Higher Prices Could Affect More Than Wheel Makers: MEMA

(Akron/Tire Review) According to the Motor and Equipment Manufacturers Association (MEMA), aluminium prices are increasing dramatically and will be nearly double those of 2002 by the end of this year if 2005 price growth repeats. Based on annual averages, mean daily price volatility has increased from 2.31 per cent in 2002 to 6.93 per cent in 2005.

“Since 2002, the increase in aluminium prices has been the source of bumps in the road for major and minor manufacturers alike, including issues with Chevrolet Corvette wheels most recently,” said Richard Anderson, MEMA’s senior market research analyst. “Looking to the future, though, should aluminium prices continue to increase, problems will not be limited to wheel manufacturers. Many of today’s manufacturers use aluminium for motor components like the engine block, heads and more. In addition, brake callipers, entire suspensions and even bodies/chassis components themselves could suffer from increased aluminium pricing.”

Demand for recycled aluminium could increase, but even that material is under price pressure, Anderson noted.