The automotive industry's demand for aluminium is expected to surge by 15-27 per cent, driven by the growing prevalence of electric vehicles (EVs). In comparison to traditional internal combustion engine cars, plug-in hybrid and full battery electric vehicles utilise 25-27 per cent more aluminium, with a baseline of 160kg per vehicle in internal combustion engines.
Under the agreement, Kobe Steel will hold a 50 per cent stake in the new entity, while Baosteel and Baowu Aluminum will jointly own the remaining 50 per cent. The precise ownership split between Baosteel and Baowu Aluminum has not been disclosed.
However, pending regulatory approvals, the venture is set to be established in Shanghai with a registered capital of RMB 900 million ($125 million). It will operate under the provisional name Kobelco Baosteel Automotive Aluminum Rolled Products.
The joint venture will focus on manufacturing aluminium sheets for domestic automobile manufacturers in China, with production facilities planned in Tianjin and central Henan province. This strategic partnership reflects a growing trend of international collaboration to meet the rising demand for automotive materials, especially in the rapidly expanding Chinese market.
The companies had previously announced a feasibility study for this joint venture on February 26, paving the way for this formal agreement.
