18 OCT

2018

Asset Class , Green Metals , SRI

Aluminium, from planes to automobiles

Responding to climate change issues has obliged the automotive sector to review its practices and develop vehicles which consume less energy and are lighter in weight. In the search for the ideal material, aluminium, traditionally prized in the aerospace sector, could be one of the main winners.

In 2014, Ford presented its F-150 pick-up truck at the Detroit automobile show, the first mass-produced vehicle with a body 95%-composed of aluminium. Will the recognised benefits of aluminium cause the automotive sector to reconsider this material as a tangible solution for reducing vehicle weight?

Although aluminium is significantly more expensive than advanced and ultra-high strength steel (AHSS & UHSS), compared to the potential weight reduction, the price gap has narrowed considerably. Aluminium is therefore becoming a viable solution, particularly with regard to other materials such as magnesium and carbon fibre, which are still too costly to be used on a large-scale basis.

Aluminium production is particularly energy-consuming. During the production phase, aluminium consumes almost twice as much energy as steel. The major advantage of aluminium, however, is that CO2emissions are generated by electric power. Therefore, if 100% renewable energy is used, most CO2emissions can be avoided.

As aluminium is infinitely recyclable without losing its qualities, its use ultimately saves a lot of energy.  Aluminium recycling uses, on average, 95% less energy than its production. In Europe, 95% of aluminium from scrapped vehicles is recycled.

Materials which reduce the weight of vehicles are one of the energy transition solutions in the automotive sector. Aluminium is one of the star materials in this revolution and demand will remain firm with the widescale switch to electric automobiles. On the contrary, particularly as electric batteries can weigh up to 500kg.

In this positive environment, the selection of players that fulfil all our SRI analysis requirements (which focus on aluminium production) is undoubtedly a pledge of long-term performance. Norsk Hydro, which uses chiefly hydraulic energy to produce aluminium, is one of the best-in-class in the sector.