PALM BEACH, Fla.
Sapa Group aims to speed material substitution and boost
its participation in the growing automotive sector as it
grapples with lackluster demand in other industries, a company
executive said Oct. 29 on the sidelines of the Metals Service
Center Institutes aluminum products division conference
in Palm Beach, Fla.
"You hear a lot of
predictions about what next year is going to be like, but none
of them would be in the high-growth categoryits
just a matter of how sluggish the economy is going to be,"
Charlie Straface, vice president and general manager of
industrial at Sapa Extrusions North America, part of the Sapa
Extrusions-Americas business, said in an interview.
Given that difficult
backdrop, Sapas Americas business, based in
Rosemont, Ill., is looking to create new applications for
aluminum extrusions by converting applications in the power
transmission sector to less expensive aluminum from copper and
by replacing automotive steel with lighter-weight aluminum,
The goal is to spark
demand for Sapas products even in the current sluggish
market. "Thats the challenge of a slow-growth market: you
need to innovate," he said.
Sapa is also investing
in its facilities to improve quality and slash the time
required to make products, Straface said. It has invested about
$34 million in a new indirect press line at its Cressona, Pa.,
amm.com, Sept. 5) that is expected to be fully
operational by Jan. 1.
"We can go from the
start of the process to on a truck in eight hours," Straface
said, adding that the company is also starting a new press in
Because of tepid
demand in markets like distribution, Sapa is aiming to boost
its participation in the automotive market, Straface said,
noting that automotive companies are looking to increase
aluminum content both in auto body sheet and extrusions due to
stricter fuel economy standards.
extrusions include bumper systems and crumple zones or "crash
cans" and even the cab structure of vehicles, Straface said.
"There is just a lot of momentum for aluminum in vehicles, and
we have a lot of investment going on to make sure we have the
capacity and the technology" to meet expected increased demand,
Sapa will also focus
on hydroformed aluminum tubes, which could be "really big," he
said. "Hydroforming is going to be a process that is going to
need to work really well for aluminum (extrusions) to continue
book to date has mostly been Tier 2 or Tier 3 suppliers. "But
now with the (Detroit-area) Big Three really looking at
aluminum, we are in conversations with those guys. So we are
excited about the growth and the use of more aluminum, but we
need to do it in a sound business way," Straface said,
declining to say which vehicle programs Sapa might be
supplying. And while automotive business offers high volume, it
doesnt guarantee high profits, he cautioned.
Also helping Sapa on
the auto front is its recent 50-50 joint venture with Oslo,
Norway-based Norsk Hydro ASA (
amm.com, Sept. 3), which has brought Sapa four new
10-inch presses in North Liberty, Ind.; Belton, S.C.; Phoenix;
and St. Augustine, Fla. Often used for auto applications, the
10-inch presses could help the company should automotive demand
"take off," Straface said.
The joint venture also
gives Sapa a bigger footprint, which the company will spend the
next six months examining closely.
"Our goal is to use
all those assets by growing our business. ... If we cant
do that, there might be some small plant footprint decisions
that might have to be made, but not of significance," he said.
Any changes could involve as few as one facility, he added.