The global automotive aluminum market size was valued at USD 73.21 billion in 2021 and is predicted to reach at USD 156.53 billion by 2030, increasing at a CAGR of 8.81% from 2022 to 2030. Alloy sulphates are formed from bauxite and contain different elements like vanadium oxides and silicon as well as aluminium hydroxide and titanium as well as sulfuric calcium and gallium carbonates. Aluminium is significantly lighter than steel, has a high tensile strength, and can be moulded easily. Aluminium is a popular metal in a variety of sectors because of these advantages. Because of aluminium’s low cost, the automotive industry is a major user of the metal. Aluminium’s high fuel economy is yet another reason for its use in vehicle construction. It minimises carbon emissions and is more environmentally friendly than steel-built automobiles. The longevity and performance of automobiles can be improved by using aluminium. For instance, automotive manufacturers are combining aluminium with polymers and fibreglass to enhance certain qualities. The energy absorption of aluminium is also two times more than that of mild steel.
As a result of its great durability, safety, and fuel efficiency, aluminium is widely used in commercial vehicles as well as automobiles. Aluminium is in high demand for automotive applications because of its low weight and high strength while also being good for the environment. Aluminium’s demand has risen sharply as a result of the metal's increased recycling potential, and this is expected to continue.
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An Increase in Global Automobile Production
The worldwide automotive aluminium market's overall expansion is being fueled by a dramatic increase in automobile production and sales. Because of the dramatic increase in the number of people driving personal vehicles, aluminium is in high demand as an automotive component, particularly in Asia Pacific's growing economies. As China continues to outpace the United States in the global passenger-car-industry, the Asia Pacific region and its enormous hunger for passenger vehicles are projected to be one of the major drivers of the worldwide automotive aluminum market over the projection period of the research.
It is expected that the Automotive Aluminum Market will grow over the forecast period because of rapidly increasing demand for electric-vehicles as well as the integration of innovative systems that would provide safety and comfort. Additionally, its widespread application is projected to augment the overall market growth due to characteristics including thermal conductivity and electrical conductivity, corrosion resistance, recycling and high strength.
Improvements Made to The Vehicle's Driving Dynamics
Aluminum's demand among automotive manufacturers has increased thanks, in part, to the performance benefits connected with the material, which include its low weight and resistance to denting. Aluminum has been increasingly popular as a multifunctional material of choice in the body structures of luxury automobiles, such as those manufactured by Ford, Audi, and Mercedes-Benz. These structures include the engine, transmission, as well as wheels. In addition, stringent environmental restrictions taken to combat an increase in greenhouse gas emissions have contributed to an increase in the demand for aluminium.
The shift in customer tastes toward more lightweight automobiles has resulted in an acceleration in the demand for aluminium, which has led to a rise in the demand for passenger cars. In addition, the need for aluminium in large commercial vehicles is anticipated to generate profitable growth prospects as a direct result of the surge in consumer demand for items that require transportation. It is anticipated that an increase in the number of applications of aluminium as a substitute for steel would lead to an increase in the demand for aluminium in automotive applications.
Due To Aluminum's Fluctuation in Price and The High Cost of Aluminium
Automotive aluminium market growth has been hindered by the fluctuation in aluminium prices and the high cost of aluminium compared to steel. As a result, other lightweight materials like magnesium as well as reinforced plastic are projected to further harm the sector. The Automotive Aluminum Market's growth is expected to be hampered by aluminum's higher manufacturing costs compared to steel in the forecast period. Growth in automobile production is expected to be hindered by growing production costs. There was also a negative impact on the Automotive-Aluminum-Market due to supply chain disruptions, demand share disparities, economic conditions and the immediate and long-term effects of the COVID-19 pandemic. The whole market's economic growth has slowed as a result of the crisis.
The Expanding Role of The Government in The Provision of Robust Opportunities
Furthermore, the effect of government policies that encourage the production process of vehicles which emit fewer greenhouse gas emissions, thereby also boosting the carbon emissions of vehicles, is having a positive impact on the development of the market. This is also having a positive impact on the development of the carbon dioxide emissions of automobiles. Aluminum is becoming more common in automobiles for a number of reasons, one of which is the proliferation of stringent government laws that promote the development of vehicles that make use of materials that are both environmentally friendly and less heavy. Recyclable is 90% of the aluminium that is used in car construction. In addition, aluminium has a lower mass than steel does, which means that cars constructed out of aluminium are significantly lighter in weight in comparison to those constructed out of steel. As a consequence of this, aluminium gives car manufacturers the opportunity to produce vehicles that are not only good for the environment and efficient in their use of energy, but also have a high-performance level and are resistant to corrosion. All of this will result in the creation of new opportunities in the global market for automotive aluminium.
The global automotive aluminum market is divided into different segments according to the End Use, Application, and Region.
By End Use, the global automotive aluminum market is segmented into Passenger Cars, Light Commercial Vehicles, and Heavy Commercial Vehicles. In 2021, passenger automobiles held approximately 70% of the market share as measured in terms of revenue. The implementation of stringent regulations for CO2 emissions in countries all over the world has led to an increase in the demand for products that weigh less in passenger cars. Aluminum allows for a significant reduction in the weight of a vehicle's numerous components, which leads to an improvement in the vehicle's overall fuel efficiency.
An increase in the demand for light vehicles as a result of advancements in logistics and transportation, in conjunction with stricter standards for fuel emission, is likely to promote an increase in the production of pickup vans, light trucks, as well as electric small trucks. This growth is likely to be driven by a combination of factors. When it comes to light commercial vehicles, the utilization of lightweight metals such as aluminum offers options that improve safety, lower fuel costs, and increase hauling efficiency.
It is anticipated that actions taken by the government on behalf of automakers will generate growth prospects in the market. In July of 2018, the government of India made an announcement that the load-carrying storage of trucks will be increased. This was done to prevent vehicles from being overloaded and to lower the costs of logistics for consumers. It is anticipated that this will result in an increase in the market for heavy vehicles across the nation.
By Application, the global automotive aluminum market is segmented into Body Structure, Powertrain, Suspension, and Others. From 2022 through 2030, it is anticipated that the powertrain segment will grow at a compound annual growth rate (CAGR) of 9.29% in terms of volume. A favorable influence has been produced on the market for electric vehicles as a result of the increasing interest in hybrid technology, which has also contributed to improvements in fuel efficiency and reductions in fuel emissions. In the future years, there is expected to be an increase in the demand for electric vehicles, which will result in the creation of new prospects for hybrid and electric powertrains that contain aluminium.
In terms of market share in terms of revenue, the body-structure-application accounted for almost 35% of the market in 2021. This expansion can be ascribed to rising production capabilities in China, the United States of America, and India. For illustration, in August of 2018, Toyota made public its intention to raise its manufacturing capacity by around twenty-four percent on an annual basis by opening a new facility in Guangzhou, China.
Cast spun aluminium wheels are increasingly being employed in the production of automobiles due to the fact that their use reduces the overall weight of the system, which in turn results in lower springtime rates and better vibration dampening. In terms of capacity, the suspension sector of the worldwide automotive aluminium market accounted for a major share of 31% in 2021 and is anticipated to rise at a CAGR of 6.59% from 2022 to 2030.
By Region or Geography, the global automotive aluminum market is segmented into North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa. Over the forecast period, Asia Pacific is expected to remain the most lucrative regional market. In 2021, the region accounted approximately 40% of revenue. It is predicted that North America would grow at a CAGR of 11% throughout the projection period.
The global automotive aluminum market is segmented by geography into North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa.
Regional Growth Insights Request Sample Pages
Over the course of the forecast period, it is anticipated that the Asia-Pacific region will continue to represent the greatest regional market in terms of revenue. In the year 2021, the area was responsible for forty percent of the revenue share. The primary growth factors are the expanding market for automobiles in nations such as China as well as India as well as the increased investments in the region's automotive sector. The Volkswagen Group made the announcement in July 2018 that it intended to make an investment of around 1.12 billion US dollars in India by the year 2021 in order to increase its footprint in the nation.
During the time of the forecast, it is anticipated that growth in revenue in North America will occur at a CAGR that is greatest, coming in at 11%. Aluminum usage in the automotive sector in the region is likely to increase in the coming years as a result of consumer desires toward excellent quality as well as fuel-efficient motor vehicles combined with stringent CAFE regulatory frameworks to enhance the fuel efficiency of the vehicles. The goal of these regulations is to improve the vehicles' overall fuel economy.
It is projected that the construction of new factories, the implementation of new policies, and the development of innovative technologies would propel the automotive sector in Europe. For example, in July of 2018, BMW made public their intention to invest 1.71 billion US dollars in a brand-new automobile facility in Hungary. As a result, there is an expectation that the expansion of existing production units would result in an increase in demand for aluminum in the Europe's automotive industry.