for eco-friendly, fuel-efficient, and sustainable vehicles in the region, especially among the environmentally conscious population, is also propelling the automotive aluminium market opportunities. According to the "2023 North American Light Vehicle Aluminum Content and Outlook" report, from 2020 to 2030, the market share of aluminum content will rise by approximately 100 net pounds per vehicle (PPV) due to the growing demand for more environmentally friendly modes of transportation.

Asia Pacific Automotive Aluminium Market Drivers

The Asia Pacific is expected to witness healthy growth in the forecast period due to rapid urbanisation and industrialisation and the increasing demand and production of vehicles. The introduction of stringent government initiatives aimed at lowering carbon emissions from vehicles is also likely to favour the automotive aluminium market development in the coming years.

ICRA states that the automobile industry has a major impact on India's consumption of aluminum and projects that the country's domestic aluminum demand would expand at a healthy rate of about 9% over the next two fiscal years. Moving forward, a greater amount of aluminum would be used per unit if the goal of improving fuel efficiency through vehicle weight reduction was to be pursued. In the long run, however, a substantial switch to electric cars throughout the next ten years would also support domestic aluminum demand.

Europe Automotive Aluminium Market Opportunities

The European region is expected to hold a significant share of the market due to the stringent CO2 emission standards for vehicles that are encouraging the adoption of lightweight materials such as aluminium. The EU aims to reduce the 37.5% for passenger car emissions by 37.5% and light commercial vehicle emissions by 31%, which can aid the automotive aluminium demand growth.

Latin America Automotive Aluminium Market Growth

Countries such as Brazil, Mexico, and Argentina are some of the major manufacturing hubs of the region, which can promote market growth. There is an increased focus on enhancing vehicle production in the region, specifically in Brazil and Mexico, which can increase automotive aluminium market opportunities in the coming years. 

Middle East and Africa Automotive Aluminium Market Dynamics

The MEA region is also expected to witness an upward trend in the market due to the presence of countries such as South Africa and Morocco which can offer major manufacturing hubs for automotive production. There has also been a surge in foreign investments in countries such as Morocco which allows automakers to invest in light-weight and efficient materials such as aluminium, which can boost the automotive aluminium industry revenue.

Competitive Landscape

The market players are heavily focused on innovations and establishing partnerships to supply aluminium parts to the automakers who are developing lightweight vehicles. Some players are also offering recycled aluminium as a part of the broader initiative of promoting sustainability.

Alcoa Corporation

Alcoa Corporation, founded in 1988, is one of the largest industrial companies in automotive aluminium industry. It is headquartered in Pittsburg, the United States, and is a major producer of aluminium in the world. Through research and development activities, the company aims to support sustainability in industrial activities.

Farinia Group

Farinia Group is a company that specialises in the production of innovative materials for use in manufacturing...

Endurance Technologies Limited

Endurance Technologies Limited is a leading aluminium die-casting company and one of the largest automotive co...

*Please note that this is only a partial list; the complete list of key players is available in the full report. Additionally, the list of key players can be customized to better suit your needs.*

Other automotive aluminium market players include Aluminum Corporation of China Limited, Consolidated Metco, Inc., Dynacast, Aluminium Bahrain B.S.C., Kaiser Aluminum Corporation, Gibbs Die Casting, Inc., Nemak Group, CITIC Limited, Bonnell Aluminum, Ryobi Group, Martinrea Honsel Germany GmbH, and Bodine Aluminum.

Innovative Automotive Aluminium Startups

Several startups in the company are focused on promoting sustainability and the usage of lightweight materials that can be achieved through aluminium. The companies are also investing in their production capacities and establishing collaborations with automakers to gain market reach. 

Gränges

This is one of the prominent startups in the market which focuses on automotive aluminium production. It has promoted the use of aluminium in critical automotive parts such as heat exchangers and battery enclosures that can aid the demand of automotive aluminium market. The company is also readily investing in expanding its production capacity to increase its market reach across the world, specifically in regions such as North America and Europe. 

BCAST

It is a UK-based startup from Brunel University which develops advanced casting and recycling technologies for aluminium in the automotive sector. The company is also working on sustainable aluminium casting methods that can improve the vehicle’s fuel efficiency and performance and has offered its high-strength aluminium to several automakers in recent years.