China Zhongwang Holdings Limited as saying that demand is increasing as carmakers use more of the lightweight metal in place of steel.

Mr Lu Changqing executive director of Zhongwang said that “Aluminum usage in cars has changed noticeably in the past year. Growth will be driven by the transportation sector.”

Aluminum producers globally are betting regulation to cut carbon emissions and improve fuel efficiency in the US and Europe will prompt carmakers to use more aluminum. Jaguar Land Rover plans to start selling its first all aluminum Range Rover SUV next month, reducing the car’s weight by 39% while Daimler AG’s Mercedes is using the metal for its EUR 93,534 SL model.

Mr Lu said that China’s industrial aluminum extrusion market will expand at least 12% this year to 4 million tonnes. Liaoning based Zhongwang announced H1 profit more than doubled after it shifted its focus to the domestic market.

China Zhongwang shares gained as much as 7.9% to HKD 3.28 and traded at HKD 3.23 in Hong Kong. The shares have gained 21% this year compared with an 8.2% increase in the benchmark Hang Seng index.

Source - Bloomberg

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