Investment grows VAMA’s advanced automotive steel solutions capacity and ability to serve Chinese auto market
February 1st, 2021
Valin ArcelorMittal Automotive (‘VAMA’), a 50/50 joint venture between ArcelorMittal, the world’s leading steel company and Valin Steel, a leading Chinese steelmaker, announced an exciting expansion of its facilities in Loudi, Hunan, on Feburary 1st. Through the addition of a new innovative coating line which will enable the production of highly corrosion-resistant steel. The coating line, which will come onstream by July 2022, will increase VAMA’s capacity to produce high-quality, high-strength steels for the Chinese automotive industry by 450,000 tonnes a year, to 2 million tonnes.
The importance of this event was emphasized by the presence of the Hunan Leadership with Party Secretary Mr. Xu Dazhe and governor of Hunan Mr. Mao Weiming; the local Loudi government strongly supporting VAMA sent a delegation under the leadership of party secretary Mr. Liu Fei. The whole ceremony was witnessed as well by both shareholders: ArcelorMittal chairman & CEO Mr. Lakshmi Mittal, ArcelorMittal EVP Mr. Brian Aranha, ArcelorMittal EVP Mr. Bradley Davey, ArcelorMittal China CEO Mr. Sanjay Sharma, Valin Group Chairman Cao Zhiqiang, Valin Group CEO Mr Yi Zuo, Valin Lianyuan Party Secretary Mr. Xiao Zunhu and VAMA chairman Mr. Cheng Peixiang.
Since its inauguration in 2014, with the strong support of both local Loudi government and Hunan government, VAMA has grown into a leading supplier of advanced steel solutions for the Chinese automotive market. VAMA’s innovative, market-leading product range of lightweight steels is actively contributing to Chinese auto manufacturers efforts to meet challenging CO2 reduction targets, while simultaneously enhancing vehicle strength and safety. Its press hardened steel, used for safety parts in the body-in-white, is the strongest steel available on the Chinese market and can be found in almost every car produced in China. Thanks to strong recognition from its customers for its dedicated service, innovative product offer and high-quality standards, VAMA has been able to expand rapidly over the past six years becoming one of the leading suppliers to Chinese OEMs including NEV carmakers. VAMA’s success in bringing innovative solutions was recently emphasized when it received the innovation award from NEVC, a leading New Energy Vehicle research association.
The new coating line will support VAMA’s ambition to become one of the largest suppliers to China’s automotive market. China is already the world’s largest automotive market, with forecasts indicating anticipated annual growth of at least 6% in the coming decade. Alongside the anticipated volume growth, the sector is also focused on further reducing its environmental footprint and transitioning to electric vehicles. VAMA’s expansion will feature the most recently developed high strength steel grades and a new type of coating, allowing car makers to reach new quality standards. The new type of coating has been designed to allow for better corrosion-resistance of both inner and outer panels in the body-in-white. With these new products VAMA will also be positioned to support China’s automotive manufacturers transition to electric vehicles through the introduction of ArcelorMittal’s world leading S-in Motion steel solutions for electric vehicles, to implement the important announcement of General Secretary Xi Jinping on "achieve carbon summit and realize carbon neutralization", make great contributions to the implementation of Hunan’s “Constructing Three Hubs and Making Four-pronged Achievements” strategy.
Mr. Mittal said: “Today’s announcement is an important development for VAMA. It builds on the impressive progress the company has achieved in recent years, and further develops its ability to serve its customer base with high quality steel solutions.” He also mentioned,” The Chinese automotive market is growing rapidly, with customers’ quality expectations increasing as they seek suppliers which can support their transition to low-emissions vehicles. As the world’s leading supplier of advanced steel applications to the automotive market ArcelorMittal, through VAMA, is well placed to support this transition in China. I would like to thank the Hunan government for its ongoing support, along with our friends and partners at Hunan Valin. VAMA’s inherent strength is built upon this partnership, and the investment we are announcing today has been made possible through our combined efforts.”
Mr. Cao Zhiqiang, Chairman and party secretary of Valin Steel, expressed his sincere appreciation on behalf of Valin Group to the leaders at all levels who have been concerned about and supported the growth of Valin and VAMA for a long time, and he mentioned that VAMA Phase II project aims at the world's cutting-edge technology of high-strength and light-weighted automotive sheet, to build a new continuous hot-dip galvanizing line with 450 kt capacity per annum, which is a major industrial project to develop "three hubs". Hunan CPC Committee and Hunan provincial government attach significant importance to the project, Loudi CPC Committee and Loudi municipal government strongly support it, and both shareholders actively advance it. Today, the project kicks off construction as planned, which is just in time.