Novelis, a US aluminum rolled products producer and recycler, expects its new $300 million automotive aluminum sheet manufacturing plant in Guthrie, Kentucky, to be in production in mid-2020, a spokesman for the company said Monday.
Mike Touhill said that construction is "well underway" on the facility with an annual nameplate capacity of 200,000 mt.
The Atlanta, Georgia-based company, which is shifting a good portion of its portfolio to the automotive market, will operate heat treatment and pre-treatment lines at Guthrie that prepare aluminum for use in vehicle parts.
Altogether, Novelis shipped 889,565 st of aluminum during the second quarter of its 2019 fiscal year, up 1% from 884,053 st a year earlier.
During a Friday conference call with analysts, Novelis president and CEO Steve Fisher said that while the automotive market remains strong, he is keeping a close eye on China, where consumers are becoming more cautious about buying new vehicles, perhaps because they fear a trade war between the US and China.
In North American and European markets, Novelis is seeing a consumer trend in favor of larger vehicles such as SUVs and pickup trucks that incorporate higher amounts of aluminum.
Fisher also remains bullish on the use of aluminum in packaging, such as aluminum cans. "Aluminum remains the packaging choice for many brands," he said, and the market is likely to grow in the coming years.
Novelis' pending approximately $2.6 billion acquisition of US aluminum rolled products maker Aleris continues to go through the regulatory process, but is on track to close in nine to 15 months following Novelis' July 26 announcement, Fisher said.
To help finance the transaction, Novelis last week entered into a commitment with a group of banks to provide up to $775 million of an incremental term loan with a five-year maturity, and up to a $1.5 billion short-term bridge loan with a one-year maturity.
