Steel in autos to drop sharply thru 2040: CAR

Market: Coking coal, Metals, Petrochemicals
16/09/20

The amount of steel in automobiles is expected to fall sharply over the next two decades, replaced increasingly by aluminum and plastic, as automakers continue to strive for lighter weight vehicles.

The use of all types of steel in cars may fall by to 46pc of total curb weight in 2040, down from 65pc in 2020 vehicles, the Center for Automotive Research (CAR) said in a 14 September presentation.

Mild steel and high strength steel (HSS) will be most impacted, falling from 40pc of vehicle curb weight in 2020 to just 9pc in 2040, according to CAR.

In 2019, US steel mills shipped 16.8mn short tons (st) of steel to the US auto industry, including for production of automobiles, heavy trucks, trailers and other vehicle parts, according to data from the American Iron and Steel Institute (AISI).

If the CAR forecast holds, by 2040 steel shipments to the US auto industry could fall to 11.89mn st.

The benefactors of lower steel use will be aluminum, whose share CAR projects will double to 26pc in 2040, and plastics, where curb weight is forecast to grow by 150pc to 15pc of total curb weight.

Between 2020 and 2025, steel used in vehicles is expected to fall by 5 percentage points, with a similar drop expected in the following five-year period. Mild steel and HSS are expected to shoulder all of the declines over those 10 years. The use of Generation 3 steel is expected to increase while advanced high strength steel (AHSS) use will remain approximately the same.

The changes comes as the auto industry climbs out of a deep hole dug during the Covid-19 pandemic, when automakers shut down production for two months from mid-March to mid-May and the US economy fell into a recession.

CAR research expects US vehicle production to fall to 6.6mn vehicles in 2020, down by 39pc compared to the 10.9mn vehicles produced in 2019. CAR expects production to recover to 10.5mn vehicles in 2021, climbing to 11.6mn in 2022 and remaining above 11.5mn through 2028.

Total vehicles sales in the USare forecast to fall to 12.9mn vehicles in 2020, down by 24pc compared to the 17mn vehicles sale recorded in 2019. Sales are not expected to recover above 16mn until 2022, and will not reach 17mn in 2024, according to CAR.

By Rye Druzin

Average vehicle structure

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