Feb. 5, 2014
Constellium, Tri-Arrows Plan Auto Joint Venture
French aluminum company Constellium and Louisville, Ky.-based Tri-Arrows Aluminum, a subsidiary of UACJ Corp., plan to create a joint venture company in the United States to serve the North American automotive market. The venture is expected to include a continuous heat treatment and conversion line with an initial target capacity of 100,000 tons supplied by cold-rolled coils from both partners' rolling mills.
The proposed facility is designed to allow for expansion beyond 100,000 tons. The total joint investment by both parties is estimated to be $150 million.
"Automakers in the United States have already started to convert key models from steel to aluminum, which we believe should translate into a significant increase in demand. We estimate that the U.S. market for body-in-white aluminum rolled products could grow from less than 100,000 tons in 2012 to approximately 1 million tons in 2020," says Laurent Musy, president of Constellium's packaging and automotive rolled products business unit. "Constellium expects to benefit from this significant growth potential. UACJ is the ideal partner for us to serve U.S. customers with high-quality automotive sheets for body-in-white applications like hoods, doors, roofs and structural parts of cars and trucks."
Constellium will own 51 percent of the equity in the joint venture. Constellium and UACJ are working toward signing a definitive agreement in the first half of 2014.
"The goal of this joint venture is to support the ambitious lightweighting programs of the automotive manufacturers in the United States. Taking into account our joint expertise in body-in-white production and strong relationships with key original equipment manufacturers in each market, we believe a joint venture between UACJ and Constellium is the optimal route to pursue this business opportunity," says Mitsuru Okada, CEO of UACJ, Tokyo.