Kobe Steel Ltd. has started commercial production at its aluminum forging development at Suzhou, in China’s Jiangsu Province. The first phase of the Kobe Aluminum Automotive Products (China) Co. Ltd. (KAAP China) project was completed earlier this year, and the second phase announced in December 2011 is scheduled for completion in March 2013.
KAAP China was established in 2010 by Kobe Steel and two Japanese trading companies: Kobe holds a 60% stake; Mitsui & Co. Ltd. holds 25%, and Toyota Tsusho Corp. holds 15%. The same partners operate Kobe Aluminum Automotive Products LLC in Bowling Green, KY. Kobe Steel also produces aluminum forgings for automotive suspensions at its Daian Plant in Inabe, Mie Prefecture, Japan.
The first phase of the KAAP China investment is estimated now at $32 million, and the second phase is estimated at $57 million. The entire development is projected now at about $89 million.
KAAP China produces aluminum forgings for automotive suspensions. The operation includes a 6,300-metric-ton mechanical forging press and heat-treating equipment for finished parts. The second phase will duplicate the forging and heat-treating process lines, and also will include an aluminum melting furnace, billet casting systems, and a billet heating line.
When construction is completed for the second phase next spring, production capacity is anticipated to double and the upstream operations will begin.
KAAP China aims to supply an anticipated increase in demand for automotive parts in China, including parts for lighter vehicles that meet stricter fuel consumption regulations. Aluminum suspensions are seen as a critical element of this developing market, including Japanese, U.S. and European automakers.