Hindalco-led Novelis to invest $365M to support North American automotive customers and reduce carbon emissions by over 1 million tons a year

13 Jan 2022 , 03:57 PM

Hindalco's Novelis is set to invest $365 million to build a highly advanced recycling center for automotive in North America. With an annual casting capacity of 240 kt of sheet ingot, Hindalco expects the facility to reduce the company’s carbon emissions by more than one million tons each year.

The new recycling facility will be built adjacent to Novelis’ existing automotive finishing plant in Guthrie, Kentucky.

“Novelis aims to be the world’s leading provider of low-carbon, sustainable aluminium solutions that advance our business, industry and society toward the benefits of a circular economy,” said Steve Fisher, President and CEO of Novelis, Inc. “Through this investment, we will continue to increase the amount of recycled content in our products, reducing our CO2 emissions and moving us closer to carbon neutrality.”

The center will enable Novelis to grow its closed-loop-recycling programs with more automotive customers in North America. Through closed-loop recycling, the company takes back the aluminium remaining after automotive parts are stamped from sheets and remakes it into the same product for new vehicle production.

Also, the center will have the capability to process aluminium from vehicles at the end of their lifecycle. Using recycled aluminium as input material requires only 5 per cent of the energy used to make primary aluminium, thus avoiding 95 per cent of the carbon emissions associated with production.

The new recycling center will be equipped with industry-leading processes and capabilities, including advanced shredding and sorting technology, as well as energy-efficient innovations to support the company’s sustainability goal to reduce energy intensity by 10 percent by 2026. Groundbreaking is scheduled for early 2022, with commissioning expected in 2024.

When fully operational, the expansion will add approximately 140 new jobs in Guthrie. This announcement is on the heels of Novelis’ October grand opening of the automotive finishing plant in Guthrie, which currently employs 150 people and will grow to 190 over the next two years.

On Sensex, Hindalco closed at Rs507.10 per piece up by 1.9%. The stock was near the day's high of Rs508.95 per piece.