Global vehicle production is expected to continue to grow in the next 10 to 20 years. Challenges for steelmakers supplying the sector will also continue to increase according to experts at a meeting to discuss the future of the automotive sector in Turin last week, attended by Kallanish.
Gianpiero Mastinu, professor of vehicle construction at the Milan Polytechnic confirmed that expectations are for motor vehicles production to reach 150 million units in the next 10 to 20 years. Almost 100 million vehicles were produced globally in 2018, with China being the biggest producer followed by Europe. In 2003 China accounted for less than 10% of the global production while its share has now reached almost 30%.
Despite the positive outlook in terms of vehicle construction, uncertainties remain for steelmakers. This is specifically so for those based in Europe, which was the largest vehicle-producing region with over 30% of global share until ten years ago.
Gianfranco Tosini from Siderweb, noted that the first issue for steelmakers is to reorganise their presence to be closer to where vehicles will continue to be produced. This indicates therefore that Asian mills are better placed than their European counterparts.
The second issue remains the reduction of the volume of steel used in carmaking. In 2015, 84% of the mass of a car was made of steel on average, including conventional grades, high-strength steels and electrical steels. Now the percentage has fallen to below 60% on average with high-strength and ultra-strength steels taking the lead as the most-used materials in car manufacture.
Aluminium meanwhile has doubled its importance in the car sector, but problems linked with costs and technical specifications remain if it is to continue to grow its share of the market.
“If we look at Europe, we need to highlight that the biggest challenges will be faced by flats’ producers, due to the need to remain competitive despite the challenges of volumes, proximity and specialisation. Longs producers for specific automotive materials seem to be better placed and more flexible to meet the changing demand from the sector going forward,” Tosini concluded.