Aluminum Parts Gravity Die Casting Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Aluminum Parts Gravity Die Casting Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The aluminum parts gravity die casting market was valued at USD 5858.32 million in 2021, and it is expected to reach USD 7770.51 million in 2027, registering a CAGR of 4.82% during the forecast period (2022 - 2027).

During the COVID-19 outbreak in 2020, the entire supply chain of the automotive industry was significantly impacted. The OEMs struggled to keep their operations going. However, as the lockdowns and restrictions were relaxed, the automotive industry and the aluminum parts gravity die casting market regained their momentum.

The market is largely driven by supply chain complexities in the die casting industry, the expanding automotive market, increasing penetration of die casting parts in industrial machinery, the growing constructional sector, and employing aluminum castings in the electrical and electronics sector.

Gravity die casting is one of the oldest methods of die casting. This die casting process is used for producing accurately dimensioned, sharply defined, and smooth or textured-surface metal parts. The main advantage of gravity die casting is its high speed of production.

The CAFÉ standards and EPA policies to cut down automobile emissions and increase fuel efficiency are driving the automakers to reduce the weight of automobiles by employing lightweight metals. Subsequently, employing die-cast parts as a weight reduction strategy is acting as a major driver for the former market in the automotive segment.

The automobile regulatory frameworks in Europe and North America have been instrumental in creating a sustainable environment in the automobile industry. The latest regulatory framework, Euro 6, which was introduced in 2011 and came into effect from September 2014 onward, changed the regulatory standards that have been crucial in determining the dynamics of the automotive market in the region. Since 2013, the EC (European Commission), along with EEA/EMEP, has been maintaining the record of emission performance standards for each new vehicle registered in Europe.

The emission regulations bind the automotive manufacturers together. The freight companies and fleet owners are rapidly moving toward incorporating more technologies that are expected to reduce the average emission rate. Thereby, a need to reduce vehicle weight for lowering emission levels has greatly encouraged the employment of die-cast parts in vehicles.

Automobile manufacturers are always looking for ways to make vehicle components more efficient to improve the fuel efficiency of vehicles and reduce carbon emissions. Lightweight construction, using efficient and cost-optimized aluminum die-casted parts, plays a key role in achieving this goal. Companies like Nemak are focusing on the ‘lightweight’ trend and introducing electric vehicle products (manufactured by using the HPDC process) into the automotive industry. Such aforementioned environmental policies are expected to drive the demand in the market.

Asia-Pacific is the largest automotive market in the world due to the presence of key economies like India, China, etc., and active engagements of key players and several government initiatives, which are expected to further contribute to the development of the aluminum gravity die casting market. China is the world's leading exporter of aluminum and aluminum products. In 2019, China's exports of aluminum were valued at USD 26 billion, almost USD 10 billion more than Germany, the second-largest exporter.

The Asia-Pacific region has also recovered quickly from the impact of the COVID-19 pandemic due to the high demand for Chinese products across the world. With growing manufacturing capabilities, the demand in the aluminum parts gravity die casting market is expected to grow during the forecast period.

In FY2020, aluminum production in India stood at 3.6MT. India stands as the second-largest foundry industry that produces castings in the world. Foundries in India are capable of producing gravity die casting products that serve a wide range of applications conforming to international standards.The government’s focus on ‘Make in India’, developing the automotive industry, and the stringent emission norms is driving the market growth. In FY2019, 6.7 lakh passenger vehicles were exported from India. Companies such as Hyundai, Kia, Maruti SuzUnited Kingdomi, and Volkswagen are exporting Indian-made cars to the African region instead of setting up their factories there because of low-cost manufacturing and availability of parts suppliers in India. All these factors contribute to the overall development of the Asia-Pacific aluminum parts gravity die casting market during the forecast period.

The market for aluminum parts gravity die casting is fragmented in nature, with the presence of many regional small-medium scale players across several countries, as well as large-scale/international players.

Key players have also expanded their operations globally through various mergers, expansions, partnerships, joint ventures, and acquisitions. For instance, in January 2019, Endurance Technologies Ltd acquired Italy-based aluminum die casting company, Fonpresmetal Gap SpA, for EUR 8.16 million. The Endurance Group in Europe has nine manufacturing plants at present, of which six are in Italy and three in Germany.

These key players are focusing their revenues on R&D to come up with better production processes and alloys. This strategy may assist in the production of premium-quality die-cast parts for the global automotive and industrial sectors.

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