Novelis Inc. will invest approximately $180 million to double its automotive aluminum body sheet capacity at its Changzhou facility in China. The investment will be a continuous annealing solution heat (CASH) treatment line that will add approximately 100 kilotonnes of capacity and will include a high-speed slitter as well as a fully automated packaging line.
These assets along with a proven operational expertise and first-mover advantage in China will enhance Novelis’ ability to supply innovative aluminum solutions to its global automotive customer base as well as Chinese domestic producers. Novelis expects to begin expanding its existing facility in 2018 in order to be operational by 2020. Upon completion, Novelis expects to create approximately 160 full time jobs.
Since commissioning its initial automotive finishing line in Changzhou in 2014, Novelis has fully contracted its capacity. The timing of this investment is closely aligned with key customer product launches slated for 2020 to 2021 from both traditional automakers as well as electric vehicle startups.
“By adding another strategic asset to expand its operations in China, Novelis continues to leverage the strength of the Aditya Birla Group as the global leader in aluminum rolling,” said Kumar Mangalam Birla, chairman of the board of directors of Novelis Inc. and chairman of the board of directors of Hindalco Industries Limited.
Worldwide, automotive aluminum demand is projected to nearly triple over the next eight years with the largest growth potential to be in China, as both domestic and global automakers increase aluminum penetration and production in the market.
According to IHS Markit, total passenger vehicle demand in China is expected to reach 34 million units by 2025, with strong market growth coming from battery electric vehicles.
Novelis’ investment in China is its second automotive investment this year, having recently announced a $300 million greenfield manufacturing facility in Guthrie, Kentucky.
Published in the July 2018 Edition