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F-150 a ‘game changer’ for aluminum: Novelis

Feb 10, 2014 | 10:28 AM | Andrea Hotter

Tags  Novelis, aluminum, earnings results, automotive, Ford Motor, F-150, Philip Martens, Andrea Hotter

NEW YORK — The introduction of an aluminum-intensive pickup truck will be a "game changer" for both the automotive and aluminum industries, according to Novelis Inc., which reported a rise in its fiscal third-quarter net income on the back of higher global shipments.

The new aluminum-intensive body enclosure for Dearborn, Mich.-based Ford Motor Co.’s F-150 pickup truck, revealed at the Detroit auto show last month (, Jan. 13), could use about 1,000 pounds of the light metal per vehicle, analysts estimate. The move is part of Ford’s ongoing effort to manufacture lightweight vehicles capable of exceeding current fuel economy standards.

Novelis, the world’s largest recycler of aluminum and a major rolled products company, produces aluminum automotive sheet. Auto manufacturers are accelerating their use of the product for structural components and exterior body panels.

Novelis is the sole supplier to Jaguar Land Rover and a key supplier to Ford for the F-150.

Philip Martens, the company’s president and chief executive officer, said Novelis is in talks with other automakers regarding the supply of aluminum for various applications, but declined to provide further details.

The company is shifting its activities toward the auto sector in order to tap into this increased demand.

"We’re going to do that globally," Martens added.

In December, Novelis announced a $205-million investment to further expand its global automotive aluminum capacity (, Dec. 17). The company will build new finishing lines at its plants in Oswego, N.Y., and Nachterstedt, Germany, dedicated to the production of aluminum automotive sheet.

The two new lines will each have a capacity of 120,000 tonnes annually.

Martens described the company’s shift toward production for the automotive industry as "very significant" and "more or less permanent," adding that it had a minimum 15-year lifespan.

Atlanta-based Novelis’ shipments of aluminum rolled products totaled 721,000 tonnes during the fiscal third quarter ended Dec. 31, up 11.4 percent from 647,000 tonnes in the same year-ago period.

Novelis continues to see strong demand for aluminum flat-rolled products globally, particularly in the automotive segment, according to Martens.

"We have made great progress in the commissioning of our major expansions, and we are now seeing the benefits of some of these projects in our results," he said in a statement accompanying Novelis’ earnings results. "While external market pressures partially offset the bottom line impact of this volume growth, we are confident about the realizable potential for this business as the new projects come online."

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After witnessing the pace of steel plant idlings and worker layoffs during the first half of the year, what is your view of the second half of 2015? (choose one)

No matter what else happens, layoffs and shutdowns, etc., have nearly or essentially stopped for the year.
The environment will change little and the pace of layoffs will continue at a similar rate as the first half of 2015.
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The environment will improve slightly to moderately yet hiring and plant restarts will not resume this year.
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