NEW YORK Fiat Chrysler Automobiles (FCA) has flagged "reservations" about the use of aluminum for its lineup of pickup trucks, including the 2017 update to its Ram truck, chief executive officer Sergio Marchionne said during an earnings conference call May 6.
"We internally have reservations as to whether we think aluminum is the right solution on the truck side," he said. "The main objective for the 2017 intervention is to continue the lightweighting process on the vehicleits the only way we can get substantial improvements in mileage."
The automaker continues to watch "with some intensity" the rollout of Ford Motor Co.s all-aluminum F-150 pickup, Marchionne said. "The mileage on the 3-liter EcoDiesel in the Ram 1500 today is better than the Ford F-150 will have with the aluminum body, at least in terms of what they have announced as mileage numbers, so we have to be very, very careful that we dont invest in technology for no returns."
In response, a Ford spokesman told AMM that mileage figures for the 2015 F-150 hadnt yet been announced. "(Ford) EcoBoost delivers an ideal combination of performance and fuel economy," the spokesman said, noting that diesel fuel costs about 30 cents per gallon more than regular gasoline.
Marchionne noted that the relatively high cost of aluminum production and development of aluminum-related infrastructure might bode well for the continued usage of steel. "We understand fully the cost of making aluminum bodies," he said. "Certainly we understand the technology associated with body shops. I think the usage of aluminum in our portfolio is better suited for other products than a pickup truck."
Marchionne joins a growing list of automotive executives and analysts who have expressed concern over the high cost of aluminum vs. steel.
"Its interesting that the three different truck makers have taken three different steps in an effort to tackle fuel efficiency. Fords solution is to use aluminum, GMs solution is to go to smaller trucks and Chryslers solution is to develop powertrain technologies," one industry insider told AMM.
Aluminum demand is at risk largely due to high costs associated with establishing infrastructure used to manufacture and service automotive aluminum, Bernstein Investment Research & Management senior analyst Paul Gait, said in a recent report (amm.com, May 5).
However, most major aluminum manufacturers believe that industry analysts and auto manufacturers will see that the benefits of aluminum will eventually outpace cost.
Tom Boney, vice president and general manager of Novelis North American automotive business, had also noted May 5 that its not credible to suggest that aluminum is getting priced out of the automotive market at the same time that the light metal is winning historic gains in the sector.