Bao Steel-NSC/Arcerol Automotive Steel Sheets (BNA), a joint company controlled by Bao Steel, Nippon Steel and Arcerol Mittal in China, is expected to keep full operation after September when Japanese automakers are aggressively raising car output as recovery from the disaster of the Great North Japan Earthquake. Japanese automakers plan to increase the output in the last half of CY2011. Chinese car output growth is slowing down but forecasted to increase by around 4% in CY2011 from CY2010. BNA tries to meet the increasing orders for high quality steel sheet by productivity improvement.
Car production in China decreased for April-May from a year earlier. The market slowed down after the governmental incentive program ceased at the end of 2010 while was impacted by Great North Japan Earthquake. The car production rebounded in June and July bur Mr. Seiji Hosokai, vice president of BNA, said car sales in China are leveling off along the government’s economic controls, especially for Chinese local car makers’ vehicles and commercial cars. BNA adjusted the production for April-June while returned to full operation at near 200,000 tonnes per month in and after July. Car production in China is forecasted to total around 19 million cars in CY2011. Japanese automakers are likely to increase their output largely in 2H F2011 to cover temporary output down in 1H. The production share of Japanese automakers lowered to 15% for passenger car in May while rebounded to around 23% in August. BNA’ output is expected to increase since Japanese automakers are actively using galvanizing alloy steel sheet and increasing adoption of local materials. BNA expects the production slightly increases in CY2011 from CY2010 and examines productive capacity expansion for potential demand growth in the future.