Atlanta-based Novelis, the world leader in aluminium rolling and recycling hopes to continue its partnership with China and expand investment in China's electric vehicle sector and other automotive ventures.
Novelis selected Changzhou, in Jiangsu province, as the site for its first manufacturing facility in China in 2014, due to its logistic facilities and government incentives schemes for foreign investment.
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The Changzhou plant now produces 120,000 tons of heat-treated aluminium sheets annually and meets the growing demand for rolled aluminium from automakers to be used in conventional as well as lighter, more fuel-efficient new generation vehicles.
"The driving force behind our business strategy in China is the nation's increasingly strict policy against pollution," said Pierre Labat, vice-president for global automotive at Novelis, told China Daily.
China has issued strict environmental regulations and proposed amendments to emissions rules which have resulted in a boost to electric vehicle (EV) manufacture and sales. Auto manufacturers are required to meet sales targets for EVs and plug-in hybrid EVs by 7% and 19% by 2020 and 2025.
After setting a strong foothold in North America, Novelis now plans to leverage on the transformation of China's automotive industry and grow its existing business in the world's second-largest economy.
"If we look at our total automotive sales in the world, China is currently about 10 percent, fairly small," said Labat. "But it's our fastest growing market that yields highest-percentage of growth, six-fold explosive growth since we went there five years ago."
In March, Novelis expanded its automotive customer portfolio into the EV sector by adding Shanghai-based electric vehicle startup NIO to its client list. NIO's electric SUV ES8 models will adopt Novelis' aluminium alloys to make vehicle components and parts. The NIO deal marks Novelis' first major business commitment in the premium EV market in China.
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"We are now positioning ourselves as being more than a material supplier. We are collaborators and problem solvers to meet the increasing demand from a new generation of automakers," Todd Summer, Novelis' vice-president of global research and development said.
He also added that the supply for NIO will come from the Changzhou plant that has hired around 200 local employees. Novelis has relied solely on the Chinese local team and built a strong relationship with the local government in last five years to develop business in China.
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