Steel Insights, July 2016
At Essar Steel India, one of India’s leading integrated steel producers with an annual production capability of 10 mtpa and supported by a 20 mtpa pellet facility, automotive steel constitutes 10 percent of its total volume. The company is a globally approved supplier for major auto-makers and has designed new-generation crash-resistant, high-strength cold rolled, and dentresistant steels apart from high-strength hot rolled steel for long members. Stringent environmental and safety standards have compelled automotive manufacturers to reduce the weight of their vehicles. Advanced high strength steel is, therefore, being developed which requires basic changes in the steel manufacturing process. But, all steel manufacturers have been able to implement these process changes to meet the requirements of the automotive steel segment, Vikram Amin, Executive Director, Strategy & Business Development, Essar Steel India, tells Steel Insights. Excerpts from an interview:
What is the overall market for automotive steel in India in volume and value terms? Is this figure rising considering the current market scenario?
The volume of the flat steel market in India is approximately 33 million tons (mt). Of this, automotive constitutes approximately 20 percent of total requirements from all product categories, be it HR, CRCA, GI or plates. Flat steel volumes in the auto sector are expected to grow at a rate of 12% CAGR over the next 10 years.
What are the key trends in automotive steel manufacturing?
Steel remains the material of choice because of its inherent strength, formability, joinability, recyclability and cost. The key drivers of development of automotive grade steel are environment/safety, cost reduction and comfort. Stringent environmental norms and safety standards have compelled automotive manufacturers to reduce the weight of their vehicles. Advanced high strength steel is, therefore, being developed. Developing high strength steel requires basic changes in the steel manufacturing process. All steel manufacturers have been able to implement these process changes to meet the requirements of the automotive steel segment.
What are the key concerns/challenges in manufacturing automotive steel since auto makers are stressing on lightness of their vehicles?
New emission norms for end-use products mean new product development. The ongoing research, in steel industries especially, to meet environmental standards will bring in lot of technological changes in the next few years. There is a growing demand for lighter and stronger products. The steel industry is therefore gearing up to meet the stringent requirements of the automotive industry.
We see challenges arising from global climate change. The steel industry needs to limit carbon dioxide emissions and we need lighter vehicles to so that tailpipe emissions are minimised. Therefore, alternative materials, like plastics and aluminium, will challenge the steel industry. However, if one were to do a lifecycle analysis, steel has lower emissions than aluminium.
It is very important for steel industries have R&D capabilities to successfully serve their auto customers. It is imperative that the industry comes up with better quality products, especially products that have high strength and also weigh less. Collaborative development with major steel industries in the field of product innovation is the key to countering some of the challenges.
Where does automotive steel find application in auto manufacturing (other than, of course, the vehicle’s body)?
Automotive steel constitutes 65-70 percent of total vehicle weight. The steel finds its applications in what is known as “body in white” (or BIW, which comprises of passenger compartmental frame, crossside beams, roof structures and front-end), chassis, suspension systems, automotive precision tubes, wheels, steering brakes, closures/fenders, interiors and powertrain.
At Essar Steel, what is the share of automotive steel in your portfolio of products and what are you doing in terms of upgrading technology, etc?
Approximately, 10 percent of our total volume constitutes automotive products. However, if you look at our auto steel products like CRCA & HRPO, their share is about 70 percent in the total volume.
At Essar Steel, we use the latest technology for steel-making, casting, hot rolling and cold rolling to produce steel fit for the automotive sector. Technology has helped us to develop and customise steel products that cater to the various needs of automotive customers. We work with the automotive sector on a continuous basis to develop cutting-edge products and have successfully developed and commercialized hot rolled high strength steel that has a strength level of up to 800 MPa.
We have also successfully developed hot forming grades of steel, which are used for structural components of passenger vehicles. Hot forming grades have wide application in automotive precision tubes. Essar Steel has set up Steel Service Centres at major automotive hubs to facilitate just-in-time delivery. The service centres are equipped to process high strength steel (up to a strength level of 800 MPa). In fact, ours are the only service centres in India to be able to do so.
Essar Steel has been a pioneer in the development of niche products. We have the only steel mill with hot skin passing facility that makes hot rolled pickled and oiled (HRPO) products, which are best suited for automotive applications.
Does India export automotive steel? What is the share and which are the key markets? How big is the export market?
India currently caters only to domestic requirement of automotive grade steel. This is because the domestic market is way too big and is also growing rapidly.
What is the global scenario like with regard to automotive steel? Where does China stand in the scheme of things?
The globally automotive steel market is matured and saturated. Growth, therefore, is happening in emerging markets. While some large Chinese companies have made inroads into the auto steel market, Chinese steel is not the first choice in auto applications.
In which areas of automotive steel has the company brought in innovation?
Transformation through innovation is the philosophy that Essar Steel lives by. This ensures that it adopts the most costeffective steel manufacturing processes, with optimum production levels and a focus on developing value-added grades, products and solutions.
Essar Steel is a pioneer in introducing high-strength products in automotive and other allied industries. In the automotive segment, Essar Steel is a globally approved supplier for major auto-makers. It has designed new-generation crash resistant steel, high-strength cold rolled steel (of up to 440 MPa in strength) and dent-resistant steels. High-strength hot rolled steel (of up to 800 MPa in strength) for long members were developed for the first time and used by major auto-makers, giving them substantial reduction of 17-20 percent in weight.
The latest addition to our product range are hot forming grades of steel for structural members of passenger vehicles. Some of the recent contributions include indigenous development of ballistic steel, soft magnetic steel for the nuclear energy sector and ultrahigh tough steels for warships.
Essar Steel has developed various newgeneration plate products, which were earlier imported, thus saving precious foreign exchange for India. These products have several applications, which include boiler and pressure vessels, Defence, yellow goods, energy, white goods, construction segments, etc. In terms of new-generation products, Essar Steel has also developed high strength structural grades with 780 MPa in quench & tempered (Q&T) condition. Other plate products include high-performance bridge steels, weather-resistant steels, Q&T wear resistant steel, corrosion-resistant plates, special alloy high-strength steel for constructions.
Source: Steel Insights, July 2016