Kobe Steel, Toyota Tsusho consider joint venture

The Japanese companies may partner to produce and sell automotive aluminum sheet in the U.S.

May 27, 2014
Recycling Today Staff
Legislation & Regulations Nonferrous
Two Japan-based companies, Kobe Steel Ltd. and Toyota Tsusho Corp., have announced that they are considering establishing a joint venture operation to produce and sell aluminum sheet for automotive body panels and automotive heat exchangers in the United States. The two companies, both headquartered in Tokyo, plan to conduct further studies with the aim of concluding an agreement for the joint venture by the end of September 2014.

The joint venture is envisaged to produce and sell mainly aluminum sheet for automotive body panels, along with aluminum sheet for automotive heat exchangers with operations starting in 2017. In the joint venture plan, Kobe Steel will be responsible for production, quality assurance and business operations, while Toyota Tsusho will market the aluminum sheet. The companies say the joint venture's equipment is anticipated to cover mainly downstream operations.

For the sourcing of the master coils to make the aluminum sheet, Kobe Steel is in talks with Wise Alloys, headquartered in Muscle Shoals, Alabama. Wise Alloys produces aluminum can stock for the beverage and food industries.

In considering a joint venture, Kobe and Toyota Tsusho note that vehicles will be required to achieve a significant increase in fuel efficiency by 2016. By 2025, fuel efficiency will be required to double, the companies say. To reach the efficiency levels, automakers are taking steps to make lighter cars, including increasing use of aluminum panel material. North American demand for aluminum body panels is projected to increase substantially from about 100,000 tons per year to more than 1 million tons in 2020.

Kobe Steel says it maintains more than a 50-percent share of the Japanese market for aluminum panel material. The Japanese steel company says it is accelerating its global expansion to meet the demand for aluminum panel material.

In June 2013, Kobe Steel entered into a technical cooperation agreement with Germany's Hydro Aluminium Rolled Products GmbH for aluminum sheet used in automotive body panels.

In September 2013, Kobe Steel reached a decision to establish Kobelco Automotive Aluminum Rolled Products (China) Co. Ltd. to produce aluminum sheet for automotive body panels in Tianjin, China. Construction of the plant is underway with operations to begin in early 2016.