Automotive Aluminum Extrusion Market - Growth, Trends, and Forecasts (2022 - 2027)

The automotive aluminum extrusion market was valued at USD 32.05 billion in 2021, and it is expected to reach USD 64.11 billion by 2027, registering a CAGR of around 10.55% during the forecast period.

Manufacturing shutdowns, lockdowns, and trade restrictions during the COVID-19 pandemic negatively affected the automotive aluminum extrusion industry. Furthermore, the loss in metal production due to decreased demand and lack of labor significantly impacted the market.

As the automotive industry has gained its momentum post COVID-19 pandemic, the market is likely to recover during the forecast period. Furthermore, manufacturers are implementing contingency plans to manage future business uncertainties to retain continuity with clients in critical sectors of the automobile industry.

Due to increased spending on R&D operations by major industry players, the automotive and transportation sector is witnessing a surge in aluminum parts in internal combustion and electric cars globally.

Car manufacturers must comply with laws governing the environmental effect of their products. Several organizations, including the EPA, California Air Resource Board, and NHTSA, have passed laws and regulations concerning greenhouse gas emissions.

Several novel features of aluminum extruded parts, such as reducing the car's overall weight by employing aluminum components, are likely to attract more automakers. This will increase demand and boost sales in the industry.

Key Market Trends

Increase in demand of Lightweight Materials

The automotive industry is witnessing an increase in lightweight material developments, such as aluminum, which enable the body to produce lighter vehicles. The other influencing factors for lightweight materials technology are customer-driven requirements, like styling, aesthetic appearance, reduced NVH (noise, vibration, harshness), and comfort.

Also, mass-optimized design technology is being used to reduce the weight of vehicles. Integrated vehicle system design, new manufacturing processes, secondary mass effects, etc., have helped to achieve nearly 30% weight reduction in high strength steel intensive bodies and almost 40% weight reduction in aluminum-intensive vehicle bodies, such as Jaguar XJ, Audi A8, etc.

Regulatory authorities are emphasizing fuel efficiency. As they are imposing laws to reduce carbon emission and materials costs through consistent R&D, the market for body-in-white is expected to grow during the forecast period.

Though aluminum has been in use for a long time, innovations for improving the strength and ductility of aluminum and related casting machinery drive the demand in the market. For instance,

In September 2020, Tesla CEO Elon Musk announced that for the new Model Y, 70 components glued and riveted into the car's rear underbody to be replaced with a single module made using an aluminum casting machine.

In general, EVs use aluminum and aluminum extrusions to improve fuel economy (in PHEVs) and provide better range (in BEVs), safety, and overall driving aesthetics. Extrusions can commonly be found in space frames, doors, hoods, hang-on parts, trunk lids, bumpers, crash boxes, bodies in white, and car bodies, among other components.

The high thermal conductivity of an aluminum extrusion part deems it an excellent option for removing heat from the vehicle. Alloy strength and extrusion profile also play a critical role when considering EV crash management.

Asia-Pacific and Europe to Play a Significant Role in the Market

Asia-Pacific and Europe are projected to be highly lucrative markets, followed by North America, during the forecast period, primarily due to the presence of a prominent automotive industry in China, Germany, Japan, and India. The rising demand for electric vehicles across Asia-Pacific is likely to boost the automotive aluminum extrusion market in the region.

The surging demand for electric vehicles due to stringent emission norms across Asia-Pacific is likely to propel the aluminum extrusion market across the region. In addition, the growing demand for different commodities required as battery enclosures and structural components in electric vehicles can fuel the rise of the regional market.

Europe has the presence of major OEMs and tier-1 suppliers with advanced R&D facilities, which is anticipated to boost the automotive aluminum extrusion market across the region. The enforcement of strict regulations on vehicular and greenhouse gas emissions can contribute to the market's growth.

North America is also anticipated to play a significant role in developing the automotive aluminum extrusion market, with the United States holding the majority market share in the region. The growth in the region can be attributed to the implementation of Corporate Average Fuel Economy (CAFE) standards in the region.

Competitive Landscape

The automotive aluminum extrusion market is moderately consolidated. The market is characterized by the presence of considerably large players that have tie-ups with major automotive manufacturers. The companies are entering strategic partnerships, acquisitions, and product developments to expand their brand portfolios.

Some of the important players in the market include Novelis Inc., Constellium NV, Norsk Hydro ASA, Kaiser Aluminum, and Kobelco Aluminum Products & Extrusions Inc.Key players are investing in expanding their facilities across the world. For instance,

• In May 2022, Novelis Inc. announced plans to invest over USD 2.5 billion in Baldwin County, Alabama, to establish new low-carbon recycling and rolling factory. The factory at the 3,000-acre South Alabama Mega Site in Bay Minette will initially have a capacity of 600 kilotons of finished aluminum items per year, with the flexibility to enhance capacity in the future.

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• The market estimate (ME) sheet in Excel format
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