Revved-up demand from the automotive sector will likely bolster
die casting production in the fourth quarter, most
manufacturers said at the North American Die Casting
Associations Die Casting Congress in Louisville, Ky.
The positive outlook
comes as producers continue to grapple with increased demand
for lightweight auto components and ongoing concerns with the
London Metal Exchanges North American special aluminum
alloy contract (Nasaac) (
amm.com, May 22).
While some balked at
the difficulties presented by manufacturing lightweight
components, most called lightweighting beneficial to the
extremely positive for our sector as it is spurring a ton of
new designs and has, thus far, generated a lot of work for the
industry," one die caster source told AMM, adding that
those who dont participate in manufacturing lightweight
components could miss a majority of future automotive business.
"Everything is getting lighter and people have to start to
understand this whole thing is by no means going away."
Others said that until
problems with Nasaac are resolved, robust automotive demand
will continue to be countered by sagging margins and delays in
delivery of metal from warehouses. "All of our problems would
be solved if we could just get this metal out of the
warehouse," a second die caster source said. "We will continue
to put pressure on the London Metal Exchange until the contract
becomes a viable tool."
Storage fees remain
unreasonably high despite a perception of increased government
oversight, according to a third die caster source. "The fees
and interest paid on this metal is ridiculous," he said, adding
that he would rather not participate in the contract
altogether. "The purchase price needs to reflect the contract
price; otherwise its a losing proposition. Its that
concerns about the viability of Nasaac, most die casters noted
that increased demand from the auto sector continues to be a
boon for the industry. "We really didnt expect things to
be as strong as they are going into the fourth quarter," a
fourth die caster source said. "Hopefully, it will carry into