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Brace for a ‘massive transition’ from aluminium to steel bodies

As EVs begin to hit mass-market volumes, the subject of cost efficiency becomes increasingly important. SSAB believes this will naturally lead to rising demand for steel, writes Freddie Holmes

At less than one euro per kilo (US$1.17/kg), steel is the most commonly utilised material within light vehicles, and accounts for approximately 60% of the total weight of the average car today.

Bucking the trend, a number of electric vehicle (EV) models have hit the market at relatively low volumes in recent years, harnessing a range of exceptionally light materials such as aluminium, magnesium and carbon fibre composites. The BMW i3, for example, featured a carbon fibre-intensive body structure, and at its launch appeared to show a new direction for vehicle design as a direct result of e-mobility.

However, once automakers begin ramping up volumes to tap the mass market, it is expected that steel will become the material of choice for several reasons.

A new twist to an old debate

The subject of steel versus aluminium is not new by any means, and suppliers in the industry have long spoken of a ‘battleground’ between the two materials fighting for a place on new platforms. Both sides have fought their corner, but Stockholm-headquartered steel giant, SSAB, believes steel has the edge when it comes to the mass market.

The supply chain is well prepared to cope with a rise in steel use, and has continued to grow over the last decade; between 2010 and 2017, global crude steel production increased by more than 250 million tonnes. As highlighted above, steel is also comparatively inexpensive, and manufacturers are well acquainted with how the material performs from a safety perspective.

Carbon composites, and aluminium to an extent, are typically more challenging to work with. While aluminium is extremely light, and helped the Ford F-150 to shed 700lbs (317kg) when transitioning away from a steel body, it can be harder to form and comes with a higher price tag. “Aluminium tears more easily than steel, so the sorts of sharp edges, creases and very tight radii that we love to craft in the design studio can sometimes be difficult for the engineering team to create in reality,” notes Wayne Burgess, Production Studio Director at Jaguar.

Many traditional manufacturers have tried to keep steel in their BEV solution because they have adapted the traditional combustion body to the electrical drivetrain

Arnaud Guerendel, Global Automotive Director at SSAB, highlights that material trends within the automotive mass market are unlikely to change despite the disruption of EVs. “Most new cars in production today are based upon a steel solution,” he says. “If a manufacturer is to build more than four or five million cars a year, it must be efficient both industrially and in terms of cost.”

While SSAB has cemented its automotive business on orders from established global automakers over the years, there are the demands of new entrants to consider, many of which have the concept of ‘future mobility’ in mind. “A new generation of OEMs has developed around battery electric propulsion, and they have been building their cars almost fully from aluminium because, at these low volumes, they can build whatever they want,” observes Guerendel. “There are two sides: the big players that need massive efficiency from their materials; and the new players that disrupt with a completely different approach to material assembly.”

There are varying schools of thought when it comes to producing electric vehicles. While some platforms are developed from the ground up to house electric powertrains, others adapt an existing platform. The Volkswagen e-Golf, for example, is based on the same platform as the original Golf. The Renault Zoe EV shares the Clio platform, and the Kia Soul EV was originally launched with gasoline and diesel engines. “Many traditional manufacturers have tried to keep steel in their BEV solution because they have adapted the traditional combustion body to the electrical drivetrain,” observes Guerendel.

Mass market means steel

While high volume production is not certain to push OEMs toward one material and away from another – without considering the impact of import tariffs – the factor of cost efficiency does become more pressing.

With a low volume vehicle in the premium segment, higher material costs can be offset by savings made elsewhere in the vehicle, or absorbed by a higher retail price. The same can be said for EVs across any segment, sales of which remain low in most markets aside from China and Norway, and a forecourt price well above a comparable combustion engine equivalent. Guerendel is confident that automakers old and new will naturally look to more cost effective solutions once volumes increase; Bloomberg’s latest electric vehicle outlook projects global new EV sales to grow from 1.1 million units in 2017 to 30 million in 2030.

As an example, SSAB has been approached by one EV brand, with annual volumes of around 500,000 units per year, to benchmark the price differential between switching from an aluminium body to advanced high-strength steel. Guerendel suggests that if this automaker began producing more than one million units annually, and the price of an aluminium body over steel reaches between US$1,000 and US$1,500, “the decision will be made to convert from aluminium to steel in the economic interests of the company.” He adds that: “This phenomenon is also present with other more traditional brands that have been successful with aluminium-based models. If you look a little deeper into what they are doing today, many are transferring to steel.”

If a manufacturer is to build more than four or five million cars a year, it must be efficient both industrially and in terms of cost

This trend can be seen with both traditional combustion engine vehicles and EVs. In contrast to the Tesla Model S, which utilised an aluminium intensive body and chassis, the ‘mass market’-oriented Model 3 uses primarily mild, high-strength and ultra-high strength grades of steel. Audi has gradually upped its steel content in the previously aluminium-intensive A8 platform; in the 2009 model, aluminium accounted for 92% of the materials used in the body structure, with steel making up 8%. In the 2018 model, aluminium fell to 58%, while steel rose to 40.5%.

It is worth highlighting that the argument is not that steel will become the only material used in all new vehicles, rather that it is likely to take the lion’s share of overall materials in high volume platforms. The body-in-white (BIW), for instance, which is the heaviest single structure of a vehicle, will likely be made from advanced high-strength steel. Body panels could still be made from aluminium or a polymer, and the powertrain could consist of a multi-material mix. “The truth is in the perfect combination of material and function,” says Guerendel. “But steel is primarily favoured for high volume production, and studies have demonstrated that in terms of cost efficiency for mass production, around 85% of cars use steel and will continue to use steel.”

There are also EV-specific opportunities. Protective housings for the battery pack could be formed from steel, for example, and SSAB is currently developing solutions to support “cheaper and safer solutions at almost the same weight compared to aluminium or other materials.” Given the location and weight of EV batteries, Guerendel also expects the architecture of the chassis and body to change dramatically, bringing in new grades of steel.

‘A massive transfer from aluminium to steel’

In the premium segment, where price is slightly less pertinent, OEMs can afford to produce vehicles with more exotic materials because the higher margin can absorb the hit. Looking ahead, players that have so far utilised aluminium or carbon fibre bodies to unlock the most significant weight savings may switch to steel as demand for EVs increases.

“If Tesla, for example, begins producing around three million cars a year and the cost of an aluminium solution becomes too high, someone will question the cost efficiency,” muses Guerendel. Earlier in July, Tesla announced that it had signed an agreement to set up its first factory in China, the world’s leading market for new EV sales, with a planned capacity of 500,000 units per year. The company’s existing Fremont factory in California is also reported to have annual capacity of 500,000 units.

Axel Schmidt, Global Automotive Lead at Accenture, notes that there will likely be a near-even mix between traditional and battery electric powertrains within the next decade or so. “If current projections hold true, it seems realistic to presume that by 2030 there will be a 35-35-30 split between new diesel, gasoline, and electric cars sold in Europe respectively,” he commented. How this trend impacts material selection for upcoming EV platforms remains to be seen, but as Guerendel concludes: “I expect that you will see a massive transfer from aluminium to steel in future.”

This article appeared in the Q4 2018 issue of M:bility | Magazine. Follow this link to download the full issue

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