SMM reported that Chinese manufacturers saw orders for automotive extrusions in aluminium decline in May, showed an SMM survey, likely due to the upcoming new vehicle emission standards that deterred automakers from producing while they clear inventories of models under old standards. The China VI emission standards for light- and heavy-duty vehicles are set to kick in across some certain regions from July 1.
Continued weakness in auto sales also weighed on demand for aluminium automotive extrusions. Sales and production of vehicles in China continued to decline year on year since the second half of 2018, and failed to recover this year.
Producers were pessimistic about demand in June. Lower orders for aluminium automotive extrusions in June will affect the average operating rate across industrial aluminium extrusion producers.