At the UN’s 2021 Climate Change Conference (COP26) in Glasgow, Scotland, six automobile manufacturers, including General Motors, Mercedes-Benz, Ford and Volvo, plus 30 countries worldwide, pledged to phase out their new petrol and diesel vehicle sales by 2040.
The EV market is hotting up, and so is aluminium!
In pursuit of lowering carbon footprint and the growing emphasis on adapting environment- friendly technologies, the future of electric vehicles seems to be promising. This is not just good news for the automotive industry, the future of which undoubtedly seems bright, but also the rise in demand for EVs is the harbinger of hope for the aluminium industry. Now that the era of EVs is unfolding, aluminium is all set to become the metal of the hour.
EV Growth Scenario
According to Fortune Business Insights, it is believed that the global electric vehicle market is currently valued at USD 287.36 billion. This figure is USD 40 billion higher than the market size valued in 2020. Furthermore, it is likely to rise by 24.3% CAGR and hit USD 1.3 trillion or more by 2028.
The question is, what is contributing to this proliferation? As consumers are trying to reduce greenhouse gas emissions, electric vehicles are steadily taking centre stage. The biggest economies throughout the world, like the UK, Norway, and China, are rapidly shifting to battery- operated vehicles, and the oil industry will soon feel the heat. The next two decades will be crucial for the EV sector as investors and automakers plan on investing almost USD 244 billion in electric vehicles, and China plans on accounting for 40% of the total volume, as reported by Aluminium Insider.
All of these statistics are vital for the downstream aluminium industry because aluminium seems like the dream metal for automobile manufacturers, and therefore, its demand is on the rise.
The future of aluminium driven by EV
Why are EV makers inclined towards aluminium? Aluminium is a lightweight metal and using it to make EVs automatically reduces the car’s weight. The reduced weight allows the makers to reduce the size and cost of the batteries, which extends the car's range.
CRU analyses that by 2030, 10 million tonnes of aluminium will be needed for EVs, which is 10 folds higher than the demand in 2017. It also says that an EV requires 25% to 27% more aluminium than any ICEs today.
The fight between aluminium and steel continues
There was a time when the silvery white aluminium was shunned, and manufacturers turned towards a cheaper alternative, steel. However, as electric vehicles are taking over, aluminium is making a glorious comeback. Brands like Tesla, which is one of the prominent EV manufacturers, have used aluminium in making its first two EV models- Tesla Model S and Tesla Model X.
If the predictions of the WardsAuto and DuPont Automotive survey are to be believed, then aluminium will soon become the most preferred material by manufacturers and researchers to meet all emission standards by 2025. What does it mean for the steel industry, and will it fade away in the future?
Jumping to any conclusions right away will not be logical. Although aluminium is a high- performing metal as compared to steel, the latter is unlikely to give up its space anytime soon. There are a number of factors to be considered. If automobile manufacturers want to make EVs affordable, they’ll have to strike a balance between metallurgical advantage and cost- effectiveness.
As per recent research by Ducker Worldwide, the content of aluminium will grow from 11% to 16% from 2017 to 2025. Furthermore, the content for AHSS will also rise from 7% to 10% during the same period. However, the growth will surely be in favour of aluminium.
Why are makers of EVs turning towards aluminium?
Aluminium has got a new nickname, 'EV manufacturer's dream metal'. But why? The features of aluminium make it a manufacturer's favourite. The primary reason is its lightweight. The non- ferrous metal weighs about one-third of steel per cubic foot, making the vehicle extremely light.
Additionally, aluminium is also better at ensuring the safety of the passengers. It absorbs the majority of the energy caused during an accident and protects the car structure and its passengers. According to an industry expert, the automobile industry is willing to pay a higher price for aluminium (about thrice that of steel) to enjoy the advantages of aluminium. The use of aluminium is not only limited to making the body of cars or charging stations.
Innovative use of aluminium in EVs:
Aluminium is finding varied and innovative uses in the automobile industry. Some of the notable use cases are:
1. Aluminium air battery: Lithium-ion batteries are predominantly used in EVs. However, their major downside is they cannot be recharged in case of a full discharge. Additionally, they are susceptible to damage due to temperature variations during charging. In order to find a more sustainable alternative, aluminium air batteries are invented, which are game changers for EVs. These affordable and long-range batteries produce power using aluminium and oxygen. They are significantly lighter than conventional batteries.
2. Battery housing: Another notable use of aluminium in EVs is battery housing. Although the experts have set their minds on a standard for battery housing, big brands like Audi PHEVs are using cast aluminium battery housing.
Therefore, besides using aluminium in making the bodies of EVs, this metal is also being used for other essential aspects of automobiles. It has the ability to absorb a more considerable amount of crash energy than any other metal and ensures that vehicular performance enhancements do not come at the cost of safety.
Bottom line:
As makers of electric vehicles strive to mass-produce EVs and make them affordable for the masses, the demand for aluminium will only rise in the future. However, more significant production implies more complex models, and therefore, a mix of aluminium and steel and advanced alloys will become frequent. Although an inflated demand does not promise an increased price for the metal, it is undoubtedly paving the way for an industrial boost and avenues for new uses and opportunities in the automotive industry.
