WCA January 2012

From the americas

generation of automotive steels, a project financed by a $730 million loan from the US Department of Energy; ❖ On the aluminium side, Novelis is investing $200 million to boost production of aluminium automotive sheet at its Oswego, New York, plant, citing growing demand from its customers; ❖ Alcoa in September announced plans to invest $300 million to enable its Davenport, Iowa, works to keep up with automotive demand. The decision was based on business already on the books, but Mr Boselovic said that Alcoa expects growth beyond that. “These are long-term decisions,” Mr Scheps of the Aluminium Transportation Group – who worked with the auto industry before joining Alcoa six years ago – told the Post-Gazette . “These are assets that are going to be in place for 50 years.” In brief . . . ❖ Thieves in North Beaver Township, Pennsylvania, brought a new brazenness to metal theft by dismantling, with the use of a blowtorch, and removing a 40x15-foot steel bridge weighing 40 tons and valued at an estimated $100,000. Pennsylvania State Police said the privately owned structure, an old railroad bridge in an industrial park, was removed in the period 16 th -28 th September. A resident of the rural area about 50 miles northeast of Pittsburgh, near the Ohio border, told CNN affiliate WTAE-TV, “Its old I-beams are probably hundreds of pounds per foot.” The owner, a development company, told local media that it had recently closed off public access to the bridge, which dated to the early 1900s, because of reports of copper thefts in the vicinity. The alleged thieves – two New Castle, Pennsylvania, brothers apparently more clever with their hands than with their brains – were caught. The 15.5 tons of steel they sold piecemeal to a scrap dealer had netted them a little over $5,100 before employees of the scrap yard supplied the police with information leading to their apprehension. As reported by ABC News Radio (18 th October), the brothers face felony charges including criminal mischief, theft, receiving stolen property, and criminal conspiracy, and are being held on $25,000 bail. While rare enough, bridge theft is not unheard of. Citing a report from 2008 by Britain’s Daily Mail , CNN recalled that a group of thieves in Russia dismantled and hauled away a 38-foot, 200-ton steel bridge in just one night.

Mr Bradford told the Pittsburgh Post-Gazette that the challenge for steel makers will be to realise higher profit margins on the next generation of steels than they did from the lower-grade steels to be replaced. “They may be able to make more money if they sell less pounds,” he said. “That’s going to be the trick.” (“Aluminum and Steel Slug It Out to Become the Lighter, Stronger Metal for Cars,” 9 th October). The Post-Gazette ’s Len Boselovic reported that the two industries are pouring millions of dollars into new mills capable of making the lighter, stronger metals needed to cut the weight of a car by about 10 per cent, or 400 pounds. According to Ducker Worldwide, a research firm that advises both steel and aluminium producers, the reduction is essential if the proposed fleet standard of 54.5 miles per gallon of fuel is to be met. Already about 30% of car hoods and 20% of bumper beams are fashioned out of aluminium, and the Ducker consultants forecast greater inroads for the light metal in the years ahead. They estimate that the average vehicle made in North America will contain 550 pounds of aluminium by 2025, up from 343 pounds in 2012. In this scenario, aluminium will account for 16 per cent of the weight of a light vehicle, about double its current aluminium content. Steel’s share will drop from 58 to 46 per cent, the research firm said. Even so, Ducker’s Richard Schultz, who managed Alcoa’s worldwide automotive business in the 1990s, declined to sound “any kind of death knell” for the steel makers. While acknowledging the steady incursions of the aluminium producers, he observed, “Vehicles will still be predominantly steel 20 years from now.” ❖ But the rivalry is on. “We’ve got physics on our side at the end of the day,” Alcoa’s Randall Scheps, who heads the aluminium industry’s Aluminium Transportation Group, told the Post-Gazette . “We can build a lighter car than steel can.” The Post-Gazette article made it abundantly clear that steel makers take the threat seriously; but they claim a strong advantage from having been the partners of the auto makers from the beginning. By steel industry calculations, the steel content of cars actually notched up in recent years, from 63 per cent to 65 per cent. In the view of Lawrence Kavanagh of the Steel Market Development Institute, “We’ve not lost. We’ve gained.” ❖ Mr Boselovic of the Post-Gazette believes that both industries are aware they must work closely with car makers to provide metals for the efficient design and engineering of lighter-weight vehicles. Of the current automotive-related projects of both sets of metal producers, he mentioned these: ❖ US Steel and its joint venture partner, Kobe Steel of Japan, are investing $400 million in a new steel processing line at their plant in Leipsic, Ohio. The equipment will alternately heat and cool advanced steel sheet to give it the strength and flexibility needed to shape it into automotive components. Michael S Williams, who directs US Steel’s North American sheet operations, said the new equipment, capable of producing 500,000 tons annually, will go into production in early 2013; ❖ Russian steel maker OAO Severstal is revamping its Dearborn, Michigan, plant to produce the next

Business

Bucking the tide, Canada does very nearly everything right

Kurt Badenhausen, who covers “data-driven stories” for Forbes, observed that, during the run-up to every US presidential election, countless Americans threaten to move to Canada if their candidate is beaten. While few of them follow through, the 2011 instalment of Forbes’s annual “Best Countries for Business” suggests that a

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Wire & Cable ASIA – January/February 2012