- Alcoa (NYSE:AA) shares hit a 52-week high today amid reports that Ford's (NYSE:F) lightweight Fusion concept car could provide a profound impact on aluminum demand and aluminum producers’ profits.
- The prototype unveiled Tuesday is ~800 pounds, or 25%, lighter than the regular Fusion model due to increased use of aluminum; Ford isn't selling the car for now, in part because the lighter materials are more expensive, but Sterne Agee says the vehicle confirms its "thesis of the automotive industry moving down an aluminum adoption curve beyond expectations."
- Given the momentum of automotive aluminum announcements over the last six months, Sterne Agee believes industry estimates for ~1.2M tons of automotive aluminum sheet usage by 2025 - as well as Alcoa's $1.3B revenue assumption for 2018 - are "very conservative."