Mega-Trends: Shifting Gears in the Auto Industry

By: Jim Burstein, President – Admiral Metals

 

There is little more sacred in American culture than our love affair with the automobile. It blossomed as we shifted to a suburban society after WWII when, for the first time, many families could afford a car to get from one place to another. Despite increasing traffic, deteriorating roads, and high gas prices, we still love and depend on our cars more than ever. Today, 70% of us drive to work daily and the two or three car household seems here to stay.

 

The United States has more vehicles on the road than licensed drivers and more cars than any other country, approximately 254 million in 2009 according to the Bureau of Transportation. Global consumption of passenger vehicles is up from recent years but it’s not the US that is driving that demand. China is rapidly developing its own love affair with the automobile.

 

 

China now has nearly 70 million cars on the road. Fifteen years ago China had one car for every 522 people. Now that figure is one car for every 21 people. While that is incredible growth to date from China, the US still has one car for every 1.25 people. This means that there are about 17 times more cars per 1,000 people in the US than in China in spite of the huge growth there in the last 15 years. As that consumption gap closes over the next ten years, the accelerating demand for vehicles to satisfy China’s raging appetite will surely be astounding.

 

These eye-popping statistics reveal opportunities for the metals industry which is at the heart of automotive production. On average, every car produced today is comprised of 2,400 pounds of steel, 327 pounds of aluminum and 55 pounds of copper. Electric and fuel cell cars of the future will also use more aluminum and copper per vehicle than ever before. Multiplied by the future demand for new vehicles just for China and the numbers are staggering. From our perspective, this is a growing market opportunity.

 

These are the kinds of global and industry trends we monitor at Admiral Metals as we search for the types of opportunities that help us and our customers maintain long-term growth. Its part of the reason we’re still going strong after 60 years and why we hope to be serving you for many more years to come.

Wishing you the very best in business,

 

Jim Burstein

 

bursteinj@admiralmetals.com

 

Fact – The automobile is the most recycled consumer product in the world today.

IBM Business Partner