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Steel faces challenges in auto: Shiloh chief

Feb 28, 2014 | 04:53 PM |

Tags  Shiloh Industries, automotive, die casting, Ramzi Y. Hermiz, General Motors, Ford Motor, Valley City, Ohio Indiana

NEW YORK — Despite a push by the steel industry toward making lighterweight components for the automotive market, steel manufacturers have their "work cut out for them," especially as aluminum applications continue to capture additional market share, Shiloh Industries Inc. president and chief executive officer Ramzi Y. Hermiz said in an exclusive interview with AMM.

The cost of developing technology that can effectively reduce the weight of steel components without sacrificing strength or ductility is a major challenge facing the steel industry, Hermiz said.

"They (steelmakers) are working on (new lightweighting technologies) and they need to continue to develop them to prevent other OEMs (original equipment manufacturers) converting to an aluminum piece," Hermiz said in reference to a question about major domestic automakers—particularly Dearborn, Mich.-based Ford Motor Co. and Detroit-based General Motors Co.—transitioning to aluminum bodies for their pickup trucks.

Valley City, Ohio-based Shiloh, which designs, engineers and manufactures first-operation blanks, engineered welded blanks, complex stampings, modular assemblies and highly engineered aluminum die casting and machined components serving the body-in-white, chassis, emission, powertrain, structural and seating needs of OEMs and their Tier 1 suppliers, has shifted its market strategy in recent years toward developing lightweight solutions using steel and aluminum, Hermiz said.

And while some industry insiders have called steel’s prospects for continued dominance in the automotive market somewhat grim (, Oct. 31), Hermiz cited several key factors that may prove to be beneficial for the industry.

Emerging international automotive markets with less-advanced auto manufacturing capabilities, for example, likely will rely on steel components for the foreseeable future, Hermiz said.

"If you have a low-cost vehicle and it already has a very small power plant, the benefit of making that vehicle even lighter—there may not be a cost return on that," he said, noting that lightweighting is solely dependent on what is driving the use of such applications. "So for an inexpensive entry car that already gets 40 miles to the gallon, the cost of converting that to further lightweight materials ... may not necessarily have a return."

Hermiz also referenced recent technological breakthroughs by engineers at Shiloh as further evidence that steel’s future may be bright. "By taking our laser weld, adding high-strength steel and welding it with another steel material, we are making the total weight less," he said. "Our technology is enabling an extended use of steel and making steel still a lightweight solution—and in a way that doesn’t impact an assembly line."

Hermiz said that talk of automakers moving exclusively to aluminum was overhyped. "The material strategy is going to be a use of both aluminum and steel, and I see that for the foreseeable future," he said. "The steel industry is going to continue to develop lighter material. They are not going to just abdicate their market to the aluminum coil processing people."

Regardless of any future shifts in material strategy, Shiloh is well positioned to take advantage of lightweighting trends in aluminum and steel, Hermiz said.

"We really started to make (lightweighting) our market strategy, or public strategy, in the past couple of years," Hermiz said, noting that the company recently announced plans to spend nearly $8 million to expand two Indiana aluminum die-casting plants in an effort to support increased demand for advanced lightweighting technologies.

The company also is working with Ford and GM to develop future aluminum strategies, Hermiz said. Ford recently unveiled its aluminum-bodied F-150 (, Jan. 13), and while GM has not publicly disclosed plans for aluminum use in future pickup models, insiders said the automaker’s move to aluminum likely will happen in 2018 (, Feb. 19). "We think it’s the right strategy. If you look at people like Jaguar, Land Rover and Range Rover—they’ve been all-aluminum for years."

Moreover, within aluminum applications, automakers have begun to seek ways to make existing components even lighter, Hermiz said. "We’re doing work with one OEM on a part that is already aluminum; it’s a casting, ... but because of our unique technologies we are making an existing aluminum part even lighter."

Hermiz said that Shiloh’s ThinTech process and squeeze casting process allows the company to do "some things a little bit different" in an effort to "look at parts and figure out how to make them even lighter."

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