Oslo, 2 July 2002:
Hydro Aluminium has developed an all aluminium engine block for a new high volume diesel engine. On the basis of a serial production order for this engine block and with prospects for new orders for aluminium blocks, the board of Norsk Hydro has approved a major expansion of VAW alucast, Dillingen. Hydro will invest up to € 76 million in a new production line for the production of aluminium blocks.
The technology is developed through the former VAW Casting Business Unit in partnership with a renowned European car maker over the last few years.
Up until today, mainly petrol engines could be made from aluminium. Blocks for high performance diesel engines must sustain high temeperatures and up to three times the pressure of traditional petrol engines. With this new development also high-end diesel engines can be produced from aluminium.
The development, which makes production of high performance diesel blocks feasible, contains several proprietary elements. The technology offers advantages to the automotive industry such as integration of features that were previously not possible to integrate in the block as well as
substantial weight savings of 30-50 kilo per block.
With diesel rapidly approaching 50 per cent of the market for new car registrations in Europe, this development is important for increased fuel efficiency, for recyclability as well as for the future growth in usage of aluminium in cars.
The capability to produce blocks both for diesel engines, both in-line and in V configuration, opens up an extended market for Hydro Aluminium Automotive. The investment decision in Dillingen, Germany, is based on a serial production order, and satisfies Hydro's requirements for return on investment. The project will start this fall, and production will begin during 2004. Capacity in the new facility will be 350,000 engine blocks per year. When in operation, the new production line will establish 260 new jobs in Saarland, adding to the existing 500 employees.
Hydro Aluminium is the leading aluminium company in Europe, and one of the top three integrated companies globally. After the acquisition earlier this year of the German company VAW aluminium AG, Hydro is global leader in aluminium solutions for the automotive industry. Hydro Aluminium Automotive, which is one business sector within Hydro Aluminium, has an annual turnover of approximately € 1 billion and more than 6000 employees worldwide.
Norsk Hydro is a leading Norway based industrial group, its core business areas being Hydro Oil & Energy, Hydro Agri and Hydro Aluminium. The group has more than 50,000 employees in nearly 60 countries. In 2001, operating revenues totalled more than € 20 billion.