EGA to increase supply of aluminium to German car maker BMW

The new agreement between the two will continue until 2022

Emirates Global Aluminium is planning to significantly increase its supply of UAE-made aluminium to BMW. Courtesy: Emirates Global Aluminium

Emirates Global Aluminium, the UAE’s biggest industrial company outside the oil and gas sector, is planning to significantly increase supply of aluminium to German car maker BMW, it said on Tuesday.

EGA has been supplying aluminum to BMW since 2013 to be used in engines and the new agreement will extend the pair's agreement until 2022.

“The BMW Group has high standards for the quality of metal as well as for sustainability and social responsibility. We are proud that we have maintained BMW Group’s trust over the past six years and that our relationship will continue into the next decade,” EGA’s managing director and chief executive, Abdulla Kalban, said.

Europe accounts for approximately a quarter of EGA's worldwide sales of aluminium with one-third going to the car industry.

EGA, which is jointly owned by Abu Dhabi's strategic investment arm, Mubadala Investment Company, and the Investment Corporation of Dubai, recently announced its new refinery at Al Taweelah is set to attain full production next year, providing 40 per cent of the alumina required for its production.

The $3.3 billion (Dh12.1bn) refinery will start producing two million tonnes of alumina per year in 2020, doubling its capacity from a total of one million tonnes it is set to produce by the end of 2019.

EGA’s aluminium is primarily used in the construction, automotive, packaging, aerospace and electronics industries. In 2018, the company produced a record 2.6 million tonnes of cast metal and made a profit of Dh1.2bn on revenue of Dh23.5bn.

Revenue increased by 15 per cent, which the company said was driven by higher sales volumes, increased aluminium prices and an increase in the amount of value-added products sold. More than 80 per cent of its production is in value-added products, which is one of the highest rates of any aluminium producers in the world, the company said.

EGA has more than 350 customers in about 60 countries, with the majority of its sales going to South-East Asia, followed by the US and Europe. The domestic market in the UAE accounts for about 10 per cent of EGA's sales.