Automotive Aluminum Market Set to Propel by Efficient Production of Lightweight Vehicles

The automotive aluminum market comprises aluminum extruded parts, aluminum rolled products and aluminum cast parts which are widely used in passenger cars and commercial vehicles. Aluminum is gaining popularity in the automotive industry due to its lightweight and highly durable properties helping automobile manufacturers to achieve weight reduction and improve fuel efficiency. The use of aluminum significantly reduces vehicle weight allowing increased passenger and cargo space without compromising safety. With stringent regulations regarding vehicular emissions, aluminum is being increasingly adopted by OEMs for body panels, wheels, transmission parts and engine components.

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.

Key Takeaways
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 Tinto Group.

The growing popularity of electric vehicles around the world is augmenting the demand for automotive aluminum significantly. With the increasing range and battery capacity requirements, aluminum usage is growing extensively in electric powertrains for its high strength-to-weight properties.

Major automotive aluminum manufacturers are focusing on strategic expansion plans and capacity additions across regions. For instance, Novelis and AMG signed agreements with automakers to supply aluminum for electric vehicles manufactured in Europe and China, supporting the global shift towards sustainable mobility.

Market key trends
One of the prominent trends in the automotive aluminum market is the shift towards recycled aluminum content with closed-loop, alloy-to-alloy recycling. Recycled aluminum requires 95% less energy to produce and helps lower the carbon footprint of automakers. Manufacturers are actively procuring post-consumer and post-industrial scrap to boost recycling rates and achieve sustainability targets.

Porter's Analysis
Threat of new entrants: The automotive aluminum market requires high capital investments and economies of scale drive down the costs, limiting the threat of new entrants.
Bargaining power of buyers: Automobile manufacturers have significant bargaining power over aluminum suppliers as they can switch suppliers.
Bargaining power of suppliers: Few large players control the global supply of aluminum, giving them strong bargaining power over automobile producers.
Threat of new substitutes: Alternative lightweight materials like carbon fiber and advanced high-strength steel pose a growing threat.
Competitive rivalry: Intense competition exists amongst established players to further aluminum usage through innovative production technologies and aluminum alloys.

Geographical Regions
North America currently holds the largest share of the global Automotive Aluminum Market in terms of value, led by the United States. Strict emission norms have increased aluminum usage in vehicle production across America.

Asia Pacific is expected to grow the fastest during the forecast period led by China, India, and Japan. Rising disposable incomes, growing middle class, and stricter fuel efficiency standards are driving aluminum consumption in the automotive industry across emerging nations in Asia.

 

About Author:

Ravina Pandya, Content Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials,  etc

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research

2. We have leveraged AI tools to mine information and compile it