Posted on 25 Apr 2024
Demand for steel from China's automobile manufacturing sector is expected to reach 48.4 million tonnes this year, rising by 2.5% from a year ago, Mysteel predicts in a report published recently. The increasing application of high-strength steel and the growing demand for alloy steel in new energy vehicles (NEVs) are potential trends for the development of steel for automobiles, the report notes.
Steel for automotive use currently accounts for 6%-7% of China's total steel consumption. In the automobile manufacturing process, steel materials account for over 70% of vehicle weight, ranging from 1.1 tonnes in an ordinary sedan to 4.4 tonnes in a coach [see table below].
In pursuit of lightweighting and energy conservation and emission reduction in automobiles, car manufacturers are increasingly using high-strength steel to reduce vehicle weight, improve fuel efficiency and enhance collision safety, according to the report.
High-strength steel has a high strength-to-weight ratio, providing good structural support while reducing car weight, and its high tensile strength and yield strength performance are crucial in key structural components of automobiles, the report emphasized.
At the same time, with the development of NEVs such as electric cars and hybrid vehicles, the demand for specific materials is also increasing. NEVs require lighter, stronger, and more corrosion-resistant materials, such as aluminum alloys, to extend battery life and vehicle performance, Mysteel argues.
Also, NEVs require higher energy utilization efficiency without compromising safety and comfort, which places higher demands on the performance of automotive steel. More importantly, as a key component of NEVs, the drive motor requires non-grain oriented electrical steel with high magnetic sensitivity, low iron loss and high strength, the report showed.
As the market share of NEVs gradually increases, the amount of steel used per vehicle in the automotive manufacturing industry may gradually fall, Mysteel observes.
The main producers of automotive steel across China include Baoshan Iron & Steel Co (Baosteel) and Anshan Iron and Steel Group Co. The Fifth Smart Factory of Baosteel's Silicon Steel Business Unit was put into operation in March 2023, and was the world's first high-grade non-grain oriented electrical steel production line tailored for the NEV industry. It has the annual capacity to produce enough high-grade non-oriented electrical steel for approximately 4 million NEVs, Mysteel Global learned.
On the other hand, China's auto production will still have some room to expand this year, with the growth rate of various vehicle models estimated to be around 2%-3% on year, Mysteel projected.
The data from the National Bureau of Statistics showed that China's total vehicle output came in at 30.1 million units in 2023, higher by 9.3% on year.
Vehicle model | Steel demand | Steel use per vehicle | Vehicle output in 2024E | ||
| 2024E | 2023 | 2022 |
|
|
Sedan | 12,815 | 12,626 | 12,297 | 1.1 | 11,650 |
SUV | 19,093 | 18,537 | 15,913 | 1.4 | 13,638 |
MPV | 1,593 | 1,547 | 1,332 | 1.4 | 1,138 |
Minibus | 245 | 289 | 348 | 1.1 | 223 |
Coach | 2,241 | 2,176 | 1,793 | 4.4 | 509 |
Truck | 12,415 | 12,054 | 9,440 | 3.4 | 3,652 |
Totals | 48,403 | 47,228 | 41,123 |
|
|
Source:Mysteel Global
