Staff Research

Study

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 22

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Office of Industries

U.S. International Trade Commission

Commercialization of New Manufacturing

Processes for Materials

April 1998

Publication 3100

The views expressed in this staff study are those of the Office of Industries, U.S. International

Trade Commission. They are not necessarily the views of the U.S. International Trade Commission

or any of the Commissioners.
U.S. International Trade Commission

Office of Industries

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Vern Simpson

Director of Industries

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David Lundy, Project Leader

Contributing Authors

Vincent DeSapio

Elizabeth Howlett

Robert Kaproth

Susan Lusi

Cheryl Qassis

Karl Tsuji

Charles Yost

With assistance from:

Diane Bennett

Zema Tucker

Under the direction of:

Karen Laney-Cummings, Chief

Industrial Minerals and Nonferrous Metals Branch

Larry Brookhart, Chief

Minerals, Metals, Machinery, and Miscellaneous Manufactures Division

Address inquires to:

Director of Industries

U.S. International Trade Commission

500 E St., SW

Washington, DC 20436

Fax: 202-205-3161
i

Visit the USITC’s Internet Server to find more information

about the agency and to download this and other USITC reports.

http://www.usitc.gov or ftp://usitc.gov

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PREFACE

The U.S. International Trade Commission (USITC) Office of Industries has researched the

commercialization of new manufacturing processes for materials since 1993. The National

Critical Technologies Panel, appointed by the President’s Office of Science and

Technology, and the Council on Competitiveness, an association of private-sector chief

executives representing business, higher education, and labor, identified new processing

technologies as crucial to improving competitiveness of U.S. industries. The results of the

USITC research on developments related to these technologies have been published

periodically as individual articles in the Industry, Trade, and Technology Review (ITTR),

a quarterly staff publication of the Office of Industries. These articles are reprinted in this

staff research study, and, in most cases, include a section describing recent developments.

An overview of the research objectives and executive summary of the key findings derived

from the research are provided at the outset. In addition, several other published ITTR

articles covering materials technology are included to provide an understanding of the scope

of advanced technologies that have potential future implications for U.S. industrial

competitiveness. 

The information and analysis in this staff study are for the purpose of this report only.

Nothing in this report should be construed to indicate how the Commission would find in

an investigation conducted under other statutory authority. For additional information,

please direct inquiries to David Lundy, Project Leader at (202) 205-3439 or electronic mail

at lundy@usitc.gov.
iii

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CONTENTS

Preface ...................................................... i

Overview and executive summary ................................... 1

Part I: New manufacturing processes for materials .................... 5

Factors affecting the commercialization of new manufacturing

processes for materials (Karl Tsuji, 202-205-3434) ............ 7

Incentives for developing and adopting NMPM .................... 9

Confronting the barriers to commercializing NMPM ................ 11

Outlook: Further actions for effective commercialization of NMPM ... 18

New manufacturing processes for materials: Government 

policies and programs towards commercialization

(Dana Abrahamson and Cheryl Badra Qassis, 202-205-3436) ..... 23

Shifts in government focus .................................... 24

Framework for government involvement ......................... 26

Outlook for increased government involvement .................... 29

Recent developments ........................................ 33

Alternate materials in the U.S. automobile industry promote

development of joining and bonding technology

(Susan Lusi, 202-205-2334) ................................ 37

Joining and bonding ......................................... 41

Outlook ................................................... 46

Thin-slab casting/flat-rolling: New technology to benefit U.S. 

steel industry (Charles Yost, 202-205-3432) .................. 49

Thin-slab casting process ..................................... 51

Commercialization of thin-slab processes ........................ 52

Factors aiding or hindering adoption of thin-slab casting ............ 54

Competitive effect of process commercialization and outlook ........ 57

Recent developments ........................................ 59

Sol-gel: Industry seeks to commercialize energy-saving

technology for existing and emerging markets

(Vincent DeSapio, 202-205-3435) ........................... 63

The sol-gel process .......................................... 64

Joint government/industry support of sol-gel projects ............... 72

Outlook for commercial production ............................. 77

Recent developments ........................................ 78

Direct ironmaking: A case study in government and industry 
iv

cooperation to commercialize new manufacturing

processes for materials (Cheryl Badra Qassis, 202-205-3436) .... 83

DOE-AISI pilot project background ............................. 86

Management and funding ..................................... 87

Foreign government support of competing technologies ............. 88

Research goals and results .................................... 92

Conclusions ................................................ 94

Recent developments ........................................ 95

Part II: Other materials technology research .......................... 103

Thermoplastic elastomers in the auto industry: Increasing use and

the potential implications (Elizabeth Howlett, 202-205-3365) .... 105

Processing advantages of TPEs ................................ 109

Applications in the auto industry ............................... 112

Outlook for TPE producers ................................... 114

Conclusions ................................................ 117

U.S. bicycle industry creates innovative products using 

metal matrix composites (David Lundy, 202-205-3439) ......... 119

Design and material innovation by the bicycle industry .............. 120

Material alternatives ......................................... 120

U.S. bicycle market and industry structure ........................ 123

The bicycle MMC infrastructure ............................... 124

Outlook ................................................... 126

Recent developments ........................................ 127

Aluminum product development and the automotive 

industry (Charles Yost, 202-205-3432) ...................... 129

Aluminum use in the auto industry .............................. 129

Auto industry efforts to increase use of aluminum .................. 132

Automotive-aluminum industry joint ventures ..................... 134

Outlook ................................................... 138

Recent developments ........................................ 138

Advanced structural ceramics: Technical and economic 

challenges (Vincent DeSapio, 202-205-3435) .................. 143

Initiatives to reduce obstacles facing advanced ceramics ............. 149

Initiatives to improve end-user acceptance ........................ 153

Implications for U.S. competitiveness ........................... 154

Recent developments ........................................ 154

Metal matrix composites may be key to more efficient automobiles

 (David Lundy, 202-205-3439 and Robert Kaproth, 202-205-3120) . . 159

MMC attributes and applications ............................... 160

Structure of the MMC industry ................................. 161

U.S. automobile companies' strategic considerations ................ 162

Conclusion ................................................ 164

Recent Developments ........................................ 164
1Report of the National Critical Technologies Panel (Washington, DC: Office of Science and

Technology Policy), Mar. 22, 1991; U.S. Department of Commerce, Emerging Technologies: A

Survey of Technical and Economic Opportunities (Washington, DC: U.S. Department of

Commerce), Spring 1990; The Council on Competitiveness, Gaining New Ground: Technology

Priorities for America's Future (Washington, DC: The Council on Competitiveness), Mar. 1991;

and Advanced Materials in High Technology and World Class Manufacturing,) New York, NY: 

United Nations Industrial Development Organization, Mar. 1995. 

1

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OVERVIEW AND

 EXECUTIVE SUMMARY

“Critical technologies” are those that are considered crucial for the development of

innovative, high-quality, cost-competitive products. New manufacturing processes for

materials (NMPM) was identified as such a technology by the National Critical

Technologies Panel and the Council on Competitiveness during the early 1990s. Several

studies also linked the development of advanced materials and processing technologies to

the competitive posture of industries.1 

Assessing the importance of critical technologies in improving the competitiveness of U.S.

industries requires a base of information to evaluate how the United States compares with

the rest of the world in developing and adopting these technologies. The adoption of

NMPM likely will have an important effect on the ability of many U.S. industries to

compete in the global marketplace, not only industries that will use these processes but also

downstream industries that will use products made by these processes. 

The USITC Office of Industries initiated formal research on NMPM in October 1993 to

develop expertise and report periodically on emerging developments in this complex and

rapidly evolving subject area as part of a long-term research agenda. Eleven articles have

been published in the Industry, Trade, and Technology Review (ITTR), a quarterly staff

publication. Each of these articles is reprinted in this report. Except for articles published

since October 1997, updated information has been added to reflect recent developments in

the subject areas. 

The objective of the research by the USITC was to analyze the development and adoption

of new manufacturing processes related to the production of ceramic, metal, polymer,

composite, and other materials, and parts fabricated from these materials. The research

specifically attempted to develop information in the following areas:

C NMPM at various stages of development and commercialization, and factors

affecting their adoption.

C Benefits and drawbacks of using these processes in place of conventional

processes.

C Industries potentially or actually using the processes as well as industries that
2An advanced material is one that exhibits superior physical properties (e.g., strength,

strength-to-density ratios, hardness, durability, etc.) as compared with conventional materials. 

Advanced materials are also referred to as "new," "high-tech," or "high-performance" materials.

2

could use products made by the processes, and the characteristics of the

companies in these industries.

C Interactions between the entities involved in commercialization and types of

collaborations that are most often successful.

C Role of government institutions in funding research, development, and adoption of these processes.

C Extent of adoption of these processes in the United States and foreign

countries, and the factors contributing to NMPM development.

Information related to the commercialization of NMPM is not readily available from

government agencies or other sources, and published information is scattered, incomplete,

or outdated. To develop current information, USITC staff conducted extensive interviews

with industry/company representatives, including site visits. Information on foreign

companies and comparable developments among global competitors was particularly

limited, but was supplemented to some degree by technical conferences, trade journals, and

other literature as sources. Despite such limitations, a number of findings emerged from the

research. These findings are summarized below. 

The scope of NMPM 

C NMPM cover a wide assortment of materials and applications. NMPM are

used for producing conventional materials, such as steel sheet, as well as for

producing advanced materials.2 In addition, NMPM encompass processes for

adapting conventional materials to new uses, such as aluminum in automobile

frame applications.

C The intensity and ramifications of intermaterial competition are also apparent

in NMPM; for example, advances in steel processing that allow for the

production of thin, high-quality sheets have made it more difficult for aluminum

to capture certain automobile applications.

C There is a significant emphasis on processes to produce composites combining,

for example, metal and ceramic material to create a substance that has the

advantageous properties of its constituents. One such process combines

aluminum with a ceramic material; the resulting metal matrix composite

appears poised to achieve significant commercialization in automobiles. 

C Adoption of NMPM may also create the need for advancements in supporting

technologies, such as new joining methods for aluminum and composite

materials.

NMPM industries and structure
3

C The automobile sector is a major target market for the materials produced using

new processes. This is because it is one of the largest consumers of metal,

ceramic, and polymer materials, and because the industry is attempting to

improve the efficiency and minimize the environmental effects of its products.

C Foreign competitors are undertaking initiatives and efforts to commercialize

NMPM, such as direct ironmaking and processes to produce composite

materials for automobiles. This underscores the need for sustaining U.S.

efforts to ensure future competitiveness in these technologies and end-use

industries.

C The adoption of NMPM can have significant effects on the structure of

industries. For example, new processes for thin-slab casting of steel have

allowed steel sheet production by minimills, eroding the market share of

integrated steel companies.

Environmental aspects (including energy conservation)

C Environmental concerns are driving the development of many processes, from

cokeless iron-making (avoiding the pollution problems associated with coke

production) to producing automobiles that are more efficient and generate

fewer harmful emissions. Light weighting of automobiles is a major near-term

solution to increase efficiency, and producers are considering a host of new

materials or new applications of conventional materials to decrease vehicle

weight.

C Many NMPM create products that have energy savings benefits. For example,

sol-gel processing produces insulation material that can save significant energy

as compared with using conventional insulation material. 

Cooperation and collaboration

C Government involvement in research and development of materials technology

is centered in Federal laboratories. Much of this work was initially related to

the development of new materials for military systems during the Cold War era.

Since that time, new laws allow for cooperation and collaboration between labs

and private industry. Indirect government involvement is achieved by funding

technology development through agency appropriations.

C Collaboration appears to be increasing as organizations attempt to shorten

development horizons and decrease risk. Collaboration between private firms

and Federal laboratories is common. Domestic competitors in the private sector

also collaborate--Chrysler, Ford, and General Motors, for example, have

formed a partnership for developing basic technology for the next generation

of automobiles. Collaboration between U.S. and foreign companies also is

growing.

Barriers to commercialization and outlook

C The commercialization of NMPM is a formidable task, with substantial
3Articles in this study examine industry-specific technologies and do not include discussion

of the broader economic effects related to benefits and costs of government funding for private

sector research and development. In assessing impacts of commercializing innovative

technologies, articles focus specfically on industry segments or individual firms; conclusions

about broader effects on U.S. competitiveness or U.S. economic welfare overall should not be

projected from these examples.

4

economic, technical, and other barriers. Improving cooperative and

collaborative links between organizations (private companies, government, and

universities) is considered an important method of overcoming barriers. See

the first article for a detailed discussion of commercialization barriers.

C The organizations involved with NMPM have expended substantial resources

in commercialization attempts. In general, the outlook for commercialization

of these processes depends on reducing processing costs to expand market

potential, speeding the commercialization effort, and developing other

markets.

The first article in part I summarizes many of the factors generally acknowledged affecting

development and adoption of NMPM. The second article in part I examines the

Government’s expenditures on research and development programs related to technology

development, particularly in advanced materials and processing technologies. The

remaining articles provide specific case studies of a process or processes at various stages

of commercialization, from initial development to full commercialization. Articles in part

II concern developments related to other materials technology research. These articles are

focused on specific materials rather than processes, and examine the use of advanced

materials or the use of conventional materials in new applications, as well as the state of

development of these materials and competitive implications for consuming industries.3

Much of the research on these topics to date has emphasized developments in the United

States, although insights are provided on initiatives by foreign competitors to the extent

information has been obtained from industry contacts and trade sources. The longer term

research agenda of the Office of Industries, will concentrate on developing more detailed

information on the adoption of advanced technologies by global competitors. Emerging

processes and research findings will be published periodically in the quarterly report,

Industry, Trade, and Technology Review.
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PART I

NEW MANUFACTURING 

PROCESSES FOR MATERIALS
1For additional information, see Vincent DeSapio, “Sol-Gel: Industry Seeks to

Commercialize Energy-Saving Technology for Existing and Emerging Markets,” Industry, Trade,

and Technology Review, USITC, Dec. 1995, pp. 13-26.

7

Factors Affecting the Commercialization of

New Manufacturing Processes for Materials

Karl S. Tsuji

(202) 205-3434

tsuji@usitc.gov

Commercializing innovative processing technologies to enhance

industrial competitiveness has become an important consideration

among both private-sector representatives and policy makers. By

producing materials more efficiently or with superior properties,

new manufacturing processes for materials (NMPM) may boost the

competitiveness of a wide range of materials-using sectors of the

economy. The economic potential of innovative technologies, and

policy and regulatory actions promoting their commercialization,

provide significant incentives to private firms considering NMPM

as a means of keeping pace in an increasingly competitive

marketplace. However, barriers to developing and adopting

NMPM can be formidable because of economics, technical factors,

corporate culture, and regulations. This article examines how

these various factors promote or impede NMPM

commercialization; highlights the diverse efforts of private

industry, government, and academia to overcome existing barriers;

and presents both public- and private-sector recommendations to

improve the commercialization process for NMPM.

This article was originally published in the Industry, Trade, and

Technology Review (ITTR) of January 1998. ITTR articles cited

in footnotes are included in this report.

Note: A glossary of technical terms (highlighted within the

article by bold italics) appears at the end of this article.

New manufacturing processes for materials (NMPM) encompass both innovative

manufacturing processes for producing materials and advanced materials that can result

from such processes, and may be developed by a private firm, through collaborative efforts

of several firms (internal technology development), or adopted from outside sources

(external acquisition of technology). For example, sol-gel processing technologies

produce materials with specialized mechanical and thermal properties from the gel state for

various architectural and automotive applications.1 NMPM also include improved

production techniques for conventional materials, such as direct ironmaking technologies
2

 See, e.g., Cheryl Badra, “Direct Ironmaking: a Case Study in Government and Industry

Cooperation to Commercialize New Manufacturing Processes for Materials,” Industry, Trade, and

Technology Review, USITC, May 1995, pp. 31-42.

3

 See, e.g., Susan H. Lusi, “Alternative Materials in the U.S. Automotive Industry Promote

Development of Joining and Bonding Technology,” Industry, Trade, and Technology Review,

USITC, Oct. 1997, pp. 13-23.

4

 Donald F. Barnett, “Harnessing New Technologies: Key to Winning,” Steel Survival

Strategies XII, World Steel Dynamics (Paine Webber, New York, NY, June 17, 1997), pp. 213-

238.

5

 Mini-mills’ shares of long-products shipments in the U.S. steel industry in 1990 were

estimated at 83 percent for wire rods, 65 percent for merchant bars, 35 percent for cold-finished

bars, and 100 percent for light-structural shapes. By 1997, estimated mini-mill shares for these

products rose to 95 percent for wire rods, 78 percent for merchant bars, 55 percent for coldfinished bars, and 100 percent for structural shapes. Ibid.

6

 Mini-mill shares of flat-product shipments in the U.S. steel industry in 1997 were estimated

at 40 percent for plate, 30 percent for hot-rolled sheet, 10 percent for cold-rolled sheet, and 12

percent for hot-dipped galvanized sheet. With the exception of plate, mini-mills shipped only 2 to

4 percent of these products in 1990. Ibid.

7

 Richard J. Brody, Effective Partnering, a Report to Congress on Federal Technology

Partnerships, Office of Technology Policy, U.S. Department of Commerce (Washington, DC,

Apr. 1996); Executive Office of the President, Office of Science and Technology Policy, Total

Materials Cycle, the Pathway for Technology Advancement, 1995 Federal Research and

Development Program in Materials Science and Technology, a Report by the Materials

Technology Subcommittee, Committee on Civilian Industrial Technology, National Science and

(continued...)

8

that avoid the increasingly costly and hazardous coking process for steelmaking.2 NMPM

can even spur further technological advancements, as when increased use of aluminum,

polymer composites, and other specialized lightweight materials in automobile designs

prompted development of new bonding and joining technologies.3

Commercialization of innovative technologies is driven by two different, but related forces.

Where firms seek technical solutions to specific needs, market pull provides the force for

an invention to find a commercial application. For example, nylon was developed by the

DuPont Chemical Co. primarily in response to demand by hosiery manufacturers for a more

plentiful and less-costly substitute for silk. In contrast, where innovators seek suitable enduse markets for innovations, technology push provides the underlying basis from which

entirely new applications or markets are possible. DuPont successfully applied its Teflon

polymer to numerous end uses, the two most familiar being nonstick surfaces on cookware

and water-resistant but breathable material for outdoor clothing.

Advances in NMPM have revolutionized entire industries, often with dramatic impact upon

markets and international trade. In the steel industry, for example, continuous casting of

molten steel into slabs, as an alternative to the more capital- and labor-intensive

conventional ingot-casting, was first commercialized around 1960; today, more than 80

percent of all molten steel produced in the Western world is continuously cast.4 Refinement

of continuous casting and scrap-based electric-arc furnace steelmaking technologies enabled

lower-cost “mini-mills” to displace the conventional large-scale integrated mills in many

bar, rod, and light-structurals markets by the late 1980s.5 More recently, further process

improvements to continuous casting enabled mini-mill penetration into the higher valueadded plate, sheet, and coil markets, once the sole domain of the integrated mills.6

Recognizing that invention, application, and dissemination of innovative technologies have

an important role in enhancing growth in industrial productivity, both public-7 and private-
7

(...continued)

Technology Council (Washington, DC, Dec. 1995); and U.S. Congress, Office of Technology

Assessment (OTA), Innovation and Commercialization of Emerging Technologies, OTA-BPITC-165 (Washington, DC, Sept. 1995).

8

 Paul Allaire, Jack Sheinkman, and Thomas E. Everhart, Endless Frontier, Limited

Resources, U.S. R&D Policy for Competitiveness, Council on Competitiveness (Washington, DC,

Apr. 1996).

9

In assessing impacts of commercializing innovative technologies, this article focuses

specifically on industry segments for individual firms; conclusions about broader effects on U.S.

competitiveness or U.S. economic welfare overall should not be projected from these examples.

10 Ibid.

11 The changing roles of the Federal Government in encouraging U.S. industry to innovate

were reviewed in the first article in this series: Dana Abrahamson, “New Manufacturing

Processes for Materials: Government Policies and Programs Towards Commercialization,”

Industry, Trade, and Technology Review, USITC, Mar. 1995, pp. 5-13.

12 Badra, “Direct Ironmaking.”

13 The investment required for a mini-mill of minimum efficient scale (about 2 million tons

per year capacity) can be constructed for about $200 per annual ton of production capacity ($400

to $500 million per mill) for producing flat-rolled steel products. In contrast, construction of an

integrated steel mill of minimum efficient scale (3 to 6 million tons per year capacity) is estimated

to exceed $1,000 per annual ton of production capacity ($4 to $5 billion per mill). Charles Yost,

“Thin-Slab Casting/Flat-Rolling: New Technology to Benefit U.S. Steel Industry,” Industry,

(continued...)

9

sector agencies8 identified commercialization of NMPM as enhancing growth in industrial

productivity.9

Incentives for Developing and Adopting NMPM

The incentives encouraging the use of innovative materials processing to maintain longterm competitive ability arise from both outside and within the firm. The marketplace is

increasingly competitive, as the pace of technological innovation accelerates with shrinking

product life-cycles and with the rapid diffusion of capital and technology.10

Commercialization of innovative technologies is also encouraged by government policy and

regulatory changes. Since the 1980s, the Federal Government’s role in strengthening the

nation’s technology development has evolved from a customer relationship toward a

partnership with the private sector. Some important actions reflecting this shift include a

formalized Federal policy that actively promotes transfer of government-funded innovations

from Federal agencies to the private sector; changes to patent regulations to allow industrial

partners exclusive ownership of patentable government-funded innovations; and changes

in antitrust regulations to allow for collaboration on pre-competitive research and

development (R&D).11

A firm’s primary consideration in developing and adopting innovative technologies is their

potential to enhance corporate economic performance. For example, numerous process

technology improvements, taken together, have enabled steelmakers to reduce their

operating costs and improve product quality (table 1). Other innovations, such as cokeless

ironmaking technologies and conversion of furnace dusts and rolling-mill sludges into pig

iron,12 are designed to reduce costs of pollution control, waste disposal, and site

remediation. Mini-mills with thin-slab continuous casting technologies can be constructed

at one-fifth the cost of integrated mills with conventional casting technology and incur about

10-percent lower annual operating costs.13 By enhancing economic performance, firms are
13(...continued)

Trade, and Technology Review, USITC, Oct. 1996, pp. 21-29.

14 Ibid.

10

Table 1

Advancements in process technology and product quality in the steel industry

Process step

Integrated-mill Mini-mill Selected improvements to steelmaking

1987 1997 1987 1997 technologies

Steelmaking—

 Tons per day (per furnace) . . 3,000 4,500 2,150 2,800 1970 Bottom blowing—basic oxygen 

furnace

 1985 Direct current—electric arc furnace

 1985 Advanced ladle refining

 1986 Ultra-high pressure oxygen

injection—electric arc furnace

 1990 Liquid iron in electric arc furnace

 Electricity use (kwh/ton) .... 25 25 485 430

Continuous casting—

 Tons per day (per strand) ... 2,000 3,500 2,100 2,750 1960 Conventional casting

 1988 Slim-slab casting (100-mm

minimum thickness)

 1989 Thin-slab casting (50-mm minimum

thickness)

 1994 Thin-slab casting squeeze (20-mm

minimum thickness)

 1997 Strip casting (10-mm minimum

thickness), stainless steel

 2000(p) Strip casting (10-mm minimum

thickness), carbon steel

 Yields (percent) .......... 97.0 97.5 97.5 98.0

Hot-strip rolling mill—

 Tons per day ............. 10,500 12,000 2,000 4,700 1975 Quick-change rolls

 1988 Light gauge (<1.7 mm)

 1994+ Ultra-light gauge (<1.0 mm) Yields (percent) .......... 95.5 96.5 95.5 97.5

Cold-rolling mill—

 Tons per day ............. 5,000 6,800 950 1,950 1995 Two-stand reversing cold-rolling

mill

 1994+ Ultra-light hot-rolled as cold-rolled

substitute

(p) - projected.

Source: Donald F. Barnett, “Harnessing New Technologies: Key to Winning,” World Steel Dynamics, Paine Webber

Inc. (New York, NY, June 17, 1997), pp. 215-238 and telephone interview with A. Cramb, Jan. 1998.

more able to strategically position themselves in the marketplace. Adoption of thin-slab

casting enabled Nucor Corporation to be the first company world-wide to build a new, flatrolled mini-mill in the United States in the late 1960s, reportedly from a perception that this

technology provided a means of overcoming the large-scale capital and production entry

barriers to an industry segment dominated by the integrated mills.14

Confronting the Barriers to Commercializing NMPM

Numerous barriers hinder commercialization of innovations (table 2). Among the most

significant barriers are the long time-horizon and high costs, which limit profitability and
15 Thomas W. Eagar, “Bringing New Materials to Market,” Technology Review, Feb./Mar.

1995, pp. 43-49.

11

make it difficult for a firm to recoup its investment in successful projects. This is most

likely when patent protection expires near the end of development, or in industry sectors

with short life-cycles.15 The experience of AlliedSignal Incorporated in commercializing

a new product made with amorphous metals demonstrates how a combination of approaches

may be necessary to address the numerous barriers that can simultaneously impede the

commercialization process (see text box). Likewise, the magnitude of investment often

required to bring an innovation to commercialization may be more than a firm can feasibly

finance alone, given the anticipated rate of return; many firms have scaled back “in-house”

research efforts or closed down their R&D facilities entirely.

Table 2

Barriers to commercialization of new manufacturing processes for materials

Source of barrier ...to developing NMPM ...to adopting NMPM

Time horizon Failure to recognize lengthy R&D period

needed (often a decade or more) to

develop a market for an innovation.

Lengthy learning and adjustment period

needed to achieve desired product

quality.

Technological Resulting material’s properties are not

entirely suitable for existing market

application; underdeveloped markets

in some cases.

Resulting material’s properties are not

entirely suitable for specific industry

application.

NMPM may be more suitable for a new

state-of-the-art facility and retrofit may

not match scale production economies.

Financial or economic

performance

Magnitude of required investment, given

anticipated returns.

Resulting products with high unit cost

may be suitable only in industries

requiring specific material properties.

Limited initial production capacity or

market demand, especially for

improved or new materials.

Capital cost exceeds anticipated returns.

Resulting products with high unit cost

may be suitable only in industries

requiring specific material properties.

Existing process technology may embody

sunk costs or possess lengthy

remaining economic life.

Corporate culture Organizational separation among units

involved in R&D process; differences

in attitudes and values among units.

Territoriality among organizational units; 

suspicion of projects originating outside

of unit.

Risk-adverse or risk-neutral approach to

decision making; receptive to

innovative NMPM but adopts wait-andsee approach.

Regulatory environment Inflexible codes and standards preclude

use of resulting material.

Antitrust regulations inhibit collaborative

R&D.

Inflexible codes and standards preclude

use of resulting material.

Strategic considerations prevent NMPM

from being acquired by economic rivals

or hostile foreign powers.

Source: Compiled by USITC staff from various government documents and industry publications.
16 For example, an innovation is successful to a technician if it can be produced in a

laboratory, but for management, if it can be manufactured and survive in the marketplace.

17 See: John J. Wise, “An Evolving Partnership, Mobil has Adopted a Number of Innovative

Practices Designed to Strengthen its Technology/Business Partnership and Expedite the Transfer

of Its Technology,” Research-Technology Management, vol. 38, No. 6, Nov./Dec. 1995, pp. 37-

41; Charles E. Bosomworth and Burton H. Sage, Jr., “How 26 Companies Manage their Central

Research,” Research-Technology Management, vol. 38, No. 3, May/June 1995, pp. 32-40; and

Derek L. Ransley and Jay L. Rogers, “A Consensus on Best R&D Practices,” Research

Technology Management, vol. 37, No. 2, Mar.-Apr. 1994, pp. 19-26.

18 Wise, “An Evolving Partnership.”

19 Mobil found that previously separate product laboratories and technical service units often

slowed the transfer of technological developments to business divisions, and were duplicative at a

time when it was under pressure to cut costs. Ibid.

20 Steven W. Irwin, Technology Policy and America’s Future (St. Martin’s Press, New York,

NY, 1993).

12

Producing amorphous metals using the rapid solidification process: 20 years to commercialization.

The rapid solidification process cools molten metals extremely quickly to an amorphous metal (AM) in which the

atoms are randomly spaced, as opposed to the ordered structure of conventionally cooled metals. Given the excellent

magnetic properties of iron-based AM alloys, electrical distribution transformer cores made of these alloys consume

60 to 70 percent less energy than those with the most efficient conventional silicon-steel cores. If all U.S.

distribution transformers used AM alloy cores, the annual operating cost savings could exceed $3 billion (based on

the average residential rate for electricity), according to AlliedSignal (AS) Incorporated, the developer of this

technology.

Processing technology was the most significant barrier identified in developing rapid solidification; perfecting the

process took AS almost 20 years. Many other potential barriers were avoided because AS received development

assistance from a Federal laboratory, had regulatory agency support, and had close cooperation from the industry's

standards-setting organization. The technology, when applied to making distribution transformers, was accepted by

end users (electric utilities) in the United States with minimum reservations, and AM transformers captured 12

percent of the U.S. market during 1990-95. Recently, however, utilities have been reluctant to switch to these

transformers because energy costs are decreasing in real terms, and the economic incentive for installing AM

transformers (which cost 10 to 15 percent more) is decreasing.

Source: Compiled by USITC staff from company publications and interviews of company representatives.

Corporate culture also may contribute to delays and cost overruns because of organizational

separation between technical and business units, and differences in goals and values.16

Private firms use various combinations of approaches to overcome such cultural tendencies,

employing cross-functional teams and enhancing communication between functional units

were most commonly reported.17 Mobil Oil Company relies extensively upon both strategies

to develop and maintain its core technical competencies, including advanced catalytic

processing for refining petroleum and synthesizing chemicals.18 Another approach to

encourage interaction between technical and business units is centralizing technological

functions.19 For example, by centralizing new-product development and integrating

representatives from all functional units into development teams, production and marketing

difficulties at Chrysler Corporation can be anticipated before finalizing product designs.

Because the design of a product determines a large share of production costs, Chrysler

anticipates significant reductions in both final product costs and development time through

this approach.20 Likewise, the existence of formalized project plans and written

procedures, which provide early agreement between the business and research units,

eliminates false starts and defines responsibilities that would otherwise take time to evolve.
21 Wise, “An Evolving Partnership.”

13

Producing aluminum metal matrix composites using the stir-casting process: technical and economic

barriers delay commercialization.

Metal matrix composites (MMC) consist of a metal or metal alloy (matrix) with a reinforcing material (usually

ceramic) dispersed throughout. Duralcan, a subsidiary of Alcan Aluminum Limited, developed a proprietary stircasting technique to produce aluminum MMC, which are reinforced by particles of silicon carbide or aluminum

oxide. Aluminum MMC offer comparable stiffness, corrosion resistance, and abrasion resistance as conventional

steel or cast iron, but with considerable weight savings. In automobile drive shaft and brake-rotor applications,

aluminum MMC save 18.0 and 7.5 pounds, respectively.

However, automobile manufacturers have been reluctant to adopt this new material for technical and economic

reasons. Aluminum MMC cost $1.50 to $2.00 per pound (depending on production volume) compared with $0.90

per pound for aluminum, $0.50 per pound for steel, and $0.20 per pound for cast iron. Fabrication costs are higher

than for conventional materials because parts made of aluminum MMC must be finished with diamond tools. Entire

assemblies would have to be redesigned to fully exploit the advantages of this advanced material. Also,

manufacturers are particularly sensitive to product-safety concerns, which limit use for brake components.

To commercialize aluminum MMC, Duralcan sought closer links with the U.S. automotive industry by approaching

manufacturers directly, setting up a marketing arm in the Detroit area, and even relocating production facilities. A

decade after Duralcan was formed to manufacture and commercialize this advanced material, General Motors and

Chrysler Corporation are trying aluminum MMC parts in limited production runs of drive shafts and brake rotors;

such trials will allow aluminum MMC parts to prove their reliability and long-run cost-effectiveness. Other industry

sectors have turned to aluminum MMC for specific applications, including specialized bicycle frames, sporting

goods, and even snow tire studs. These applications present less volume potential but nevertheless encourage sales

and market development of aluminum MMC.

Source: Compiled by USITC staff from industry publications and interviews of company representatives.

Incorporating lessons learned from past project plans also contributes to success; Mobil

relies extensively on formal mechanisms for reviewing project progress, including postproject auditing to learn from its experiences.21

In addition to these factors, technical barriers may hinder the adoption or commercialization

of NMPM. New materials may be initially unsuitable for existing market applications

because they exhibit significantly different specifications or physical properties than

conventional materials, or because of their high initial unit costs. For example, despite

considerable weight savings and long-run cost savings of aluminum metal matrix composites

(MMC), the automobile industry was hesitant to substitute this advanced material for steel

and cast iron in drive shafts and brake rotors because of significantly higher initial per-unit

material costs, higher machining costs, and the large amount of capital investment necessary

to retrofit process lines. To commercialize this new material, Duralcan approached the U.S.

automotive industry to try aluminum MMC in limited production runs to demonstrate the

material’s reliability and potential long-run cost-effectiveness (see text box).

Collaboration between private firms—

Direct firm-to-firm collaboration is ideal for resolving the classic risk-associated problem

of hesitancy on the part of materials producers to invest in expanding production capacity

for a new high-performance product where its potential market niche is small, and likewise,

the hesitancy of materials users to invest in switching to such products with limited

availability. To speed up commercialization, U.S. Steel worked closely with Chrysler
22 John Schriefer, “Increasing R&D’s Productivity,” New Steel, vol. 12, No. 6, June 1996, pp.

72-78.

23 Torque tubes are aluminum and steel drive-shaft assemblies that are part of the control

system that raise and lower the flaps and slats on aircraft wings. The Grumman process extends

the service life of the torque tube by strengthening the joint between the tube and fittings. 

Grumman has used electromagnetic forming for more than 20 years in the production of military

aircraft, although this is the first commercial application of this technology. Grumman also offers

this process for automotive and other high-stress, rotary-motion applications. Anthony L.

Velocci, Jr., “Ventures Rife with Marketing Pitfalls,” Aviation Week and Space Technology, vol.

139, No. 19, Nov. 8, 1993, pp. 59-61.

24 John A.S. Green, John Brupbacher, and David Goldheim, “Strategic Partnering Aids

Technology Transfer, Martin Marietta Finds Technology Transfer Through Strategic Partnerships

a Rapid, Effective and Successful Tool for Developing Novel Engineered Materials,” Research

Technology Management, vol. 34, No. 4, July/Aug. 1991, pp. 26-31.

25 Ibid.

14

Corporation to fine-tune its newly developed steel sheet with an iron-zinc coating to be

compatible with the latter’s painting system. In anticipation of a major market for its output,

U.S. Steel could justify the expenditure for substantial modifications to its

electrogalvanizing process to produce the new iron-zinc steel sheet. Furthermore, the time

span from concept to full-scale manufacturing was 3 to 4 years, compared with 10 or more

years to commercialize new products in the past.22

To side-step the time and expense of the earlier stages of the R&D process, private firms

may elect to adopt innovations developed by outside sources in either a partially or fully

commercialized state. Two well-established mechanisms are licensing and strategic

partnerships. For a license-granting firm, licensing its technology can be an alternative to

expending resources to develop new markets and scale up to full commercial production.

The mutual benefits attendant with licensing are illustrated by the Boeing Company’s 1993

agreement with Grumman Corporation to apply Grumman’s patented electromagnetic

forming process for torque-tube joints in commercial aircraft, a deal that could be worth

$10 million over the next 10 years.23

In a strategic partnership, two firms agree to share marketing and commercialization of a

product or process created by one firm but developed by the other. This arrangement

enables the originating firm to commercialize an innovation despite lack of technical

expertise, skilled personnel, sufficient funding, or adequate capital equipment. Martin

Marietta used a strategic partnership to commercialize high-strength aluminum alloys and

metal matrix composites, as the company’s core business is not materials production.24 For

this case, important considerations for selecting a strategic partner were that the two firms

should compete in different market segments and have similar organizational cultures, a high

level of management commitment, a defined strategy to aggressively develop and

commercialize the technology, and the technical ability to work closely together. With both

licensing and strategic partnerships, the acquiring firm receives access to a technological

innovation with less investment in R&D, but must finance fine-tuning the innovation for

application, and must develop detailed marketing plans. A significant positive feature of

such partnerships is that commercial applications are developed concurrently with technical

development. For Martin Marietta’s technologies, markets may be already partially

developed by strategic partners who are often major customers.25
26 Eagar, “Bringing New Materials to Market.”

27 Schriefer, “Increasing R&D’s Productivity.”

28 Potential annual energy savings for the U.S. steel industry anticipated from the six projects

are estimated at 16.5 trillion BTUs, which could cut costs to the industry by $103 million. 

Furthermore, potential NOx emissions could be cut by an estimated 13,000 metric tons, SOx by

80,600 metric tons, and particulate matter by 33,100 metric tons. National Renewable Energy

Laboratory, Technology Partnerships, Enhancing the Competitiveness, Efficiency, and

Environmental Quality of American Industry, for the U.S. Department of Energy, Office of

Energy Efficiency and Renewable Energy, Office of Industrial Technologies, DOE/GO-10095-

170 DE95004086 (Washington, DC, Apr. 1995).

29 Tim Stevens, “Success in Numbers: A Research Consortium Can Yield Big Payoffs to

Member Companies, If They Do It Right,” Industry Week, vol. 243, No. 7, Apr. 4, 1994, pp. 45-

48.

15

An alternative to adopting from outside a firm is pre-competitive collaboration with other

firms. This approach to commercialize NMPM enables participants to spend R&D funds

more efficiently and helps reduce duplication of expenditure and effort, especially in the

early phases of a project.26 Private firms may form horizontal consortiums to tackle

problems common to an entire industry, although the firms remain competitors in the

marketplace. An increasing number of vertical consortiums are being formed among firms

from the various stages of production, as manufacturers increasingly interact with suppliers

and customers to develop innovative technologies. For example, the 5-year Advanced

Process Control Research Program, coordinated by the American Iron and Steel Institute,

includes steelmakers, industry suppliers, and Federal laboratories27 collaborating in the

development of advanced sensor and process-control technologies to improve steelmaking

efficiency and reduce energy consumption and emissions.28 Factors for successful

consortiums include long-term commitment and active participation of members (including

management), access to members’ marketing and manufacturing capabilities, and a

focused technology strategy.29 Furthermore, potential benefits are maximized with partners

whose R&D capabilities are complementary.

Looking to R&D institutions as sources of innovative

technologies—

Collaboration with Federal laboratories and research universities rather than competitors

may be preferable to some firms, especially due to intense interfirm rivalries and problems

of sharing intellectual property rights. In addition, R&D institutions offer access to

technical expertise and advanced facilities that would be too expensive for most firms to

build and operate (e.g., high-powered computational and sophisticated analytical

capabilities).

The abilities of the 700+ Federal laboratories to develop and commercialize NMPM

depend to a great degree on the mission of the supporting agency and past experience. A

notable example is the extensive collaborative effort between the U.S. polymer industry and

the National Center for Agricultural Utilization Research to develop less expensive, more

versatile, advanced superabsorbent polymers. The results of this research not only enabled

the polymer industry to regain its domestic market share from foreign competitors, but also

to enter new markets abroad (see text box). Although collaborative mechanisms range

from informal sharing of information (through laboratory publications, workshops and

seminars, and technical consultations) to the use of Federal laboratory facilities, employee
30 Based on two surveys of chief technical officers and laboratory directors of industrial firms

by the Georgia Institute of Technology. There was less enthusiasm for licensing agreements

because many laboratory innovations needed further development at initial licensing to bring them

to commercial success. Cited in: David Hughes, “Industry Seeks Expertise in Federal Lab

Interaction,” Aviation Week & Space Technology, vol. 139, No. 19, Nov. 8, 1993, pp. 56-58; and

J. David Roessner and Alden S. Bean, “How Industry Interacts with Federal Laboratories,”

Research Technology Management, vol. 34, No. 4, July/Aug. 1991, pp. 22-25.

31 Both partners provide relatively equal amounts of resources (facilities, equipment,

personnel, expertise, and funding) to the agreement, but the Federal laboratory cannot provide

appropriated funds. Dan Cordtz, “Bye-Bye, Dr. Strangelove, Threatened with Extinction by

Politicians, U.S. Weapons Labs are Dying to Help Business,” Financial World, vol. 164, No. 2,

Jan. 17, 1995, pp. 32-37.

32 From quarterly surveys of its CRADA partners, Sandia National Laboratory found that the

program was responsive to industry queries, and technical goals and milestones were being met,

but the time required to conclude agreements needed to be reduced. William B. Scott,

(continued...)

16

Superabsorbent starch-based polymers: commercializing Federal laboratory innovations for revival and

expansion of domestic industry.

Superabsorbent polymers are used in air filters, to mop up spills and absorb wastes, to reduce watering requirements

of crops, and in numerous products in the construction, electrical, petroleum, and chemical industries. The specific

absorbency of polymers allows some mixed liquids to be readily separated, for example, extracting water from diesel

fuel or gasoline.

In the 1980s, the U.S. polymer industry was losing its market share to foreign competition in the $1-billion-a-year

domestic market, particularly to producers of petroleum-based synthetic absorbents. Scientists at the Department

of Agriculture’s National Center for Agricultural Utilization Research (NCAUR) revisited past research and relied

upon extensive links with industry to identify existing and potential applications; product performance requirements;

and production, equipment, and market needs. Industry engineers and researchers were invited to observe and

comment during laboratory preparation of the polymer, and NCAUR scientists collaborated with industry to resolve

technical problems during scale-up to commercial production.

This public-private collaboration resulted in improved starch-based polymers that are more absorbent, effective for

a broader range of substances, and less expensive than other absorbent polymers. As a result, the domestic polymer

industry regained its standing in the domestic market, and opened new markets as U.S. manufacturers began selling

overseas.

Source: George Fanta and William Doane, “Researchers Starch Up Soggy U.S. Polymer Industry,” Winners in Technology

Transfer (Federal Laboratory Consortium for Technology Transfer, Washington, DC, 1994).

exchanges, and licensing, three mechanisms were most frequently cited as promising future

payoffs: industry-sponsored research, contract research, and cooperative R&D.30

The use of cooperative research and development agreements (CRADAs) has

mushroomed since their inception in 1986 because of unique advantages over other forms

of industry-Federal laboratory collaboration. These advantages include exclusive

ownership of patent rights for the industrial partner, protection of proprietary information,

and royalty shares for government researchers. To some critics, the CRADA program is too

generous to industrial partners who essentially pay half the R&D costs,31 and some industry

officials have criticized the long delays for CRADA approval.32 In contrast, supporters have
32(...continued)

“Technology Transfer Support Wavers,” Aviation Week & Space Technology, vol. 143, No. 17,

Oct. 23, 1995, pp. 57-60.

33 Charryl Berger, deputy director of the Los Alamos National Laboratory Industrial

Partnerships Office, cited in: Cordtz, “Bye-Bye, Dr. Strangelove.”

34 Robert Killoren, “University-Industry Interactions, Room for Diversity,” SRA Journal, vol.

25, No. 2, June 1994, pp. 31-35.

35 Federal-agency programs encouraging U.S. industry to innovate were reviewed in

Abrahamson, “New Manufacturing Processes for Materials: Government Policies and Programs

Towards Commercialization.”

36 U.S. Congress, OTA, Innovation and Commercialization of Emerging Technologies.

37 Paul Proctor, “Regional Agencies Help Small Firms Get Foothold,” Aviation Week & Space

Technology, vol. 143, No. 17, Oct. 23, 1995, p. 62.

38 Based on a study of survey results from 120 small manufacturing firms in middle

Tennessee. John Masten, G. Bruce Hartmann, and Arief Safari, “Small Business Strategic

Planning and Technology Transfer, the Use of Publicly Supported Technology Assistance

Agencies,” Journal of Small Business Management, vol. 33, No. 3, July 1995, pp. 26-37.

17

questioned the wisdom of firms paying the entire cost, which would reportedly turn

laboratories into “job shops,” a shortcoming the CRADA program was designed to

discourage.33

Industry also has a long history of interaction with research universities. Although

universities are capable of long-range basic research, it is on a relatively small scale

compared with the Federal laboratories, and is usually confined to specific academic

disciplines. These factors, plus academia’s emphasis on freedom of inquiry, can be

problematic in meeting private industry’s need for multi-disciplinary, applied R&D

assistance. To bridge these cultural differences, many academic institutions have

developed technology transfer centers to coordinate and facilitate customized assistance.

This type of collaboration is most common for incremental improvements to existing

technologies or products.34

Taking advantage of government technology-commercialization

programs—

At all levels of government, there are programs to promote the transfer of technology from

R&D institutions to private industry, particularly to small- and medium-size business.35 At

the state and local level, for example, there are some 390 technology-commercialization

programs.36 These vary in structure, focus, and range of services, from providing technical

assistance to small businesses, promoting industry collaborations, and offering literature

search capabilities, to financing small businesses and giving start-up assistance to small

technology-based firms or regional industries. Despite successes, these efforts reportedly

are sometimes criticized not only for lacking expertise, but also for wasting funds because

of inefficiencies, program overlap, and bureaucratic snarls.37 Awareness of local

technology-commercialization resources was reported to be low among small

manufacturers, but use increased with extent of prior use.38 It also has been reported that

small firms generally are in greater need of “off-the-shelf” technologies, particularly
39 William H. Miller, “Federal Help, Don’t Laugh, The Commerce Dept’s. Expanding System

of Manufacturing Technology Centers is Trying to Show That the Feds Can be Useful,” Industry

Week, vol. 242, No. 14, July 19, 1993, pp. 55-61.

40 Materials Advisory Board, Commercialization of New Materials for a Global Economy.

41 Eager, “Bringing New Materials to Market.”

42 Ibid.

43 Materials Advisory Board, Commercialization of New Materials for a Global Economy.

44Office of Science and Technology Policy, Total Materials Cycle, the Pathway for

Technology Advancement.

45 Eager, “Bringing New Materials to Market;” and National Materials Advisory Board,

Commercialization of New Materials for a Global Economy.

18

computer-aided drafting and manufacturing software, and applying computerized

techniques to the factory floor for statistical process control and inventory control.39

Outlook: Further Actions for Effective Commercialization

of NMPM

Despite considerable progress toward commercializing innovative materials technologies,

observations of key participants in the process suggest that continued efforts are needed to

promote development and adoption of NMPM. Standards for test methods and materials

design should be developed,40 taking into account factors such as increased performance of

advanced materials and degree of risk for the application. For example, given the stronger,

more fracture-resistant steels that are now readily available, materials specifications for

pressure-vessel boilers are currently over-specified, being nearly the same as they were 50

years ago.41 In those cases where a single firm cannot afford to underwrite extensive testing

of an advanced material, pooling the cost of risk assessment may be helpful.42 Evaluation

of NMPM also could be improved by increased standardization of design-related, materialsproperty databases.43 For certain materials R&D areas that are seldom tied directly to

commercial applications, it is reported that the government may need to take the lead,

especially in supporting research to characterize and understand new materials, and in

developing advanced computational tools for new-material design methods, and life-cycle

performance analysis techniques.44

For private industry, reported recommendations focus on developing and expanding

markets for advanced materials.45 Collaborations to tailor an advanced material to meet

specific end uses and increase production and market capacity include:

C Establishing direct links with the ultimate end users of a material

rather than just the immediate customer.

C Increased mutual sharing of proprietary technical information and

marketing strategies between materials suppliers and users. Also,

increased joint ventures between materials suppliers and users.

C Incremental introduction strategies to improve existing products and

build market demand for an advanced material.
46 Allaire, Sheinkman, and Everhart, Endless Frontier, Limited Resources.

47 National Materials Advisory Board, Commercialization of New Materials for a Global

Economy. Private firms also impose barriers deliberately for strategic considerations, especially

to preserve trade secrets and protect economically valuable innovations from competitors. 

Likewise, foreign economic rivals also screen the acquisition of economically valuable

innovations by U.S. firms.

48 Brody, Effective Partnering.

49 National Materials Advisory Board, Commercialization of New Materials for a Global

Economy; and Brody, Effective Partnering.

19

Extremely fine metallic-membrane filters: posing a $2 billion

dual-use technology dilemma.

Martin Marietta was interested in applying metallic membrane

technology to commercial filtration applications ranging from effluent

treatment to purification of orange juice, with an estimated potential

of $2 billion in commercial business by 2000. This technology has

been developed by Oak Ridge National Laboratory for use as

extremely fine filters in the gaseous diffusion process for purifying

uranium. Declassification of this technology was halted by concerns

about the Iraqi government’s efforts to upgrade its nuclear processing

capabilities.

Source: Thomas G. Donlan, “The Price of Progress, Scientific Advances

Require Sound Investment Policies and Clear Goals,” Barron’s, vol. 74, issue

No. 26, June 27, 1994, p. 62.

To the extent that partnerships with private industry continue, results reportedly can be

improved through a number of specific policy changes by the Federal Government:

C Improve the continuity of Federal R&D resources to reduce fiscal

unpredictability.46

C Reform export-control regulations on dual-use technologies that

may unnecessarily interfere with interactions between U.S. firms and

foreign partners, restrict access to foreign technical bases, or limit

U.S. firms’ access to international markets (see text box).47

C Improve the speed, flexibility, and predictability of negotiating,

implementing, and funding industry partnership agreements with

Federal laboratories.48

C Promote timely and wide dissemination of information on Federally

funded innovations and R&D partnership opportunities49 by

establishing a centralized materials database.
50 Allaire, Sheinkman, and Everhart, Endless Frontier, Limited Resources; and National

Materials Advisory Board, Commercialization of New Materials for a Global Economy.

51 Lewis M. Branscomb, Aetna Professor Emeritus of Public Policy and Corporate

Management Center for Science and International Affairs, John F. Kennedy School of

Government, Harvard University, Testimony, Hearing of the Subcommittee on Science,

Technology and Space of the Senate Committee on Commerce, Science and Transportation, Apr.

16, 1997.

52 Federal partnerships with State programs are essential because states are much closer to the

practical need of local businesses through the efforts of State colleges and universities and State

commerce and transportation agencies. At their 1997 meeting in Washington, DC, the State

Governors created a formal structure for linking Federal and State research teams in partnership. 

John H. Gibbons, Assistant to the President for Science and Technology, Technology Partnering: 

Can You Count on the Government? (Federal Technology Report, McGraw-Hill Companies, Inc.,

Washington, DC, Mar. 3, 1997).

53 Brody, Effective Partnering.

54 Walter H. Plosia, Executive Director, North Carolina Alliance for Competitive

Technologies, “State and National Strategies for Promoting Innovation and Stimulating Economic

Development,” Trends in Industrial Innovation, Industry Perspectives and Policy Implications,

1997 Sigma Xi Forum, Arlington, VA, Nov. 20-21, 1997.

55 Allaire, Sheinkman, and Everhart, Endless Frontier, Limited Resources; and National

Materials Advisory Board, Commercialization of New Materials for a Global Economy.

56 Branscomb, Testimony, Hearing of the Subcommittee on Science.

20

C Pare agency bureaucracies and decentralize decision making to

allow laboratory directors to implement their own strategies and be

accountable for supporting commercial applications.50

C Increase partnerships with small- and medium-sized technology

firms.51

C Coordinate Federal programs with State programs,52 especially to

improve the effectiveness of small business in commercializing

innovative NMPM53 and to reduce overlap in State programs.54

For research universities, reported recommendations specific to NMPM focused on

disseminating updated knowledge about advanced materials:55

C Include advanced-materials selection and design in the materials

engineering curriculum.

C Promote continuing education for materials engineers on

technological advancements and practice-oriented training for

materials technicians.

C Promote programs for faculty and graduate students to gain

experience in industrial laboratories as a means of promoting links

between university and private-sector R&D.

C Increase partnerships with small- and medium-sized firms

specializing in technology.56
21

Private industry, government, and academia continue to commercialize innovative NMPM

in response to economic and regulatory incentives. The numerous interactive and often

interlinked approaches devised by these participants have evolved through time to address

many of the barriers that impede development and adoption of such innovative

technologies. The extent to which the above suggestions can be implemented will have

significant bearing upon the pace of technological innovation, which, in turn, impacts

industrial competitiveness in a rapidly changing and increasingly globalized marketplace.
22

Glossary of Terms

Consortium A joint R&D agreement among private firms to develop a technology of

common interest to participants. Government agencies and research

universities also may participate in or organize such ventures.

Cooperative research

and development

agreement (CRADA)

A formalized joint R&D agreement between private industry (either a single

firm or multiple firms) and a Government agency, national laboratory, or

research university.

Defense conversion Reorienting an institution’s R&D efforts from defense-related to commercial,

non-defense-related applications.

Dual-use technology Innovations with both commercial and military applications.

External acquisition of

technology

Innovations brought into a firm from an outside source. Also referred to as

“technology acquisition.” Contrast with internal technology development.

Horizontal consortium An industry consortium whose member firms normally compete in the same

or related markets. Contrast with vertical consortium.

Internal technology

development

Innovations developed by a firm from within, through successive functional

units involved in the R&D process. Contrast with external acquisition of

technology.

Licensing An agreement granting an acquiring firm access to the licensor’s

technology.

Market pull Technology development spurred specifically when a solution is sought by

the market to meet an existing technical need. Contrast with technology

push.

New manufacturing

processes for

materials (NMPM)

Any manufacturing process that can produce materials more efficiently than

can conventional processes, or can produce materials with superior

properties compared with conventional materials, or both. NMPM also

could result in entirely new materials.

Strategic partnership A joint R&D agreement between two private firms to commercialize a

technology initially developed by one, but in need of further development by

the other to bring the technology to the marketplace.

Technology push Technology for which there is currently no commercial market, but

developers seek commercial applications after its development is under

way or completed. Contrast with market pull.

Vertical consortium An industrial consortium whose members do not all compete in the same or

related marketplaces, but rather are drawn from the various stages of

production (e.g., materials suppliers, finished-product manufacturers, etc.). 

Contrast with horizontal consortium.
1Within the United States, the National Critical Technologies Panel (appointed by the Office

of Science and Technology Policy (OSTP)), the Department of Commerce, and the Council on

Competitiveness (a private organization of representatives from business, higher education, and

labor) have all identified materials and associated processing technologies as critical for U.S.

competitiveness and economic prosperity. Report of the National Critical Technologies Panel

(Washington, DC: Office of Science and Technology Policy), Mar. 22, 1991; U.S. Department of

(continued...)

23

New Manufacturing Processes for Materials:

Government Policies and Programs Towards

Commercialization

Dana Abrahamson

Cheryl Badra Qassis

(202) 205-3436

cqassis@usitc.gov

This article examines the Government’s increasing involvement in

research and development activities, with a particular focus on the

development and eventual commercialization of advanced

materials and processing technologies. Since the early 1990s, the

administration has emphasized Government-industry cooperation

in technology development as an important priority. Indeed,

several mechanisms have been established to facilitate

cooperation between the private and public sectors. In addition,

significant legislation has been passed promoting technology

transfer that has benefited the development of advanced materials

and processing technologies. Finally, the article discusses several

factors that will likely impact Government involvement in such

activities in the future.

Since this article was first published in the Industry, Trade, and

Technology Review of March 1995, policy mechanisms directing

Government coordination of materials R&D have been phased

out. However, budget allocations to the relevant agencies have not

decreased significantly, suggesting that materials development

efforts supported by the Federal Government will continue

relatively unhindered. In addition, there has been significant

legislative activity supporting R&D efforts that could affect the

Government’s R&D activities in materials. The concluding

section of this article elaborates on recent developments and

provides current funding estimates for certain programs. 

The development of advanced materials and processing technologies directly affect a

nation's economic prosperity, environmental health, and quality of life. The importance of

these related areas has been highlighted by numerous U.S. and foreign government and

private studies, all of which have reached similar conclusions.1 Materials processing
1

(...continued)

Commerce, Emerging Technologies: A Survey of Technical and Economic Opportunities

(Washington, DC: U.S. Department of Commerce), Spring 1990; and The Council on

Competitiveness, Gaining New Ground: Technology Priorities for America's Future

(Washington, DC: The Council on Competitiveness), Mar. 1991. 

2Committee on Science, Engineering, and Public Policy, The Government Role in Civilian

Technology: Building a New Alliance (Washington, DC: National Academy Press, 1992).

3

 In addition, Offices of Research and Technology Applications (information offices on

laboratory products and services) were established in every national lab.

24

technology is a vital enabling technology; with each advancement, the potential for advances

in other fields increases. This is because advances in processing technologies can result in

increased efficiency and productivity, lower production costs, and improved material

characteristics. This article examines the role the U.S. Government plays in the

development and precommercial stages of materials-processing technologies, outlining

shifts in government focus, the framework for government involvement, and the outlook for

future government involvement.

Shifts in Government Focus

The U.S. Government has a long history of involvement in the materials and materialsprocessing fields. For many years, Federal research and development (R&D) efforts in

these areas centered on defense- and space-related technologies used by the Department of

Defense and the National Aeronautics and Space Administration (NASA). Advances in

military and space systems often require the use of new materials or new processing

techniques where unique combinations of properties or specific characteristics are necessary.

As the principal consumer of military and aerospace technologies, the U.S. Government has

a vested interest in their development. As a result, the Government has been willing to

underwrite the risk and expense involved in developing these areas.

In the post-Cold War era, military threats have decreased and concerns about economic

competitiveness have become increasingly important. Accordingly, the U.S. Government

has, to a degree, shifted its focus from development of defense-related technologies to

development and transfer of technologies applicable in the commercial sector as well. In

addition, a trend towards greater cooperation and coordination of public/private efforts is

being embodied in current initiatives.

This recent administration's increased emphasis on technology transfer and

government-industry cooperation has been a continuation of legislative initiatives enacted

since the 1980s (figure 1).2 Relevant statutes include the Stevenson-Wydler Technology

Innovation Act (1980), which formally made technology transfer a policy of the Federal

Government by mandating that 0.5 percent of each national lab budget be spent on

technology transfer;3 the Patent and Trademark Amendments Act (1980), which gave

Federal agencies authority to grant licenses to small businesses and nonprofit organizations

(including universities) for inventions made at government- and contractor-operated

national labs; and the National Cooperative Research Act (1984), which limited the

potential application of antitrust laws in order to foster cooperative research among

companies.
25

Figure 1

since the 1980s

1990s

1980s

Source: Compiled by USITC staff.

1989 Public Law 101-189 National

Competitiveness Technology 

Transfer Act

1986 Public Law 99-502 Federal

Technology Transfer Act

1984 Public Law 98-462 National

Cooperative Research Act

1980 Public Law 96-517 Patent

and Trademark Amendments Act

(Bayh-Dole)

1980 Public Law 96-480 

Stevenson-Wydler Technology

Innovation Act

1993 Public Law 103-42 National

Cooperative Production Amendment

1992 Public Law 102-564 Small

Business Research and

Development Enhancement Act

1991 Public Law 102-245 

American Technology

Preeminence Act 

Legislative initiatives promoting technology transfer enacted
4Clinton, William J., and Albert Gore, Jr., Technology for America's Economic Growth, A

New Direction to Build Economic Strength (Washington, DC, Feb. 22, 1993). 

5Office of Science and Technology Policy, Advanced Materials and Processing: The Fiscal

Year 1994 Federal Program (Washington, DC: Office of Science and Technology Policy, July

1993), p. 6.

26

More recently, the Federal Technology Transfer Act (1986) amended the

Stevenson-Wydler Act, delegating authority to national labs to enter into cooperative

research and development agreements (CRADAs) with non-Federal parties (i.e., private

businesses). The National Competitiveness Technology Transfer Act (1989) included

technology transfer in the mission of the national labs. Further, the American Technology

Preeminence Act (1991) aimed to strengthen programs promoting U.S. economic

competitiveness at the various agencies. The Small Business Technology Transfer Act

(1992) outlined specific rules for technology transfer. And finally, the National

Cooperative Production Amendment (1993) amended the National Cooperative Research

Act, further modifying antitrust laws to increase research joint ventures in the private

sector. In addition, many Federal agencies have specific legislation governing technology

transfer.

Framework for Government Involvement

As part of the U.S. Government's new focus on technology, in 1993 the Clinton

administration enunciated a new emphasis on public/private cooperation in technology

development.4 Federal agencies are to facilitate civil technology development in

precommercial areas, to foster cooperative efforts between the Government and the

private sector, and to transfer new technologies developed in Government facilities to all

sectors of the economy. These changes are expected to increase the ability of private

industry to leverage its R&D expenditures with Federal monies as well as to gain access to

the vast array of technology already under development at the national labs. Moreover, the

U.S. Government will be able to leverage taxpayer funding of the national labs with private

R&D expenditures.

This change in emphasis was formally stated in Advanced Materials and Processing: The

Fiscal Year 1993 Program (AMPP), a supplement to the President's budget request for

fiscal year 1993. The AMPP provides a framework to promote interaction and cooperation

among all players in the technology development field (government, industry, and

universities) and to facilitate the progression from technology innovation to application.

One stated goal of the AMPP is to improve the performance and manufacture of materials to

enhance the quality of life, security, industrial productivity, and economic growth in the

United States.5 Agencies participating in the AMPP and significantly involved in materials

technology include the Department of Commerce, Department of Defense, Department

of Energy, Department of the Interior, Department of Transportation, Environmental

Protection Agency, Department of Health and Human Services, NASA, National Science

Foundation, and Department of Agriculture. Table 1 lists AMPP funding levels for these

agencies. 
6Gore, Albert, Jr., "From Red Tape to Results: Creating a Government that Works Better &

Costs Less," Report of the National Science Foundation and Office of Science and Technology

Policy (Washington, DC: Office of the Vice President), Sept. 1993, p. 5.

7Clinton, William J., and Albert Gore, Jr., Technology for America's Economic Growth, A

New Direction to Build Economic Strength (Washington, DC, Feb. 22, 1993), p. 8.

8According to the Stevenson-Wydler Act (1980), 0.5 percent of each national lab budget was

allocated to technology transfer activities.

9Clinton, and Gore, Technology, Washington, DC, Feb. 22, 1993, p. 9.

27

Table 1

Funding levels under the Advanced Materials Processing Program, 1992-94

(Million dollars)

Agency 1992 1993 1994

Department of Agriculture ............................. 36.3 37.4 45.8

Department of Commerce ............................ 2.6 48.4 56.7

Department of Defense1 .............................. 530.9 557.7 421.7

Department of Energy1 ............................... 862.5 914.0 941.5

Department of the Interior ............................. 5.2 24.9 21.5

Department of Transportation .......................... 1.0 14.9 12.7

Environmental Protection Agency ...................... 0.5 4.5 4.5

Health and Human Services ........................... 79.6 85.9 92.9

National Aeronautics and Space Administration ........... 76.3 102.8 131.1

National Science Foundation .......................... 265.6 303.6 328.0

 Total .......................................... 1,933.5 2,094.1 2,056.4

 

1

 This figure does not include classified research and development activities.

Note.--Data for 1992 are actual expenditures, 1993 are congressional appropriations, and 1994 are the President's budget request.

Source: Office of Science and Technology Policy, Advanced Materials and Processing: The Fiscal Year 1994 Federal Program

(Washington: Office of Science and Technology Policy, 1993), p. 13.

During 1994, the U.S. Government allocated over $75 billion in R&D expenditures.6 Of the

total budget, approximately 60 percent was allocated to military and defense technology

projects, with the remaining 40 percent directed at civilian or commercial projects.

However, with the shifting focus to economic competitiveness, the administration has

stated that it would like to see this ratio reach 50-50 by 1998.7 To reach this goal, agencies

are increasing their outreach programs to the private sector and developing a wide range

of mechanisms to facilitate public-private partnerships.

The national labs affiliated with the various Federal agencies offer private industry R&D

projects a source of funding, research, and technical advice. There are over 700 national

labs, which spend $35 billion to $40 billion annually on research and development

efforts, with generally 5 to 10 percent spent in R&D partnerships with industry.8 The

administration has stated that this portion should be increased to 10 to 20 percent of the

budget of each laboratory.9

A wide range of mechanisms are available to facilitate public-private partnerships. They

include personnel exchanges, data exchange agreements, use of specialized facilities,

cost-shared procurement, cooperative agreements, patent and software licensing,
10Additional information about CRADAs and other technology transfer mechanisms is

available from a number of sources including DOE and DOC, and is summarized in DOE’s

“Technology Transfer Quick Reference: Technology Transfer Mechanisms.”

11More detail on the PNGV is available from the Department of Commerce.

12Stockdale, Grant, president, Technology Publishing Group, Washington, DC, USITC phone

conversation, Jan. 20, 1995.

13Department of Energy, Washington, DC.

28

reimbursable work for others, technical assistance, and cooperative research and

development agreements.

CRADAs represent one of the main mechanisms for technology transfer from the

Federal agencies and nationals labs to the private sector.10 Under a CRADA, one or more

Federal agencies, through its laboratories, may provide personnel, services, facilities,

equipment, or other resources (not including funds), with or without reimbursement, to

one or more non-Federal parties. In turn, private parties may provide funds, personnel,

services, facilities, equipment, or other resources toward the conduct of specified R&D

that is consistent with the laboratory missions. CRADAs are designed to limit paperwork

requirements and to allow flexible implementation. For example, agencies can streamline

procedures or shorten approval times, which can range from a few weeks to over 18

months, and have some discretion in entering any agreement.

Legislation encouraging industry to participate in CRADAs includes an exemption for

participating parties from antitrust regulations, thereby allowing large segments of an

industry to cooperate in Federally funded research efforts. For example, the Partnership

for New Generation Vehicles (PNGV) is an initiative between the U.S. Government and

the "Big Three" auto manufacturers (General Motors, Ford, and Chrysler) that focuses on

developing a new generation of fuel-efficient vehicles. The Government part of the

partnership is an interagency effort headed by the Department of Commerce and includes

the Departments of Defense, Energy, and Transportation, the Environmental Protection

Agency, NASA, and the National Science Foundation.11

In addition, CRADA legislation allows private entities to obtain rights to intellectual

property developed within a CRADA while protecting any existing patents a company

or lab brings to the project. Moreover, the Federal Technology Transfer Act established

royalty sharing for Federal inventions and directed agencies to promote technology

transfer via a cash awards incentive program for Federal employees. 

As of December 1, 1994, 3,220 CRADAs were signed, partnering private industry with

national laboratories.12 The number of CRADAs has increased dramatically in the last

few years. For example, as of January 1, 1993, the Department of Energy had 329

CRADAs with private industry. However, by January 1, 1995, this number had risen to

1,157, with a value of $2.1 billion (of which industry contributions accounted for 57

percent).13

Examples of CRADAs in the materials processing area include gel casting and precision

aluminum forming. The Oak Ridge National Laboratory has signed several CRADAs

involving its gel casting technology, including one with AlliedSignal and another with
14Gel casting involves creating a gel with ceramic material that is then able to be poured into a

mold and hardened. This process allows more intricate parts to be made and has the potential to

reduce manufacturing costs of forming ceramic parts. 

15USITC phone interview, representative of Oak Ridge National Laboratory, Oak Ridge, TN.

16Lawrence Livermore National Laboratory, Industrial Partnerships-The Dual Benefit Story,

Livermore, CA, Oct. 1994.

17National Research Council, Commercialization of New Materials for a Global Economy

(Washington, DC: National Academy Press, 1993), p. 21.

18National Materials Advisory Board, "Commercialization of New Materials for a Global

Economy" (Washington, DC: National Research Council), 1993, p. 15; and John T. Schofield,

Chairman and CEO of Thermatix, Inc., U.S. Department of Energy, background paper on

Understanding "Valley of Death" issues in Federal R&D (Washington, DC: U.S. Department of

Energy), Dec. 5, 1994. 

29

Ceramic Magnetics.14 In both cases, the companies are providing design and field

testing, while Oak Ridge is tailoring its original process technology to each company's

needs.15 The Lawrence Livermore National Laboratory and Sandia National

Laboratories have partnered with the Aluminum Company of America (ALCOA) to jointly

advance the state-of-the-art in computational analysis of aluminum-forming processes.

This development has the potential to reduce manufacturing costs and improve product

quality, both of which can reduce the life cycle costs for a variety of U.S. industrial

products.16

Agencies are also implementing outreach programs, designed to inform the private sector

of what facilities and resources are available. Outreach programs include agency

participation in trade shows, conferences, expositions, and professional society meetings.

In addition, several agencies, including NASA, the Department of Energy, and the

Department of Defense, have established databases to assist industry with problems and

provide information about available technology and Federal resources. Table 2 outlines

the technology transfer mechanisms used by the various agencies.

Outlook for Future Government Involvement

The National Research Council regards faster commercialization of materials technology

as critical to ensure U.S. Government ability to specify and procure advanced military

and space systems, to obtain maximum benefits from available materials technologies at

costs equivalent to those in commercial production, to enhance the competitiveness of the

U.S. industries, and to extend U.S. technological leadership.17 

The commercialization process can be divided into several phases or stages, including

basic research/idea development; exploratory development or initial concept validation;

pilot development; prototype development; application/demonstration; and commercial

use.18 U.S. Government funding generally is limited to the early stages because of legal

constraints and the traditional government policy of limiting involvement in business

economic-decision making (figure 2). 

The new Agreement on Subsidies and Countervailing Measures in the Uruguay Round

Agreement (URA), establishing the World Trade Organization (WTO), addresses

generally the subject of subsidies and the remedies that WTO members may take 
30

Table 2

Agency involvement in materials processing R&D and technology transfer

Agency Processing Research and Technology Transfer 

Department of Commerce,

National Institute of Science &

Technology (NIST)

Carried out in 7 labs, particularly the Materials Science and Engineering Lab (MSEL);

MSEL has major programs in advanced ceramics, advanced heat engines, and

polymermatrix composites. NIST promotes technology transfer via CRADAs and outreach

activities.

Department of Defense (DOD) Carried out by the Army, Navy, Air Force, and the Advance Research Projects Agency

(ARPA). Research efforts are geared to providing future military systems, however, dual-use

applications of defense technologies are encouraged. Technology transfer occurs primarily

through the hundreds of DOD-supported university research centers.

Department of Energy (DOE) DOE has the largest program among the 10 agencies, ranging from fundamental research to

demonstrations of materials fabrication technologies. Technology transfer is facilitated

through direct grants, research collaboration, industrial use of DOE facilities, CRADAs, and

outreach activities.

Department of the Interior (DOI) Materials R&D is carried out through the Bureau of Mines (BOM) and is focused on

environmental and conservation issues related to engineered and commodity materials. 

Technology is transferred via CRADAs and Memorandums of Understanding (MOU) in

addition to outreach programs.

Department of Transportation

(DOT)

Materials R&D is supported by the Coast Guard, the Federal Aviation Administration, and

the Federal Highway Administration. Projects are usually directed at transportation

technologies. Nearly all DOT research is publicly disseminated because DOT must

coordinate its activities with state and local governments and the transportation industry. In

addition, DOT provides opportunities for joint research activities with industry and

universities.

Environmental Protection Agency

(EPA)

Research efforts in materials and materials processing are directed at improving the

environment. Research is carried out by the Risk Reduction Engineering Laboratory

(RREL) and the Air and Energy Engineering Research Laboratory (AEERL). Both labs

work closely with industry, via CRADAs and licensing agreements.

Department of Health and

Human Services (HHS)

Materials R&D is carried out by 12 units of the National Institutes of Health (NIH) and by

the Food and Drug Administration (FDA), focusing on improving biomaterials and

bimolecular materials for use in medical device implants. HHS maintains extensive

communication with academia and industry as most NIH research is conducted by outside

investigators via grants and contracts.

National Aeronautics and Space

Administration (NASA)

NASA materials research revolves around developing advanced materials and processes for

use in engines and airframe structures. Technology is mainly transferred through close

cooperation with the U.S. aerospace industry. In addition, there is the Technology

Utilization Program which fosters liaisons with industry and produces publications. Finally,

NASA reaches out to universities and small businesses through its network of 10 universityaffiliated Industrial Application Centers and 12 Centers for the Commercial Development of

Space.

National Science Foundation

(NSF)

NSF materials research centers on the synthesis of new materials, fundamental principles,

novel and creative approaches to materials processing, applying basic knowledge to

materials, and training future scientists and engineers in materials research and processing. 

NSF transfers technology via projects at multi-user research facilities, which reach out to

industry and national labs to optimize the application of new fundamental knowledge. In

addition, NSF promotes technology transfer by training students for careers in materials

science.

Department of Agriculture

(USDA)

Materials research at USDA is carried out by the Forest Service, the Agricultural Research

Service, and the Cooperative State Research Service. Research activities focus on the use of

renewable, nonfood agricultural materials and their derivatives in industrial processes and

products. USDA transfers technology primarily through CRADAs and by working directly

with the private sector at the point of commercialization of industrial uses of agricultural

products, with emphasis on advanced materials.

Source: Office of Science and Technology Policy, Advanced Materials & Processing: The Fiscal Year 1994 Federal Program,

Washington, DC, July 1993.
31

Government involvement

Time

Stages of commercialization and government involvement

Source: National Materials Advisory Board and John T. Schonfield, Chairman and CEO of Thermatix, Inc.
19The agreement for the first time defines the term subsidy and creates three categories of

subsidies: (1) prohibited subsidies; (2) subsidies that may be challenged in WTO dispute

settlement proceedings and domestically countervailed if they cause adverse trade effects; and (3)

nonactionable and noncountervailing subsidies, if they are structured according to criteria

intended to limit their potential for causing trade distortions. 

20Agreement on Subsidies and Countervailing Measures, Final Agreement Embodying the

Results of the Uruguay Round of Multilateral Trade Negotiations, part IV, article 8, 1994.

21Department of Energy, "Our Commitment to Change: A Year of Innovation in Technology

Partnerships" (Washington, DC: Department of Energy), Sept. 1994, p. 13.

22Linda Cohen, “Political Economy and Public Policy: When Can Government Subsidize

Research Joint Ventures? Politics, Economics, and Limits to Technology Policy,” American

Economic Review, Vol. 84, Issue 2, May 1994, pp. 159-163.

23Larry Reynolds, “Technology Policy Breeds New Era of Cooperation,” Management

Review, Jun. 1993, pp. 50-52.

32

against foreign subsidization.19 For example, under the General Agreement on Trade and

Tariffs (GATT), the U.S. Government can fund only up to 50 percent of the costs of

specific precompetitive development activity, defined as "the translation of industrial

research findings into a plan, blueprint or design for new, modified or improved products,

processes or services whether intended for sale or use, including the creation of a first

prototype that would not be capable of commercial use."20 In other words, Federal

funds can be used for first prototypes or models that cannot be used commercially, but

not specific direct funding of commercial-ready applications. However, due to such legal

constraints, government involvement usually stops short of direct commercialization

assistance. Technology is transferred and/or manufacturing problems are ironed out, but

the private sector bears responsibility for finding capital, researching markets, developing

business plans, advertising, and sales.

Despite these restrictions, government funding in precommercial stages can benefit

private industry and impact the U.S. economy as a whole, through expansion and

dissemination of basic science and knowledge, job creation, increased industrial output,

and improvements in energy efficiency and the environment. Congress and policy

makers are increasingly holding agencies to these goals, leading many agencies to

develop measures to track the benefits of technology transfer. For example, a recent study

looked at the economic benefits derived from many of the Department of Energy's

award-winning technologies developed from 1989-1992. The study found that, of the 113

technologies surveyed, 46 percent had transferred technology to the private sector; 10

percent resulted in a new company being formed; 52 percent have created jobs; 22 percent

have saved jobs; 12-24 percent have resulted in notable energy savings; and 20-40

percent have resulted in notable environmental improvements.21

However, policy makers, academia, and the private sector continue to debate the

proper role of government in R&D and the business arena, and the best way to achieve

government goals.22 Proponents of involvement contend that without increased

government funding of technology development, within constraints of the subsidies

agreement of the URA, U.S. industries are at a disadvantage and thus less competitive

globally. A contrasting view is that investment in and development of new

technologies should be driven by free market forces, and that government involvement

in the process may distort these decisions.23 Within the private sector, there are still

concerns regarding confidentiality and intellectual property rights (IPR) issues, 

the considerable time commitment required to determine which labs and facilities have the

capabilities and the desire to work with them, and the often complex process of
24Supplement, Budget of the U.S. Government, FY 1998: Chapter 4, “Promoting Research”;

and Supplement, Budget of the U.S. Government, FY 1997: Chapter 10, “Promoting Science and

Technology,” found at Internet address http://cher.eda.doc.gov/BudgetFY97/supp10.html,

retrieved on Nov. 18, 1997; and NSTC Executive Secretariat, “Accomplishments of the National

Science and Technology Council (NSTC): 1996,” found at Internet address

http://www.whitehouse.gov.WH/ EOP/OSTP/NSTC/html/1996, retrieved on Nov. 18, 1997.

251995 The Federal Research and Development Program in Materials Science and

Technology, A Report by the Materials Technology Subcommittee, Committee on Civilian

Industrial Technology, National Science and Technology Council, Executive Office of the

President, Office of Science and Technology Policy, Dec. 1995, p. ii. 

33

establishing a partnership. Any further redefinition of the government's role in

developing new materials and materials processing technologies also will be subject to

limitations outlined in the WTO and regional trade agreements.

The remaining articles in this staff research study discuss specific new manufacturing

processes for materials and advanced materials that can result from such processes. To the

extent available, information is provided on the status of global competitors, and the role

government initiatives and funding (including foreign government programs) have

played in the technology development process.

Recent Developments

The administration has identified investment in science and technology as an important

priority,24 and advanced materials and processing technologies has been one of several

elements of this policy focus. However, there have been changes in the Government’s

materials research and development (R&D) policy over the last 2 years, as other

science and technology priorities, such as information technology, space exploration, and

health research, emerged to dominate the national R&D agenda. The Government’s

previous emphasis on materials R&D has been affected by the policy re-direction

manifested in two forms: the elimination of a policy coordination committee and slightly

reduced funding to certain agencies carrying out materials R&D. However, the agency

carrying the largest budget allocation for materials R&D, the Department of Energy

(DOE), actually received a budget increase from FY 1994 to FY 1996, suggesting that

existing priorities have not been altered significantly.

In order to coordinate science, space, and technology policies across the Federal

Government, President Clinton established the cabinet-level National Science and

Technology Council (NSTC) by Executive Order on November 23, 1993. A stated

objective of the NSTC was the “establishment of clear national goals for Federal

science and technology investments in areas ranging from information technologies and

health research, to improving transportation systems and strengthening fundamental

research.”25 The importance of materials R&D was recognized as the NSTC established the

Materials Technology (MatTec) Subcommittee to coordinate Federal policy on materials

development. The MatTec Subcommittee, which consisted of representatives from nine
26These agencies include the Department of Commerce (DOC); Department of Defense

(DOD); Department of Energy (DOE); Department of the Interior (DOI); Department of

Transportation (DOT); Department of Health and Human Services (HHS); National Aeronautics

and Space Administration (NASA); National Science Foundation (NSF), and the U.S. Department

of Agriculture (USDA). The Environmental Protection Agency, which previously reported to the

CCIT, now reports its activities through the NSTC Committee on Environment and Natural

Resources.

27This was one of several committees that was established to foster improved Governmentindustry cooperation and facilitate technology transfer and commercialization of new

technologies. The others are Committee on Health, Safety, and Food; Committee on Fundamental

Science; Committee on Computing, Information, and Communications; Committee on

Environment and Natural Resources; Committee on Education and Training; Committee on

Transportation; Committee on National Security; Committee on International Science,

Engineering, and Technology. 

28Telephone conversation with Donald Hillebrand, Executive Office of the President, Nov.

21, 1997.

29Samuel Schneider, NIST, Executive Secretary, MatTec Subcommittee, Dec. 8, 1997.

30Data provided by Dr. Toni Maréchaux, DOE, Interim Chairman, MatTec Subcommittee,

Dec. 9, 1997.

31Telephone conversation with Andy Culbertson, DOD, Dec. 1, 1997. 

32Electronic mail message from W. Lance Haworth, National Science Foundation, Dec. 16,

1997.

33The seven industries are petroleum refining, chemicals, pulp and paper, steel, aluminum,

foundries, and glass.

34

Federal agencies,26 was overseen by the NSTC Committee on Civilian Industrial Technology

(CCIT).27 However, the NSTC eliminated the CCIT in early 1997. For a time, MatTec’s

activities were overseen by the Committee on Technical Innovation. However, there is

currently a reorganization taking place at NSTC, and the future status of the MatTec

subcommittee is unclear.28 

Significant Agency Activities

The Department of Energy (DOE) continues to represent about 80 percent of the

Government’s total materials R&D expenditures.29 Although funding for materials R&D

has been declining at a few agencies, DOE’s budget for materials R&D has actually

increased, from $623.7 million in FY 1994 to $726.9 million in FY 1996.30 The

Defense Department has the second-largest materials R&D budget; however, its

allocation has declined steadily since FY 1993, from $563 million to $449 million in FY

1997.31 The National Science Foundation, which carries the third-largest budget,

increased from $283 million in FY 1994 to $293 million in FY 1997.32

DOE supports the largest Federal materials R&D program of any agency, and industry

collaboration is a key element to its research. For example, DOE has played a major role

in the coordination of federal R&D addressing lightweight structural material for

automobiles working through both the Partnership for a New Generation of Vehicles

(PNGV) and the industry-led U.S. Automotive Materials Partnership. In addition,

through its Industries of the Future strategy, DOE’s Office of Industrial Technologies

(OIT) has identified seven industries for which it is seeking to assist in development

of materials that will improve process efficiency and/or products of increased value.33
34U.S. Department of Commerce, Technology Administration, “Guide to NIST,” p. 2.

35Other NIST labs involved in materials R&D are the Electronics and Electrical Engineering

Laboratory (EEEL), the Chemical Science and Technology Laboratory (CSTL), Building and Fire

Research Laboratory (BFRL), Physics Laboratory (PL), and Computing and Applied Mathematics

Laboratory (CAML).

36U.S. Department of Commerce, “Guide to NIST,” p. 10.

371995 Federal Research and Development Program in Materials Science and Technology, p.

46. 

38Ibid.

35

Other areas of focus include projects to develop high-strength, continuous-fiber

ceramic composites capable of operating at high temperatures, novel materials and

associated processing techniques for advanced turbine systems, and corrosion- and

oxidation-resistant intermetallic alloys.

The National Institute for Standards and Technology (NIST) of DOC and the Defense

Department both manage programs specifically geared to materials R&D. The mandate

of NIST is to promote economic growth by working with industry to develop and apply

technology, measurements, and standards.34 One of its eight laboratories, the Materials

Science and Engineering Laboratory (MSEL), is devoted entirely to materials R&D; its

director chairs MatTec. The MSEL carries out about 80 percent of NIST materials

R&D.35

NIST manages two major complementary programs that support cost-shared industry

R&D in key topic areas, including materials. The Advanced Technology Program (ATP)

is a cost-shared program that supports multiyear development of a broad spectrum of

high-risk, potentially high-payoff commercial technologies, including advanced

materials and material-dependent systems.36 Recent program developments have focused

on advanced ceramics and high-performance polymer-matrix composites, advanced

processing of materials, and materials characterization; 15 current projects focus on

manufacturing of polymer-matrix composites for large, commercial structural

applications, such as automobiles and bridges. New focus areas for the ATP include

materials processing for heavy industry.37

The other program managed by NIST is the Materials Extension Partnership (MEP),

which emphasizes NIST role in transferring developed technologies to small- and mediumsized businesses through Government-industry partnerships and extension services.

NIST’s 5-year technical plan calls for narrowing in on new, interdisciplinary topics with

“high potential for significant impact,” including: materials theory, modeling, and

computation; coatings and interfaces; metal-matrix composites; magnetic materials;

photonic materials; nanostructured materials; and precision machining of advanced

materials.38

Joint industry-Government cooperation plays a significant role in DOD materials

development programs, particularly through the Technology Reinvestment Program

(TRP), which is based at DOD Advanced Research Projects Agency (ARPA). The TRP

promotes development and deployment of new dual-use technologies for both civilian

and military applications. The program stresses cost-shared partnerships among

government laboratories, industry, and universities. TRP is a joint effort of six

agencies (DOC, DOD, DOE, DOT, NASA, and NSF) and is the largest multi-agency
39Ibid., p. 15.

40Ibid, p. 66.

41Hon. Constance A. Morella, Extension of Remarks in the House of Representatives upon

introduction of H.R. 2544, The Technology Transfer Commercialization Act of 1997, Sept. 25,

1997, found at http://thomas.loc.gov/cgi-bin/query/D?r105:1:./temp/~r105BPrR; retrieved on Nov.

19, 1997.

42HR 2544, Technology Transfer Commercialization Act of 1997, introduced in the House of

Representatives, Sept. 27, 1997, found at http://www.fedlabs.org/flc/ftpsrc/h2544.htm; retrieved

on Nov. 14, 1997.

43Ibid.

44Telephone conversation with aide to Congresswoman Constance Morella (R-MD), who as

Chair of the House Science Committee’s Technology Subcommittee, introduced the bill, as well

as P.L. 104-113, Nov. 19, 1997.

36

technology development program ever conducted by the Federal Government.39 Recent

areas of focus include materials processing improvements. For example, ARPA is

seeking to develop affordable manufacturing and fabrication techniques for costly

advanced structural materials, especially composites.40 

Legislative Initiatives

With regard to legislative initiatives, The National Technology Transfer and

Advancement Act of 1995 (Public Law 104-113) was enacted into law during the 104th

Congress. This law amends the Stevenson-Wydler Technology Innovation Act of 1980

and the Federal Technology Transfer Act of 1986, and is intended to improve U.S.

competitiveness by speeding commercialization of inventions developed through

collaborative agreements between government and industry. It specifically seeks to

promote partnership ventures with Federal laboratories and the private sector and creates

incentive in laboratory personnel for new inventions.41 

Following enactment of this law, Rep. Constance Morella (R-MD) introduced the

Technology Transfer Commercialization Act of 1997 (H.R. 2544) in September 1997.

The goal of H.R. 2544 is to remove the legal obstacles to effectively license Federallyowned inventions. The bill seeks to provide agencies with two new tools for effectively

commercializing federally-owned technologies--either licensing them as stand-alone

inventions, or including them as part of a larger package under a CRADA.42 Also, H.R.

2544 removes language requiring public notification procedures in the current law,

recognizing that speedy time-to-market commercialization is a critical factor for the

successful introduction of new products in a competitive marketplace.43 The bill has been

referred to the Intellectual Property Subcommittee of the Judiciary Committee and the

Technology Subcommittee of the Science Committee for consideration; hearings may

follow in early 1998.44
1Automotive News, 1997 Market Data Book, May 23, 1997, various pages.

2Derived from sales figures in Ward’s Automotive Yearbook, 1997, p. 126; and Automotive

News, p. 24.

3U.S. Department of Commerce, Motor Vehicle Division, “Drivers of the U.S. Automotive

Industry,” prepared by Albert T. Warner, director, Motor Vehicle Division, Feb. 27, 1996, found

at http://www.ita.doc.gov/ industry/basic/hondsp.html, retrieved July 8, 1997.

4For an analysis of the pros and cons of steel versus aluminum and plastic in automobile

manufacturing, see Frank R. Field III, and Joel P. Clark, “A Practical Road to Lightweight Cars,”

MIT Technology Review, Jan. 1997, found at http://web.mit.edu/techreview/

(continued...)

37

Alternative Materials in the U.S. Automotive

Industry Promote Development of Joining

and Bonding Technology

Susan H. Lusi

(202) 205-2334

slusi@usitc.gov

Joining and bonding technologies have changed as industrial

applications for nontraditional materials have expanded. For

example, the auto industry has increased its consumption of

lightweight materials over the past 20 years as fuel efficiency

standards increased and as auto makers responded by producing

lighter cars. As the polymer composite and aluminum content of

automobiles increased, so did the need for specialized joining

technologies. This article examines several joining technologies

currently under development that may offer auto makers a

competitive advantage as alternative materials make inroads into

the auto industry.

This article was originally published in the Industry, Trade, and

Technology Review of October 1997.

The U.S. automobile industry, the world’s single largest car and truck producer, accounted

for approximately 21 percent of global production in 1996.1 During that same year, the Big

Three U.S. auto producers captured 35 percent of worldwide sales,2 largely because of their

effective response to market and regulatory demands. Consumer expectations of higher

quality, increasingly stringent environmental standards, and heightened safety awareness

have raised the intensity level of competition in the market. U.S. producers have responded

by reducing costs and improving productivity (often through changes in manufacturing

processes).3

Auto producers employ many strategies to maintain their competitive position. One strategy

designed to meet environmental regulations is the substitution of lightweight materials for

steel and other metals.4 The U.S. automotive industry has increased the polymeric materials5
4

(...continued)

www/articles/jan97/clark.html, retrieved June 17, 1997. 

5Polymeric materials include all plastics and polymer composites. Plastic is a nontechnical

term for “resin system,” and polymer composites are resin systems that are reinforced with a

fibrous material in order to enhance mechanical and physical properties. Most auto parts that do

not have a load-bearing function are made of resin systems although the load-bearing parts must

be strong and are made with polymer composites. This article is concerned with the development

of joining and bonding methods for polymer composite load-bearing structures for automobiles,

such as frames. The term “plastic” will be used to refer to auto parts that are nonload-bearing

(such as dashboards) and are made of nonreinforced resin systems. 

6For details on the use of aluminum in the automobile industry see USITC, “Aluminum

Product Development and the Automotive Industry,” Industry,Trade, and Technology Review,

USITC, May 1994, pp. 17-25.

7CAFE standards were established in 1975 by the Energy Policy and Conservation Act. 

According to these standards, automakers are required to meet fuel economy ratings for each fleet

of passenger cars they produce. Since 1986, the fleet average has been 27.5 miles per gallon,

although industry officials anticipate a higher standard during the next several years. See the data

found at http://www.ita.doc.gov/industry/basic/cafe/html, after June 23, 1997.

38

and aluminum content of a typical family vehicle (table 1), particularly in applications for

nonload-bearing parts, e.g. plastic hoods, roofs, and side panels; and aluminum wheels,

brakes, air conditioning compressors, heat exchanger, radiators and engine blocks.6

Traditionally, these parts have been made of steel. 

Table 1

A typical family vehicle, material content and total weight

Material/ year

1976 1986 1996 1976-1996

 percent

Pounds change

Percent

of total Pounds

Percent

of total Pounds

Percent

of total

Iron and steel ................. 2,785.0 74.1 2,190.0 69.0 1,890.0 61.0 -32.0

Polymeric materials ............ 325.0 8.6 433.0 13.7 642.0 21.0 97.5

Aluminum .................... 85.5 2.3 139.5 4.4 257.0 8.3 200.0

All other ..................... 564.5 15.0 407.5 12.9 301.0 9.7 -47.0

 Total vehicle weight .......... 3,760.0 100.0 3,170.0 100.0 3,090.1 100.0 18.0

Source: Recent trends in automobile recycling: an energy and economic assessment, ORNL/TM/12628, March

1996.

As a means to limit emissions of carbon dioxide, and to meet corporate average fuel

efficiency (CAFE) standards,7 U.S. automobile manufacturers reduced the weight of the

steel portion of the average passenger car by 21 percent between 1976 and 1986. The

overall weight of the average car declined by 18 percent between 1976 and 1996. However,

nearly all of the reduction was achieved by 1986, when auto makers were producing fleets

in compliance with CAFE standards (table 1). Since then, the weight of the average car has

remained stable, mainly because of the combined effect of unchanging CAFE standards and

increased consumer demand for large accessory-laden vehicles.

 
8

“Transportation Technologies,” found at http:/www.ornl.gov/ornl/energy_Efficiency/

trans.html#ctp, retrieved Aug. 13, 1997.

9National Materials Advisory Board, Materials Research Agenda for the Automotive and

Aircraft Industries, NMAB-468 (Washington, DC: National Academy Press, 1993), p. 34. 

10Toni Marechaux, U.S. Department of Energy, Office of Transportation Technologies,

USITC staff interview, June 1997.

11 “Adhesive Bonding Technologies for Automotive Structural Components,” found at

http://www.ornl.gov/ orcmt/capabilities/dtin384.html, retrieved June 16, 1997. 

39

Since a 25-percent decrease in vehicle weight could save 13 percent in gasoline

consumption and reduce carbon dioxide emissions by 101 million tons per year,8

manufacturers are experimenting with further weight reductions by using alternative

materials for auto parts made of steel and other traditional metals. Alternative material

candidates include polymer composites reinforced with glass (25-35 percent of the weight

of steel), carbon fiber-reinforced polymer composites (50-65 percent of the weight of steel),

and aluminum (one-half of the weight of steel).9 Although CAFE standards have not

changed in recent years, auto manufacturers are developing process technology for

automobile production with lightweight materials.10 Manufacturers are more likely to

produce a vehicle with improved fuel economy once such technology becomes widely

available. A higher CAFE standard would push the development of this process technology

and lead manufacturers to increase their use of lightweight materials. 

The adoption of alternative materials can also reduce manufacturing costs. Material

properties (such as the temperature at which a material becomes malleable) are key

determinants of the processing and assembly methods, which directly effect productivity rate

and cost. For example, molded polymer composite auto parts cost less to manufacture than

stamped steel parts because complex shapes can be formed in one large mold. The process

requires less joining, bonding, and machining. Manufacturing costs are further reduced

because less labor is required to complete the process. The material switch may also affect

the speed of production because less time is needed to assemble consolidated parts.

Automakers are investing in research of joining and bonding technologies for alternative

materials. The lack of fully developed joining technologies is considered a barrier to the

utilization of advanced lightweight materials to form automotive structures.11 Traditional

means of joining steel parts--welding, brazing, and soldering--do not effectively bond

polymer composites, and adjustments to welding and brazing must be made to successfully

join aluminum. Mechanical fasteners continue to be a viable joining option, but they are

typically used in conjunction with another method. For example, adhesively joined polymer

composites may be mechanically fastened (either permanently or temporarily while the

adhesive bond sets). The ideal joining methods would have the capacity to bond both

similar and dissimilar materials, such as aluminum to steel, or polymer composite to

aluminum. One well-known consortium conducting research on joining and bonding

polymeric composites and aluminum auto parts is the Partnership for a New Generation of

Vehicles (PNGV), highlighted in the text box.
40

Partnership for a New Generation of Vehicles (PNGV)

Research on joining technology for automobile manufacturing is sponsored by private and public

collaboration, through the PNGV. The partnership was founded in 1993 between the U.S. Government

and the Big Three U.S. car makers to develop the automobile of the future. Each PNGV activity

contributes to one of the three goals that guide the program: 

# improve U.S. competitiveness in automobile manufacturing

# develop and apply new innovations to conventional vehicles

# develop a vehicle with up to three times the fuel economy of

conventional mid-sized sedans while maintaining current

performance, safety standards, and cost of ownership

The PNGV strategy to reach the fuel economy goal is the reduction of vehicle weight. The goal is

supported by a host of research projects on aluminum and polymer composites conducted in the national

research facilities and Big Three laboratories. Materials research, including the development of joining

technologies for alternative materials encourages progress toward this objective.

The 1996 PNGV report hailed several research projects on joining methods ‘significant technical

accomplishments.’ A project on adhesive bonding technologies for automotive structural components

was successful in creating standardized test methods to analyze the durability of bonded joints. Also, the

bonding of aluminum to composites and a material surface treating method to improve a bond was

addressed. The latter will soon be patented. A project on aluminum laser-welding led to the

development of a computer controlled process monitor. No joining technology developed under the

PNGV currently is used in the mass production of automobiles. 

Ultra-light Steel Autobody (ULSAB) program

The steel industry has mobilized to maintain one of its largest markets. The ULSAB program is a

international project initiated by the automotive industry (in this case European) and the steel industry

to develop a lightweight steel autobody structure. Its members include 35 steel makers from 18 countries.

The ULSAB has addressed the automobile industry’s need to reduce the average vehicle weight by using

a computer model to design a high-strength steel body and parts. 

Auto/Steel Partnership and European Aluminum Association

The Auto/Steel Partnership is a consortium of the U.S. Big Three vehicle manufacturers and major U.S.

and Canadian integrated steel mills. Twelve task forces conduct precompetitive research on

standardization, cost-reduction, and design issues. Three of the task groups research welding technology

and standards. The European Aluminum Association is also active in promoting the aluminum content

in European-made automobiles. 
12Research goals for the development of assembly and processing technologies such as

joining and bonding are outlined in Partnership for a New Generation of Vehicles, Report of

Workshop on Composite Vehicle Structures, Sept. 28, 1995, Detroit, MI. 

13The joining techniques described in this report are intended to bond load-bearing structural

auto parts made of aluminum or polymer composites. Joining techniques for load-bearing parts

require greater strength than techniques for joining interior nonload-bearing auto parts, such as

dashboards. 

14For additional information, see USITC, “Economics and Innovation Spur Shift from

Mechanical Fasteners to Adhesives and Sealants in Certain Automotive Applications,” Industry,

Trade and Technology Review, Aug. 1994. 

15“Joining Composites,” Machine Design, Sept. 14, 1995, p. 81.

41

Joining and Bonding

A portion of the research and development (R&D) on the future generation of vehicles is

focused on surmounting the difficulties associated with bonding polymer composites,

aluminum, and steel. More specifically, R&D is underway on less costly and quicker

assembly and processing methods (relative to traditional materials) for joining alternative

materials.12 Research in this area is critical to support the application of alternative

materials in the automotive industry.13 The joining technologies described below show

promise in facilitating the manufacture and adoption of structural auto parts composed of

polymer composites and aluminum. 

Although research on new joining technologies is underway, these methods are not yet

commercialized. The ability to predict the behavior of a joint is stalled to a large extent by

the lack of reliable nondestructive testing methods. Once reliable testing methods are

developed and the technology produces satisfactory results, one less obstacle will exist for

auto manufacturers who want to make composite and aluminum auto parts. The degree to

which the joining and bonding methods described below are adopted can become known

only as the auto industry gains greater experience with their application.

Adhesive Bonding

Adhesive bonding is the primary method for joining polymer composites, although metals

will also bond with adhesives. The auto industry consumption of adhesives already has been

increasing. Plastic has become the dominant material for interior auto parts. The change

in bonding technology lowered production costs as the manufacturing process was

streamlined and required fewer mechanical fasteners.14 Adhesive bonds are stronger due to

the wider distribution of load at the joint, unlike mechanical fasteners that are stressed at

a single point. Auto manufacturers have greater design flexibility with adhesive bonds that

have a smooth joint surface. No universal adhesive exists; an adhesive formula is chosen

based on the properties of the substrate, the function of the joint, and the environmental

conditions that the joint must endure. Three of the most common adhesives used to bond

composites are epoxies, acrylics, and urethane.15 

Aside from determining the best adhesive formula for a composite, a producer must have

effective assembly and processing technologies to implement the bonding method. The

joining technologies described below address two production challenges faced by the

consumers of adhesives; lengthy curing time required to set each bond, and the need to treat

the substrate surfaces before bonding. Although not technically joining technologies,
16Adhesives have been used in the automotive industry for years as plastics became the

materials of choice for nonload-bearing interior parts, in the 1970s and 1980s. For an analysis of

the adoption of adhesives in the auto industry see “Economics and Innovation Spur Shift,”

USITC, Industry, Trade and Technology Review, Aug. 1994. 

17C. David Warren, R. G. Boeman, and F. L. Paulauskas, “Adhesive Bonding of Polymeric

Materials for Automotive Applications,” prepared for the Proceedings of the 1994 Annual

Automotive Technology Development Contractors Coordination Meeting, Dearborn, MI, Oct. 24-

27, 1994. 

18Thomas T. Meek, “Adhesive Bonding via Exposure to Microwave Radiation and Resulting

Mechanical Evaluation,” prepared for the Spring Materials Research Society (MRS) meeting,

Apr. 1996.

19Warren, Boeman, and Paulauskas. 

20Estimates of costs savings associated with microwave curing treatment are not available. 

21Melissa Larson, “Quality Gets a Boost From Materials Science,” Quality, Nov. 1996, p. 32.

22Ibid.

23Estimates of costs savings associated with DEA are not available.

42

microwave curing treatment and laser ablation address these joining challenges.

Technologies that meet these challenges will offer auto producers a greater choice of

materials.16

Microwave Curing Treatment

The use of microwave radiation to hasten the curing process of polymer composites joined

by an adhesive bond has proven to be successful.17 Adhesives are conventionally cured with

thermal heat, but the microwave process can create an adhesive bond of equal strength and

performance in much less time.18 Microwave radiation requires one-third to one-quarter of

the time required to cure with thermal heat.19 Joining by microwave radiation enables

greater flexibility in the manufacturing process since, to a degree, a higher microwave

power shortens the required curing time. Reduced processing time leads to energy and labor

savings,20 an effect that not only improves the manufacturing process but also facilitates

wider adoption of composites and other alternative materials. Research and development

of microwave curing is currently sponsored by the U.S. Department of Energy (DOE) at Oak

Ridge and Los Alamos National Laboratories. 

Diffusion-Enhanced Adhesion (DEA) 

The DEA process was developed at the University of Delaware’s Center for Composite

Materials and was applied to the development of a composite armored tank vehicle capable

of withstanding extreme battlefield conditions. The joining process was used to bond a

composite gun projection platform to the body of the vehicle.21 As a polymer composite

layer is co-molded to the gun projection platform, a compatible epoxy adhesive is diffused

into the composite layer and a bond is formed. A DEA bond is extremely strong and

requires less equipment than traditional steel welding. DEA also requires low pressure, low

temperature, and minimal assembly, which translates into lower manufacturing costs.22

Another potentially cost-reducing aspect of DEA is the elimination of the need to pretreat

the composite surface.23 One difficulty associated with DEA is the length of time required

to make the bond. The auto industry is not likely to adopt a technology that slows

production. The U.S. Department of Defense funded the project, and reportedly there are

no commercialized applications of DEA in the auto industry.
24Estimates of costs savings associated with laser ablation are not available.

25C. David Warren, Felix L. Paulauskas, Ray G. Boeman, “Laser Ablation Assisted Adhesive

Bonding of Automotive Structural Composites,” project completion report, Oak Ridge National

Laboratory, Feb. 4, 1997.

26Ibid.

27“Light-weight Materials, III. Findings and Recommendations,” found at

http://www.pmi.princeton.edu /conference /future vehicles/lightweight.html, retrieved June 12,

1997; and “Research aims at better laser welding for aluminum auto parts,” press release, May

1996, found at http://www.anl.gov/opa/news96/news960509.html, retrieved Aug. 10, 1997.

28Compared to arc welding (electrical-current method), PNGV Technical Accomplishments,

July 1996, n.p. 

43

Laser Ablation

Contaminants on a material surface often inhibit the chemical bond of an adhesive so most

composite surfaces must be treated prior to bonding. Laser ablation is a surface treatment

that removes the contaminants on the composite surface and also some of the resin. This

creates a rough surface area as the fibers (carbon or graphite) characteristic of all reinforced

polymer composites are exposed. The resin surrounding the exposed fibers interface with

the adhesive, creating a joint that is resistant to cracks. The strength of the bond is

attributable to the large surface area contact created as the fibers of one part extend across

the joint and intermingle with the fibers of the other part. The production rate of structural

auto parts treated with laser ablation would likely increase because of the time savings

incurred by the elimination of surface treatment.24 Glass-fibers of reinforced composites are

inclined to split from the intensity of the laser beam, producing a weak bond. The technique

appears to work better on composites reinforced with carbon-fiber rather than glass-fiber.25

There is no commercialized technology of this type in the automobile industry, but extensive

research sponsored by DOE is conducted at Oak Ridge National Laboratory.26

Welding

Welding is one of the low-cost methods for joining aluminum. Auto manufacturers have

welded steel auto parts together for decades, but welding aluminum does require some

process modifications. As the aluminum content in automobiles has increased, alternative

welding techniques have become more important in the industry. Current research focuses

on the development of modified welding methods, process monitoring, and noninvasive

testing of welded joints.27 Welding techniques that enhance productivity and maintain or

improve product quality could lead to greater consumption of aluminum by auto producers;

two techniques, laser and advanced welding, are undergoing further development.

Laser Welding 

Laser welding is a promising method for joining aluminum, although the method works on

other materials such as ceramics. Aluminum is difficult to weld with traditional electricwelding techniques because, unlike steel, it is a high conductor of electricity. It is also

difficult to laser-weld because it is highly reflective and tends to scatter the laser beam.

Compared to several other alternative welding techniques, however, laser welding is fast,

precise, and requires less heat.28 One drawback of laser-welding equipment is its sensitivity

to contaminants commonly found in the automobile-manufacturing environment. Wider

application of laser welding is dependent upon a resolution to this difficulty and the
29Estimates of costs savings associated with laser welding are not available.

30PNGV Technical Accomplishments, n.p.

31Larson, “Quality,” Quality, p. 32.

32Estimates of costs savings associated with advanced welding are not available.

33ATP project brief, “Advanced Welding Technology for Structural Automotive Products,”

found at http://www.atp.nist.gov/www/comps/briefs/95020055.html, retrieved Sept. 30, 1997.

34Diffusion is a joining process whereby two flat surfaces are heat treated, causing the

molecules to intermingle and bond. 

35C. David Warren, program manager, Transportation Composite Materials Research,

Oakridge National Laboratory, Oakridge TN, and advisor to the Automotive Composites

(continued...)

44

technology must be refined to so that joint strength, assembly times, and cost meet the

standards and efficiencies already achieved for bonding steel components.29 The

development of process controls for laser welding to improve joint quality is conducted

under the auspices of PNGV by private companies and several national laboratories. The

progress of this research is marked by the development of an on-line weld monitor that can

detect surface features and other measures, as the joint is formed. A patent for the

technology is now pending.30

Advanced Welding

A manufacturing process designed to form and join preshaped aluminum and tubular steel

is under development by Dana Corp., an automotive-component parts supplier (Reading,

PA).31 The project supports automakers’ efforts to increase fuel efficiency by substituting

lightweight materials to achieve weight reduction of the load-bearing frames of cars and

light trucks. The process more precisely forms the load-bearing structures that reduces the

need for filler material to join parts. Preshaped aluminum or tubular steel is formed by

exposure to high pressure within very precise die cavities and then machined according to

a computer-aided design (CAD) file. The method has several advantages: dissimilar metal

substrates can be joined, the time required to cure the joint is minimal, and the process need

not be fixed to one area of the factory floor.32 The process makes the adoption of aluminum

a viable option for U.S. auto makers and its flexibility allows manufacturers to readily

respond to consumer demands. The manufacturing process is not yet commercialized, and

Dana Corp. is supported by the National Institute for Standards and Technology (NIST),

under Advanced Technology Program funding. 33

Other Bonding and Joining Technologies

Diffusion Bonding

This process was originally developed by an aircraft manufacturer and an aluminum

producer. Diffusion bonding is a combination of two distinct processes; first, complex

shapes are formed from a single piece of material, and second, materials are joined by

diffusion.34 The process relies on superplasticity, a property in which a material can become

extremely elongated without breaking. For example, aluminum alloy can be treated to take

on a superplastic property that facilitates the formation of complex auto parts. The number

of parts to join is reduced; for example, Big Three collaborative work on a composite

pickup truck bed of 20 pieces could replace a steel bed of 200 parts.35 After the parts are
35(...continued)

Consortium, USITC staff interview, Sept. 1997. 

36Larson, “Quality,” Quality, p. 30.

37Ibid.

38Ahmad Iftikhar, et. al. “Microwave Joining of SiC Ceramics and Composites,” proceedings

of the First World Congress on Microwave Processing, Orlando, FL, Jan. 5-9, 1997. 

39Ibid.

40Craig Saltiel, et. al. “Materials Processing with Microwave Energy,” Mechanical

Engineering, Aug. 1995, p. 102.

41“Joining Metals and Ceramics,” Machine Design, Sept. 14, 1995, p. 81.

42Ifikhar.

43Ceramics and Energy Efficiency, found at http://www.ornl/energy_eff/transp.html, retrieved

Aug. 13, 1997.

45

formed, the metals are bonded by keeping the base-metal microstructure intact at the joint

interface. The method works for dissimilar metals. Researchers claim that the combination

of superplastic forming and diffusion bonding combines the benefits of each to form a joint

of superior strength.36 The method leads to greater freedom of design, a potential for

energy-savings, and cost-effective manufacturing. However, the process takes time, which

is a major drawback for its application in the auto industry. Research on diffusion bonding

is underway at the Lawrence Livermore National Laboratory and is sponsored by the DOE.37

The technology is not yet commercialized.

Microwave for Ceramics

Ceramic is an alternative material for some automobile engine components. Ceramics are

lightweight and have the capacity to withstand very high temperatures; two qualities that can

help auto manufacturers reduce fuel consumption. Ceramic engine parts such as piston

heads and rotors allow the engine to run without a cooling system and with less fuel.

Although ceramic engine parts facilitate fuel efficiency, reliable joining methods are needed.

Microwave energy is one alternative to bonding ceramics by thermal heat, which requires

extremely high temperatures to work successfully.38 

Ceramics can be joined to composite materials by applying a microwave heating process.

As a joining technology, the microwave process forms an interlayer of active braze alloy and

successfully creates a bond between the ceramic engine parts and composite base material.39

The heating characteristics of ceramics are favorable to the creation of a high-strength bond;

the bond is formed from the inside out (the middle is heated from center and outward). The

bond also forms quickly due to the fast-heating microwave.40 Ceramics can also be joined

to metals with soldering and adhesive bonding.41 Microwave technology for joining

ceramics is not yet commercialized, although continuing research on the technology is

supported by the DOE and the Continuous Fiber Ceramic Composites Programs.42 Research

to expand the role of ceramics in automobiles is conducted through the Ceramic Technology

Project at Oak Ridge National Laboratory.43 

Outlook

As alternative materials continue to make inroads into the U.S. auto industry, demand will

increase for new manufacturing technologies and associated joining and bonding
44Thomas S. Moore, General Manager, Liberty and Technical Affairs, Chrysler Corp.,

“Making Composites Economically Competitive for High-volume Structural Automotive

Applications,” read at the Advanced Composite Conference and Exposition, Nov. 9, 1995.

45Since less alternative material is needed on a per-pound basis, the cost relative to steel is--

aluminum, 2 times; glass fiber-reinforced polymers, 1.5 times; and carbon reinforced polymers, 5

times. U.S. Congress, Office of Technology Assessment, Advanced Automotive Technology:

Visions of a Super-Efficient Family Car (Washington, DC: GPO) OTA-ETI-638, Sept. 1995, p.

62. 

46Ibid., p. 64.

47Auto makers currently do not demand a high volume of composite parts, and suppliers lack

capacity to produce a high volume. The rate of production of composite vehicle parts is slow,

roughly 15 minutes per part for liquid-molded composites, compared with 17 seconds to stamp a

steel part. Since these conditions have remained unchanged over the past several years, it is not

cost-effective to mass-produce polymer composite parts. OTA, Advanced Automotive

Technology; and USITC staff interviews with industry contacts.

48Warren, USITC staff interview, June 17, 1997.

46

technologies. Joining technologies for lightweight materials facilitate improved

productivity, lower manufacturing costs, and a more flexible manufacturing setup.

Adhesives and new welding techniques are a means to ensure greater design freedom for

manufacturers. More significantly, the joining technologies profiled in this article are likely

to contribute to the competitive advantage enjoyed by auto manufacturers of standard

passenger vehicles made largely of lightweight polymer composites or aluminum.

Several circumstances challenge the widespread adoption of lightweight materials by the

auto industry despite the need for continued improvements in processing technology. Some

particular circumstances are as follows:

C Material cost is the most significant barrier to the use of polymer composites and

aluminum in the auto industry.44 Carbon steel has a clear cost advantage. On a perpound basis, carbon steel is 4 times less costly than aluminum, 3 times less costly

than of glass fiber-reinforced polymer composites, and 20 times less costly than

carbon fiber-reinforced polymer composites.45

C While it may be possible to manufacture a polymer composite frame, the

technology to mass-produce load-bearing composite parts currently does not exist.46

C The automobile industry’s lack of demand for polymer composites does not inspire

suppliers to increase their production capacity.47 

C The lack of understanding of the nature and behavior of composites and other

advanced materials may delay the adoption of alternative materials in the U.S. auto

industry. Detroit does not have the design experience and familiarity with

advanced materials that exists in the aerospace industry.48 

C Nondestructive testing methods are needed to test the quality and reliability of

joints and bonds. 

Finally, the steel industry is working with the auto industry to develop better products and

reduce costs. The auto/steel partnership poses competition for composite and aluminum

suppliers who are vying for new business in the auto industry. Despite innovations such as
49Marechaux, USITC staff interview, June 1997; and OTA, Advanced Automotive

Technology, Sept. 1995, p. 63.

50Warren, USITC staff interview, June, 1997; and Field and Clark, “A Practical Road to

Lightweight Cars.”

51Warren, USITC staff interview, Sept. 1997.

47

ultralight steel, no type of steel is as lightweight as polymer composites or aluminum. These

alternative materials are more likely than steel to be chosen for the production of a

lightweight vehicle.

Despite some hindering circumstances, alternative materials potentially offer many

competitive advantages to the auto industry, including--

C The tooling cost for polymer composites is less than steel.49 A manufacturer must

sell 300,000 to 500,000 cars to recover the cost of the die for a steel frame. For

polymer composites, it is less than 50,000. 

C The similarity of aluminum to steel reduces the cost of retooling because aluminum

parts can be processed with some of the same equipment used to stamp steel. The

design of aluminum parts is also similar to that for steel, which is important in an

industry where consistency is valued highly.50

C The prospect of reducing emissions of carbon dioxide is perhaps the most valuable

result of the widespread adoption of lightweight materials by auto producers. 

Effective joining and bonding technology for alternative materials is a small but important

part of reducing the weight of the average vehicle. Joining and bonding methods are

“enabling technologies.” These enabling technologies always provide a benefit. In this

case, new joining and bonding technologies allow for the wider use of lightweight materials

in the manufacture of automobiles. Although not central to a material choice, without

effective joining and bonding methods, material choice is limited. The benefit accrued to

auto manufacturers who adopt new joining and bonding methods is not cost-related at this

point, since reinforced composites and aluminum are currently more expensive than steel.

However, according to one source, there is a measurable environmental benefit associated

with the adoption of lightweight materials. By comparing the material content of a 1996

typical vehicle referred to in table 1 with a passenger vehicle made largely of composites,

the latter would generate 400 to 500 pounds of scrap after a 15-year life span and would

produce 3,000 to 4,000 pounds less of particulate matter, a source of air pollution.

According to this industry official, buried composite scrap is stable and less harmful to

humans and the environment than the particulate matter released by an average vehicle not

reduced in weight.51

Many technologies profiled in this report are not yet commercialized. It is widely agreed

among auto industry officials, however, that the next generation of vehicles will be made

largely of aluminum and a subsequent generation will be made of polymer composites. As

this material shift occurs, demand for reliable joining technologies that are adaptable to

large scale auto production will increase. Continued research and development therefore,

appear ensured for joining and other enabling technologies that support alternative materials

in the automobile industry.
1Most steelmakers today use a form of continuous-strand casting. Molten steel (produced in

the furnace shop) is poured into one end of the continuous strand casting machine and is cooled,

forming a metal skin around a liquid core (i.e., the molten steel solidifies from the outer cooled

surfaces inward during the casting process) and a rectangular piece of steel is withdrawn

downward from the bottom of the mold. At regular intervals, sections of the cast-steel strand are

cut off, forming the semifinished product. This semifinished product is the raw material input for

the hot-rolling mill, the subsequent process in a steel mill.

48

Thin-Slab Casting/Flat-Rolling: New 

Technology to Benefit U.S. Steel Industry

Charles Yost

(202) 205-3432

yost@usitc.gov

Recent efforts to further develop and expand the role of thin-slab

casting in the steel industry are highlighted. This process,

combined with direct hot-rolling, greatly reduces capital

investment and operating costs of producing hot-rolled carbon

steel sheet. This article examines factors influencing adoption and

commercialization of this technology, which has encouraged socalled “minimills” to enter the flat-rolled segment of the steel

industry, until recent years the province solely of integrated steel

producers.

This article was originally published in the Industry, Trade, and

Technology Review of October 1996. The update in the

concluding section examines recent developments in the steel

industry to develop and expand the role of thin-slab casting in the

production of flat-rolled steels. Companies adopting this

technology have experienced different degrees of success in

achieving full production capacity, but incremental improvements

have advanced the technology, resulting in a second generation of

thin-slab casters. 

Certain recent and cumulative changes in steel casting and rolling,1 called thin-slab

casting/flat-rolling technologies, have lowered market-entry barriers, and have allowed the

production of flat-rolled steel products (plate, sheet, and strip) in significantly smaller plants

but with cost and quality benefits both to producers and to consumers. By altering cost

structures, this technology has led to changes in steel industry market structure, and it may

improve the international competitiveness of products the U.S. flat-rolled steel industry

segment produces. This large market accounts for approximately 60 million metric tons of

domestic shipments, and is a potentially lucrative source of revenues and profits to the costefficient producer.
2Steel sheet is produced in a series of batch processes in an integrated steel mill: coke

(produced from hard coal in coke ovens) is combined with iron ore and other raw material inputs

in a blast furnace to produce molten iron and then refined in a basic oxygen furnace to produce

steel. The liquid steel is then formed in a continuous-strand casting machine or ingot-casting

molds into semifinished forms (called slab). Slab is usually inventoried and allowed to cool, but

must be heated in a reheat oven to the proper temperature prior to being converted into flat-rolled

products on the hot-strip mill. The resulting hot-rolled sheet may be cold-rolled and coated in

subsequent processes.

3Minimum efficient scale of a plant refers to the smallest plant, measured by output or

production capacity, for which economic production can be undertaken. Cost-size relationships

are important in examining industry structure because, for many industries, increases in plant size

lead to decreases in average cost. The cost necessary to achieve economies of scale may pose a

barrier to market entry, or limit the number of firms in the industry. Several studies that estimate

scale economies in the U.S. integrated steel segment suggest the minimum optimal size of

conventional mills is 6 million net tons annually. For a recent study, see Robert P. Rogers, “The

Minimum Optimal Steel Plant and the Survivor Technique of Cost Estimation,” American

Economic Journal, Sept. 1993, vol. 21, No. 3, pp. 30-37.

4Steel is typically produced in a “minimill” by refining steel scrap in an electric arc furnace. 

The molten steel is poured through a continuous-strand caster to produce semifinished products

(usually, blooms and billets), that are hot-rolled on bar and rod mills. The steelmaking process in

a minimill bypasses the coke-making and iron-making route, and the blooms and billets that enter

the hot-rolling mill are typically smaller and lighter in weight than a slab. These differences along

with the smaller scale of operations account for the smaller investment required for construction

of a minimill and its lower operating cost, compared with an integrated mill. Significant advances

in the technologies of electric arc steelmaking, secondary refining, and continuous-strand casting

have allowed such minimills to increase in average production capacity, to begin producing thinslab and flat-rolled products that had been largely restricted to integrated producers.

49

Integrated steelmakers have dominated the flat-rolled steel market.2 The capital costs of

building a 3-million to a 6-million-ton-per-year integrated steel mill (the estimated minimum

efficient scale3 ) are estimated at more than $1,000 per annual ton of production capacity,

which comes to about $4 billion to $5 billion per steel mill. This cost and the investment

risk preclude the construction of “greenfield” integrated steel mills in the United States

(none has been built since the 1960s), although considerable modernization of existing

“brownfield” facilities has taken place. In contrast, a minimill4 that produces thin-slab/flatrolled steel can be constructed for about $200 per annual ton of capacity (equivalent to $400

to $500 million per mill), and it incurs lower operating costs (about 10 percent) in the

production of steel sheet and coiled plate.

The shift toward small-scale technology is driven in large part by significant capital cost

advantages of small-scale economies for producing many steel products. Even for existing

plants, the annual reinvestment requirements are lower for smaller facilities. These

economies--combined with Nucor Corp. (United States) operating success after installing

the world’s first thin-slab caster at a greenfield minimill--convinced five other companies

to adopt this technology. The cumulative capacity of these eight thin-slab/flat-rolled mills

may reach 16 million metric tons by 2000, and represents a significant increase of

production capacity in this market segment that will likely affect U.S. imports and other

domestic producers. In addition, three integrated U.S. steelmakers have selected thin-slab

casting to replace obsolete ingot-casting facilities at brownfield sites.
5Slabs are rolled to produce flat-rolled products including sheet, while blooms and billets are

rolled to produce long products, including bar, rod, rails, and structurals. These semifinished

products differ in terms of their dimensions, weight, the type of equipment needed for their

processing, and their intended applications. 

6Technological change is both incremental and continuous. The accumulation of incremental

improvements or modifications to existing capabilities appears to be accelerating, and compresses

the time frame for adopting and implementing new technology. An example is provided by

thin-slab casting--in less than 10 years thin-slab casting progressed from an improved concept to

full commercialization, and has nearly become a standard greenfield plant configuration.

7

 Dimensions are approximate, but the heavy slab measures about 8 inches to 12 inches thick,

6 feet to 8 feet wide, and 20 feet to 35 feet long. Slab thickness in thin-slab casting is typically

about 2 inches but may range up to 4 inches or 5 inches in some versions. 

8

 Estimates are for modernizing a brownfield site (existing mill) and construction of these

facilities at an integrated mill on a greenfield (new) site. World Steel Dynamics (PaineWebber),

Core Report ZZ, Dec. 1995, p. 14. For additional cost estimates see, Fr. William T. Hogan, S.J.,

Minimills and Integrated Mills: A Comparison of Steelmaking in the United States (Lexington,

MA: Lexington Books, D.C. Heath and Co., 1987), p. 115.

9

 Ibid. Also see, Richard Preston, American Steel: Hot Metal Men and the Resurrection of

the Rust Belt (New York: Prentice Hall Press, 1991), pp. 92-102. According to one industry

executive, a 1.5-million-ton-per year sheet mill (including steel melt shop with casting and rolling

facilities) can be built for about $300 million ($200 per annual ton of capacity), down from as

much as $500 million 5 years ago. Martin Farricker, “Stepping in Gopher Holes Teaches ThinSlab Lessons,” American Metal Market, Electric Furnace Steel Supplement, Feb. 14, 1996, p.

19A.

50

Thin-Slab Casting Processes

Significant reductions in minimum-efficient scale in the steel industry have occurred,

brought about by better continuous casting technology that altered production of

semifinished shapes (slabs, blooms, and billets).5 These improvements, combined with

certain others and with process linkage, simplified the economic production of steel

products at significantly smaller plants, thereby lessening the capital needed to generate a

dollar of sales.

Thin-slab casting technology evolved from continuous-strand slab casting, a process that

was commercialized in the 1950s and which now accounts for more than 90 percent of total

steel production in the United States.6 Differences between thin-slab casting and

conventional continuous-strand slab casting include the shape of the casting mold, the

desired thickness of the slab, and the linkage of steel casting with direct hot rolling. The

conventional continuous-strand slab casting technology produces a heavy slab7 at a

minimum of 8 inches thick. The capital investment required for this equipment and for the

hot strip mill to roll the slab into sheet is high--on the order of $500 million to $1.5 billion.8

In contrast, the thin-slab casting process makes a steel slab of about 2 inches thick with a

much lower investment in the caster and rolling mill--approximately $150 million to $300

million.9 This savings of investment and fixed costs is achievable because of two facts: (1)

a thinner slab eliminates the need for primary breakdown in the hot-strip mill (enabling hotrolling in the finishing stands of a conventional hot-strip mill); and, (2) the equipment

needed to continuously cast a 2-inch thick slab is far less extensive than required for a

conventional 8-inch or thicker slab.

Steelmakers adopting thin-slab casting also have tended to change plant configuration to link

the caster with the hot rolling mill, and the slab immediately is rolled after casting. This
10These three companies are exceptions to the majority of other integrated steelmakers that

have installed conventional continuous-strand casting equipment. See discussion later regarding

reasons for adopting this technology.

51

change in configuration reduces the capital costs of slab handling equipment, and reduces

the operating costs associated with reheating slab and maintaining slab inventories.

However, steelmakers and consumers initially voiced concerns that steel sheet rolled from

thin-slab casters would not possess desired formability and surface quality that would limit

its use to less demanding applications. Another factor limiting application is posed by the

maximum 60-inch width of such sheet (a maximum 80-inch wide sheet is produced by

integrated mills).

There are currently six thin-slab casting versions that have been commercialized (shaded

box). Although SMS Schloemann-Siemag is the dominant supplier of thin-slab casting

machines, other equipment manufacturers have had success. Steelmakers and equipment

manufacturers have relied on experience to create a second generation of thin-slab casters

that include improved features such as electromagnetic braking, liquid-core slab reduction,

and the capability to change slab thickness without downtime (termed by some as “flexible

thickness” thin-slab casting). These enhancements have improved thin-slab cast sheet

surface quality and, combined with further improvements in other aspects of steelmaking,

allow producers of thin-slab cast sheet to move into more demanding market niches served

by U.S. and foreign integrated steelmakers.

Commercialization of Thin-Slab Processes

Since the mid-1980s, foreign equipment manufacturing companies and steelmakers in the

private sector have developed thin-slab casting processes. Nucor Corp. commercial success

with the first thin-slab caster (CSP design) installed at a greenfield minimill in 1989, has

encouraged construction of more thin-slab casting facilities in the United States (table 1) and

abroad. Approximately 20 companies worldwide have adopted or plan to adopt one or a

combination of thin-slab casting technologies. The majority are in the United States, but the

remainder are spread in Canada, Mexico, Japan, Korea, Malaysia, Thailand, China, Turkey,

Czech Republic, and Italy. Each of the U.S. greenfield plants is a scrap-based electric

furnace steelmaking operation (minimill) that has an actual or planned production capacity

that exceeds 1 million metric tons annually (the majority plan for an expansion of

production capacity to 1.5 to 2 million metric tons). In several instances in the United

States, a traditional integrated company has formed a thin-slab minimill joint venture with

an existing minimill company (e.g. Dofasco and Co-Steel, and BHP and North Star). Also,

several U.S. integrated firms that currently operate coke-making, iron- and steelmaking

facilities have adopted thin-slab processes, replacing obsolete ingot casting technology10 and

reducing production costs (table 1).
52

Commercialized Thin-Slab Casting Processes

# Compact-Strip Production (CSP) is based on casting technology developed by SMS

Schloemann-Siemag (Germany). A 50-millimeter (approximately 2 inches) thick slab is

cast, which is then passed through a tunnel “equalizing furnace” and “hot-charged” into

the finishing stands of a conventional hot-strip mill. CSP was the first thin-slab casting

technology to be commercialized and is the most widely used process worldwide.

# In-Line Strip Production (ISP) was developed by Arvedi (Italy) and Mannesmann Demag

(Germany). The as-cast 60mm slab is “soft” reduced to 40mm thickness by a set of rolls

located below the mold, then the fully solidified slab is reduced to a 15mm-thick sheet by

three shaping stands. ISP was commercialized at the Arvedi plant in Cremona, Italy. A

similar casting-rolling process has been developed by Danielli (Italy) which also uses

liquid core reduction (in use at Nucor, Hickman, AR and Algoma Steel, Canada). 

# The Continuous Casting and Rolling (CONROLL) process was developed by VoestAlpine (Austria). Slab thickness can be varied between 75mm to 125mm (3 to 5 inches

thick); the slab is processed through a re-heating furnace (similar to the equalizing

furnace) and channeled directly into the existing hot strip mill consisting of a roughing

stand and six finishing stands. This was installed for use at Armco’s plant in Mansfield,

OH, and the existing plant was reconfigured to minimize process discontinuities between

caster, reheat furnace, and rolling mill. This process does more hot-rolling (i.e., a greater

amount of reduction in thickness is achieved in hot-strip mill) compared with CSP or ISP.

# The SMI process was developed by Japanese equipment makers Sumitomo Heavy

Industries and Mitsubishi Heavy Industries. Slabs will be cast to a thickness of 90 mm but

reduced to 70mm using liquid core reduction techniques (similar to the ISP process),

channeled through a tunnel equalizing furnace into a hot strip mill with two roughing and

five finishing stands. The SMI process reportedly is being installed at Trico Steel in

Decatur, AL. Like CONROLL, more hot-rolling is performed in the SMI process

compared with CSP or ISP.

# The Tippins-Samsung Process (TSP), named for the two equipment manufacturers,

produces a variable thickness slab from 75mm to 150mm (3 to 6 inches) that is channeled

through a reheat furnace to a two-stand reversing hot-strip mill. Reportedly, this design

allows the production of plate up to 120 inches wide, good surface quality, and potential

production capacity of between 1 and 2 million metric tons, at a cost of about $300

million. According to industry sources, it might be installed at Nova in Czech Republic.

# The Ultra Thin Hot-Strip (UTHS) process is being developed by Mannesmann Demag

(Germany) and Chaparral Steel (United States), reportedly is to be installed at Natsteel,

Singapore. A 90mm thick (3.5-inch) slab is cast, followed by breakdown rolling and

finishing rolling down to below 1 mm thick.

 Source: Compiled by staff of the USITC from various industry publications.
53

Table 1

Thin-slab production capacity installed and announced in the United States, by company, facility location and

process, capacity, and year expected to become operational

Company Facility location/process Capacity1

(Million metric tons)

Year2

Greenfield minimill plant construction

Nucor Crawfordsville, IN/CSP 1.0 + 1.0 1989 & 1994

Nucor Hickman, AR/CSP&ISP 1.2 + 1.0 1992 & 1994

Gallatin Steel3 Ghent, KY/CSP 1.2 + 0.9 1995 & mid-1997

 Tuscaloosa Steel4 Tuscaloosa, AL/SMS 0.9 1996

IPSCO5 Muscatine, IA/ISP 1.3 + 0.2 1996/97

Steel Dynamics Butler, IN/CSP 1.0 + 1.0 1996/98

Nucor Charleston, SC/CSP 1.0 + 0.6 1997/98

Delta Steel6 Delta, OH/SMI 1.6 + 1.0 1997/99

TRICO7 Decatur, AL/SMI 2.1 1997/98

 Total 9 facilities 11.3 - 17.0

Brownfield integrated plant modification

Geneva Steel Provo, UT/TSP 1.9 1994/95

Armco Steel Mansfield, OH/CONROLL 0.7/1.1 1995

Acme Steel Riverdale, IL/CSP 0.9-1.8 1996

1

 Announced raw steel melting capacity in million metric tons; initial steel melting capacity plus planned capacity additions (phase-II

additions).

2

 Start-up date(s) of initial installation and additional capacity (phase-II additions).

3 Joint venture between Dofasco and Co-Steel, Canadian steelmakers.

4

 A stand-alone rolling mill prior to installation of electric-furnace melting and medium-slab (5 inches) casting capability in 1996 that

increased capacity by 300,000 tons.

5

 Canadian producer of pipe. 

6

 Joint venture between North Star Steel (a Cargill subsidiary) and BHP (Australia).

7

Joint venture among LTV, Sumitomo (including the trading company, Sumitomo Metals, and Sumitomo Heavy Industries, the

equipment manufacturer), and British Steel.

Source: Based on various industry publications and USITC staff telephone interviews with industry officials.

Factors Aiding or Hindering Adoption of Thin-Slab Casting

The reasons that companies have adopted thin-slab casting provide insights into corporate

strategy and changes in industry structure. The adoption of technology often forms part of

a firm’s overall competitive strategy, and contributes to that strategy through its effect on

financial and operating costs as well as the company’s decisions regarding product mix,

markets served, and pricing. Factors that influence the decision to adopt a technology and

its timing may be tangible, or quantifiable, such as indicators of company financial or

economic performance; and intangible, such as the risk-posture of the company’s corporate

culture, as summarized in table 2.

Among the performance factors spurring the adoption of thin-slab casting technology has

been the lower costs of capital investment and operations that are achievable for the

production of flat-rolled steel sheet and strip compared with conventional integrated

Table 2
11There are two sources of large-scale economies in an integrated steelmaking plant: these are

the integration of iron-making and steelmaking operations and the hot-strip mill, which is used to

roll all continuous-strand cast slab into hot-rolled band. Engineering estimates of minimum size

range upwards from 5.4 million metric tons of annual raw steelmaking capacity. F.M. Scherer

and David Ross, Industrial Market Structure and Economic Performance, 3d ed. (Boston:

Houghton Mifflin Co., 1990), p. 102. The minimum efficient scale for a conventional continuous

hot strip mill is estimated at 2.7 million metric tons per annum. Robert W. Crandall, The U.S.

Steel Industry in Recurrent Crisis: Policy Options in a Competitive World (Washington, D.C.:

The Brookings Institution, 1981), p. 11. In contrast, new mini-flat-rolled mills typically possess

an initial capacity of about 1 million metric tons with a planned increase to about 2 million metric

tons, making them on average, less complex and smaller than their integrated steel mill

competitors.

54

Certain tangible and intangible factors guiding company adoption of thin-slab casting technology

Element Argument for adoption Argument against adoption

Tangible factors

Financial or

economic

performance

May lower operating costs through

increased productivity or may decrease

energy consumption.

May improve quality of company’s

products or product mix (allow the

company to produce increasingly

technically sophisticated and value-added

products).

Existing technology may embody sunk

costs; new costs may have unfavorable

impact on certain capital ratios.

May encounter lengthy learning curve

adjustment period (possibly several years)

to achieve product quality required by

markets served.

Capital costs may be higher than expected

rate of return; amount of investment capital

available to industry or company may be

limited.

Technological May embody state-of-art, yielding

enhanced flexibility in using raw materials

or other inputs, productivity increases, or

quality enhancements. 

“Best fit” usually is in a greenfield facility

and retrofit may not be appropriate for

scale production economies or other

reasons. Existing equipment may possess

lengthy remaining economic life. Effect of

new technology may be lessened by

subsequent technological advances.

Industry structure May reduce minimum economic scale, and

ease entry; lucrative rewards may accrue

to first innovator and market entrant. 

Entry costs may remain high or

unbridgeable; market strategies of existing

players or later entrants may negate

potential returns. Company already may

be in market segment. Successful

commercialization may encourage copycat

imitations, reducing or eliminating

advantages to the first innovator.

Intangible factor

Corporate culture May see existing market structure or

competitors as vulnerable to new entrants

(risk-taking and receptive to innovation).

Approach to decision-making is riskaverse or risk-neutral; may be receptive to

innovative technology, but adopts

conservative wait-and-see posture.

Source: Compiled by staff of the USITC from various industry publications.

steelmaking. The capital costs of a greenfield integrated mill11 have been illustrated earlier

as significantly higher when compared with the costs of a thin-slab/flat-rolled minimill. In
12 Reportedly, total manufacturing costs will decrease by 20 percent; processing time will

decrease; finished product yield (the ratio of finished product to raw steel produced) will increase

from 78 percent to 91 percent; energy requirement per ton of steel will decrease by about 46

percent; and manpower requirements per ton of steel are projected to fall by more than 50 percent. 

“Acme Steel Introduces the Minigrated Mill,” Purchasing, July 11, 1996, p. 46.

13 Preston, pp. 90-100. For a discussion of the relationship between entrepreneurship and

technology adoption, see Peter F. Drucker, Innovation and Entrepreneurship: Practice and

Principles (New York: Harper & Row, 1985), pp. 66-75.

14For example, World Class Processing (a steel finisher with a stand-alone rolling mill)

announced it had decided not to proceed further with its plans to install steel melting capacity and

thin-slab casting.

55

addition, trade sources indicate that construction costs and interest charges that accrue over

the several years needed to bring an integrated plant on-line would render the average total

costs of a new plant higher than costs at existing “best practice” integrated plants. However,

retrofitting an existing integrated plant is still an option. For example, Acme Steel installed

a CSP thin-slab caster to replace obsolete ingot casting because of cost, quality, and

productivity benefits.12 The potential difficulties of dovetailing thin-slab casting (or other

“incremental technologies”) with existing processes apparently have been minimized for the

three steelmakers (table 1) that have done so. For other steelmakers that possess continuousstrand casters, retrofitting may not be an appropriate option for reasons of economic

performance of their existing equipment and the technical needs of their customers. 

When Nucor Corp. chose to be the first producer worldwide to adopt CSP thin-slab casting

(and to build the first greenfield flat-rolled mill in the United States in nearly 30 years), it

reportedly resulted from a perception that thin-slab casting provided a means of market entry

to exploit a market opportunity.13 Nucor’s reported success and profitability has encouraged

more market entrants, although increased prices for casting equipment and falling prices for

hot-rolled band (the immediate downstream product produced by rolling thin-slab on a hotstrip mill) may have deterred some companies from considering expansion into the flatrolled segment.14 A comparison of estimated capital and operating costs for integrated mills

producing flat-rolled products with a recently built thin-slab/flat-rolled mill is in table 3.

Table 3

Estimated capital cost and operating cost for a greenfield conventional integrated mill, modernized integrated

mill, and thin-slab/flat-roll minimill in the United States, by process, 1995.

(Dollars per metric ton1)

Process

Greenfield conventional

integrated mill Modernized integrated mill Thin-slab/flat-roll minimill

Capital cost Operating cost Capital cost Operating cost Capital cost Operating cost

Iron-making2 1,160 130-140 (3) 130 (3) (3)

Steelmaking4 530 -1,134 185-200 290 185-200 125-130 180-185 (5)

Slab casting6 275 - 435 215-225 200 220-230 60- 80 200-215

Hot strip7 1,000 250-260 290 260-280 200-220 225-235

Cold-finishing8 700 350-380 (9) (9) 75 270-280
15Projection based on capacity estimates by industry sources as noted in table 1.

16 One industry analyst estimates that integrated mills will close 3 million to 6 million metric

tons of basic oxygen furnace-steelmaking capacity by 2000. This is in large part due to the

closure of obsolete coke ovens and supply tightness in the coke market. World Steel Dynamics

(Paine Webber), Capacity Monitor, Apr. 1996, p. 3.

56

 Total 3,670 -5,000 (3) 680 (3) 460-505 (3)

 

1

 Per metric ton. Capital costs are per ton of capacity per facility within a steel plant. Operating costs are the per ton cumulative

product costs at that stage of the production process, but do not include financial costs like depreciation, interest, and taxes.

 

2

 Includes approximately $450 per mt in capital costs for sintering (iron ore preparation) and coke-making facilities, and $720 million

for a 3.6 million metric ton blast furnace.

 

3

 Not applicable.

 

4

 Steelmaking costs for the greenfield integrated mill are based on about 4.4 million metric tons capacity (about $120 per metric ton

of capacity); on about 3 million metric tons capacity (about $220 per metric ton of capacity) for the modernized integrated mill; and on

2.0 million metric tons capacity ($60 per tonne of capacity) for the mini-flat-rolled mill.

 

5

 These costs may vary with changes in prices for raw material inputs (e.g., scrap and other iron-bearing materials). It should be noted

that a greater percentage of the production costs of a minimill vary with the business cycle. 

 

6

 Conventional slab is approximately 8 inches thick. Thin-slab is approximately 2 inches thick.

 

7

 Costs include reheat furnace, primary breakdown mill and finishing mill in an integrated mill; minimill costs include a tunnel furnace

and hot strip mill finishing stands. Product compared is hot-band.

 

8

 Includes costs for a “pickle” (acid clean) line, tandem mill, annealing, and temper mill. Product compared is cold-rolled sheet,

tempered, and finished.

 

9

 Not available, but assumed to be similar with the cost structure of a greenfield conventional integrated mill. Depending on the

circumstances, may not be applicable.

Source: World Steel Dynamics (PaineWebber), Core Report ZZ, Dec. 1995.

Competitive Effects of Process Commercialization and

Outlook

The expansion of production capacity and output by greenfield flat-rolled steel minimills

has spurred increased price competition within the flat-rolled steel segment, and the new

entrants have gained market share at the expense of both imports and established domestic

producers. Shipments from greenfield thin-slab/flat-rolled plants in the United States are

estimated to increase from about 2 million metric tons (accounting for nearly 5 percent of

U.S. producer shipments of flat-rolled steel products) in 1992 to about 16 million metric

tons (about 25 to 30 percent of shipments) by 2000.15 The increased production from thinslab/flat-rolled mills has contributed to more intense price competition as prices of hotrolled sheet declined by 15 percent during 1994-95 and remained at relatively low levels

during early 1996. The price difference between hot-rolled and cold-rolled sheet also

narrowed as several thin-slab cast minimills began selling hot-rolled sheet in thinner gauges

that heretofore were only achievable on an integrated steelmaker’s cold-rolling mill.

Reflecting these developments, U.S. imports of commercial grade hot-rolled sheet and

coiled plate have declined by 24 percent between 1994 and 1995, and by 30 percent during

January-May 1996, when compared with imports during the same period in 1995. 

These market conditions have placed competitive pressures on several of the higher cost

U.S. integrated producers either to reduce costs, to move into more sophisticated niche

products, or to exit the market segment for commercial grade hot-rolled sheet. Reportedly,

some steelmaking capacity will be closed by integrated steelmakers,16 which is expected to

increase the market share of thin-slab/flat-rolled mills. According to industry estimates,

about two-thirds of the total flat-rolled product market in the United States (between 30
17 World Steel Dynamics (PaineWebber), Core Report ZZ, “Steel’s Thin-Slab/Flat-Rolling

Revolution: Provoking Change, A Study of Steel Dynamics, Inc.,” Jan. 1996, p. 15.

57

million to 35 million metric tons)17 may be within reach of thin-slab/flat-rolled mill

operations, with the greatest increases in market shares accruing to hot-rolled sheet and hotdipped galvanized sheet. Smaller market share increases are expected in other categories

of coiled plate (in the thinner gauges of this product) and cold-rolled sheet. Continued

improvements in surface quality and formability should allow thin-slab/flat-rolled minimills

to increasingly penetrate the domestic market for sale to original equipment manufacturers

(OEM) such as automotive and construction equipment, who have tended to purchase

primarily from U.S. integrated steelmakers on a contract basis (usually a 1-year cycle).
18Scott Robertson, “Nucor May Target Plate Rivals,” American Metal Market, Oct. 15, 1997,

p.1; see also, Rick Teaff, “Ipsco Mulls 2d Plate Mill in U.S.,” American Metal Market, Oct. 9,

1997, p. 1.

19These estimates are for shipments made by Nucor (three facilities), SDI, Gallatin, Trico,

Delta, and Ipsco. PaineWebber, World Steel Dynamics, Steel Order Track, Oct. 22, 1997, p. 7.

20PaineWebber, World Steel Dynamics, Steel Order Track, Oct. 22, 1997, p. 3.

21"Moving Up With DRI and Thin-Slab Casting,” NewSteel, Aug. 1997, pp. 63-74. Ford

Motor Co. announced its intention to purchase 7,500 metric tons per month of steel sheet from

these new mills in 1998. See, “Mini-Mills Moving Up,” 33 Metal Producing, Jan. 1998, p. 34.

22The length of time needed to gain operating experience (and related learning curve

economies) and the complexity of the company’s product mix are important factors; there usually

is a lengthy time period between commissioning a mill and its initial commercial shipments, as the

equipment is tested and personnel are trained. Prior management experience in steel mill

construction and thin-slab casting operations has been shown to generally reduce the amount of

time needed to bring a new mill successfully on line and begin commercial shipments. Also, the

investment banking community assigns a lower risk-related value to the experience of a

company’s management team, lessening financial borrowing costs. SDI was founded by a group

of former Nucor managers who had built Nucor’s first thin-slab-based mill at Crawfordsville, IN;

the management team was able to start up a new company, the financing was completed only nine

months after they left Nucor, and the new mill came on line 14 months later. PaineWebber,

“Metals,” Sept. 16, 1997 and “Wall Street Diary: Stars, Wanabees and Has-Beens, Musings of a

Steel Banker,” PaineWebber, Mar. 4, 1997.

58

Recent Developments

Startup of Thin-slab/Flat-rolled Mills Continues

Since 1996, the new facilities (listed in table 1) have begun commercial shipments.

Although no final decision has been reached, two companies, Ipsco and Nucor, announced

they are considering building additional facilities that would use this new slab casting

technology.18 Commercial shipments of flat-rolled steel increased by approximately 62

percent to an estimated 7.6 million tons between 1996 and 1997, with a forecast of 10.3

million tons in 1998.19 These increases reflect higher operating levels as production expands

to reach designed capacity. Steel Dynamics Inc. (SDI) and Gallatin Steel are estimated to

have achieved 95 percent and 90 percent of their rated operating capacity, respectively, for

example.20 Sheet quality is considered to be good-to-high from these new mills, making

their products acceptable for exposed automotive applications.21 In addition to standard

carbon steel grades, these new mills have produced a range of stainless, electrical, highstrength-low-alloy, and low, medium, and high carbon steels. The hot-rolled products of

several of these mills have successfully penetrated markets that had required higher cost

cold-rolled sheet.

Construction and startup of the new thin-slab/flat rolled mills have proceeded with varying

degrees of success. The most successful venture, in terms of time elapsed between

beginning construction and starting commercial shipments, was SDI, which came online in

a record time of 14 months, and broke even on a cash flow basis in 18 months. Most of the

others have begun commercial-quality shipments in about 20 to 24 months.22 In contrast,
23 Scott Robertson, “Takeover Talks at Ipsco Mill,” American Metal Market, Nov. 17, 1997,

p. 3. 

24"Steel Dynamics and the Second Generation of Thin-Slab Casters,” New Steel, Sept. 1995,

p. 11, citing SDI president Keith Busse; Adam Ritt, “Acme Rolls 0.030-inch Hot Band,”

NewSteel, May 1997, pp. 72-79; and, Adam Ritt, “Casting Faster with Better Surface Quality,”

NewSteel, Apr. 1997, p. 67.

25Oscillation prevents the steel strand from freezing to the caster mold. Most conventional

oscillators are electromechanical while the newer ones are hydraulically operated.

26EMB minimizes the tendency of the mold powder to be drawn into the liquid steel because

it significantly reduces turbulence within the mold.

59

design and engineering changes during construction caused Ipsco to delay its takeover of the

Muscatine, IA, facility by nearly 18 months.23

Technology Advancement

Thin-slab casting technology continues to evolve. The first generation of thin-slab casters

is generally considered to be that installed at the Nucor facility at Crawfordsville, IN, in

1988. Compared with the rate of change of earlier technological advances, the pace of

improvement in thin-slab casting technology is increasing, and a second generation of thinslab casters incorporates changes in mold design and caster operation that result in improved

quality and higher productivity. Second-generation thin-slab casters incorporate such

improvements as--24

C Adjustment mechanisms for varying the width and thickness of a

continuous-cast strand (also called flexible thin-slab), allowing a slab to be

cast in thicknesses ranging from 40 mm to 80 mm. This raises downstream

productivity by matching caster output to specific rolling requirements. In

several of the mills, such changes can be accomplished “on the fly” (i.e.,

without loss of production due to downtime);

C Liquid core reduction (also called soft-shell-reduction). The continuouscast strand is compressed between two rollers that are set immediately

below the caster mold. This improves slab quality by reducing or

eliminating center line porosity, promotes a more refined steel grain

structure, and helps to improve slab surface quality;

C Improved oscillation control within the caster.25 Oscillation can be tailored

to specific steel grades, thereby increasing casting speed and total

throughput. Improved oscillation control has been optimized at several

mills by combining it with electromagnetic breaking (EMB).26 This

combination results in improved steel quality.

Mills also have made changes in downstream slab processing facilities, including improved

slab cooling and descaling equipment, additional rolling to improve sheet surface quality

and gauge control, and the use of artificial intelligence and neural networks for enhanced

processing control. To further control product quality, all of these mills are making some

use of scrap substitutes like direct-reduced iron, hot-briquetted iron, and iron carbide; four

of the mills have integrated backwards to the production of these furnace charge materials.
27"SMS teams up with Hylsa and Acme to expand CSP's capabilities," NewSteel, May 1997,

p. 61.

28"Newsfront,” NewSteel, Nov. 1997, p. 29.

29This yields inventory and transportation costs savings.

60

Outlook

Thin-slab casting continues to evolve at an increasing pace and the operators of such

equipment have continued to improve their productivity and enhance product quality.

Further research and development has been stimulated by technology partnerships that have

developed between mills and the equipment suppliers. One arrangement--that of SMS (the

supplier of most of the compact strip type thin-slab casting equipment) and Hylsa (a

Mexican steel producer) is focused on refining operating procedures for existing thin-slab

casting equipment, increasing production capacity, improving product quality, and reducing

capital cost in producing light-gauge product. Improvements developed at Hylsa are

expected to be channeled to other users of SMS equipment.27

Potential entrants to this segment of the U.S. steel industry have adopted a wait-and-see

attitude regarding actual results of the early adopters, while existing companies continue to

evaluate the impact of new capacity on their business. Several of the new mills have added

downstream coating and heat treatment lines; this added processing capability enhances

product quality and enables the mill to sell higher-valued products to customers in the

automobile and construction industries.28 Several other new mills are concentrating on the

efficient production of hot-rolled sheet, but their customers are building processing plants

close to the mill site.29 For example, Worthington Industries installed a hot-dipped

galvanizing line in April 1997 near NorthStar BHP’s mill in Delta, OH and is building a

pickling, cold-rolling, and slitting line adjacent to Trico’s mill in Decatur, AL, that is

expected to be operational in 1998.
1Sol-gel manufacturing was first developed during the 1950s as a means to manufacture

ceramics and glass with a wide range of advanced properties. 

63

Sol-Gel: Industry Seeks to Commercialize

Energy-Saving Technology for Existing and

Emerging Markets

Vincent DeSapio

(202)205-3435

vdesapio@usitc.gov

This article highlights a number of industry and government efforts

to develop and commercialize sol-gel processing. This process is

being used to create materials which possess mechanical and

thermal properties that exceed the properties imparted by

conventional ceramics and glass making processes. The use of

products derived through sol-gel also promises significant energy

savings in architectural, automotive, and commercial and

residential insulation applications. This article explores key

factors affecting commercialization of sol-gel, the role of certain

domestic and foreign industry and government institutions

involved in its research and development, and the short- and

longer-term commercial prospects for this technology.

This article was originally published in the Industry, Trade, and

Technology Review of December 1995. The concluding section

contains information on the latest efforts to commercialize sol-gel

related products. Most projects have been assisted at some point

in their development by U.S. Government funding, and firms are

now beginning to scale up commercial production of material after

initial pilot production of small quantities. 

Note: A glossary of technical terms (highlighted within the

article by bold italics) appears at the end of this article.

The application of sol-gel processing to industrial production enables specialized materials

(e.g. films and coatings, powders and grains, fibers, and porous gels and membranes) to be

produced from the gel state. This method enables a more precise control of composition,

purity, and microstructure, often at lower processing temperatures and reduced energy costs.

Sol-gel materials possess mechanical and thermal properties that exceed the properties of

similar materials produced under conventional processes.1 The use of products derived

through sol-gel processes also promises significant energy savings in certain applications.
2See articles on sol-gel appearing in Ceramics and Glasses; Engineered Materials Handbook,

Vol. IV, 1991. 

3

"Sol-Gel Process," Lisa C. Klein. Article appears in Ceramics and Glasses; Engineered

Materials Handbook, Vol. IV, 1991, p. 209. 

4

Ibid. pp. 210-11. 

64

For these reasons, there is currently strong international competition to commercially

develop this technology.

Although existing markets for sol-gel products tend to be lower-volume (estimated total

annual U.S. sales of less than $200 million), this technology is reported to have significant

commercial potential in large, international markets such as automotive and architectural

glass, and thermal and acoustical insulation, where the energy-savings advantages of sol-gel

products have been demonstrated. Recently, sol-gel technology has begun to be used in the

commercial production of textile fibers. Other promising commercial applications and

markets in which sol-gel may eventually be used include micro-optical components (in laser

optical devices), electronic sensors, and vapor-separating membranes and filters (for use in

environmental emission control and food processing applications). Although these markets

are presently small, sol-gel manufacturers feel they have large commercial potential

worldwide. 

This article examines the commercial potential for sol-gel processing in various current and

emerging markets, and discusses efforts of individual firms to develop this technology. Cost

and performance are examined as two of the critical conditions necessary for wider industry

acceptance of sol-gel products. Finally, the article describes the role U.S. and foreign

governments have played in helping to develop this technology.

The Sol-Gel Process2

Sol-gel processing involves a chemical synthesis of oxides that undergo a transition from

a solution or sol state to the gel state. In this synthesis, oxides are transformed from smallsized units in a liquid phase into rigid material of greater molecular weight through partial

loss of liquid. Both the initial chemistry of the mixture and the final stage of drying are

critical to successful manufacture of the five possible types of end-product forms -- thin film

and coatings, fiber, powder, porous gel, or monolith.

3

During the first stage of the sol-gel process, components are mixed to form a clear,

homogeneous solution that then gels to produce a highly porous oxide. The chemistry of

the mixture must be carefully controlled to induce liquid solvents to form a gel. In order to

remove the solvent material, the elastic gel is then either dried, under high-pressure and

high-temperature conditions, in an autoclave (a type of pressured furnace) to produce an

aerogel, or is dried naturally to produce a xerogel. If the drying temperature is raised too

high or rises too rapidly, the solvent may escape too quickly, causing cracks in the gel

structure. Generally, monoliths are the hardest materials to dry without cracking while thin

films and fibers dry much easier.4
5The sol-gel process principally competes in advanced materials processing, particularly in

the application of thin films and coatings, with vapor deposition technology. 

6Sol-gel has been used in the commercial production of reflective and anti-reflective glass

coatings used in instrument meter faces and in large area displays for nearly two decades and has

been widely used in the manufacture of advanced abrasive products since 1988.

7Film thickness can be increased by increasing withdrawal speeds from the vessel and by

increasing the oxide content of the solution; coating thicknesses of 50 to 500 nanometers are

typically produced. Sol-gel is not widely used for depositing thicker films and coatings which

require repeated dipping and firing operations; such operations are costly and also increase the

likelihood of contamination. Thicker films and coatings are generally deposited using vapor

deposition techniques.

65

Principal advantages and disadvantages of sol-gel processing as compared to competing

forming processes5 are noted in figure 1. The prospects for reducing the current

disadvantages and improving the competitive potential of sol-gel processing, principally

related to cost and performance factors, are examined later in this article in the section

dealing with the outlook for commercial production.

Product Applications and State of Process Adoption

The end-users of products made using the sol-gel process are likely to be most attracted to

the energy-savings potential of these products and by their superior performance under

extreme mechanical, chemical and thermal conditions. The glass and abrasives industries

are currently the largest users of sol-gel processing (table 1).

As discussed below, a number of private sector firms are currently engaged in sol-gel related

production, both on a prototype and a commercial basis. Manufacturers have identified

some large existing markets that may justify investments in large-scale production; such

economies of scale are necessary to make sol-gel products more cost-competitive with

traditional processes and products. In other cases, production is being targeted toward

future markets such as micro-optical components, that are presently small but are expected

to develop significant commercial potential. 

Thin Films and Coatings for Optical Applications

Films and coatings are the oldest and among the most commercially common applications

of the sol-gel process.6 Most sol-gel films and coatings are applied by "dipping", in which

a substrate is lowered into a vessel containing the solution.7

Sol-gel coating techniques are increasingly used in the manufacture of optical coatings

which alter the reflecting and light-transmission qualities, or heat absorption, of a substrate,

most often glass. Industry sources believe the annual market potential for electrochromic
66

Figure 1

Comparison of Sol-Gel Processing with Competing Technology 

Advantages Disadvantages

! The ability to produce high purity,

homogeneous ceramic products. Chemical

precursors, which can be distilled and

filtered, are used to produce final products

that are relatively free of impurities. 

Homogeneity is guaranteed because

particles are mixed in solution on a

nanometer scale, allowing precise

microstructure control in a relatively short

time.1 This enables particle size

distribution, porosity, and stoichiometry to

be carefully controlled, either in the sol or in

the sintering stage, to create high-purity

structures which are ideally suited for such

advanced applications as high-purity

electronic coatings and sensors.

! Sol-gel’s low-temperature process

canachieve energy cost savings when

compared with conventional processes.3

Because colloidal particles have very high

surface energies, sol-gel processing permits

sintering (bonding) to occur at temperatures

well below product melting temperatures. 

! Higher raw material coasts that result

from the need to use expensive, highpurity precursors.

! Removal of solvents and the overall

shrinkage of the solution must be

carefully controlled to avoid cracking

and the dissipation of large amounts of

volatile materials, because colloidal

gels have very small pore structures

and relatively low densities. Such

concerns often limit the size of

components that can be produced by

this process.2

1 "Sol-Gel Process,” Lisa C. Klein. Article appears in Ceramics and Glasses; Engineered

Materials Handbook, Vol. IV, 1991, p. 213.

2 The New Materials Society: Challenges and Opportunities, Volume 2, U.S. Bureau of

Mines, 1990.

3 C. Jeffrey Brinker and George W. Scherer, Sol-Gel Science: The Physics and Chemistry of

Sol-Gel Processing, 1990, p. 840.
67

Table 1

Sol-gel processing: Product form, end-use industry, specific end-use, properties, present estimated market value, estimated commercial market value over 10 years

Present estimated Estimated commercial market

Product form End-use industry Specific end-use Properties market value value over 10 years1

Coatings Optical glass Large area displays, Glare reduction $50-100 million $200 million

 sensors, laser optics, Broadband light

 solar cells transmission

Thin films Architectural/ Electrochromatic Thermal efficiency Minimal $1 billion

 construction window glass Control of light

 transmission

Fibers Aerospace/Defense Thermal insulation Heat and abrasion Minimal (

2

)

 for aircraft resistance

Textile Refractory braiding Strength, Minimal (

2

)

 and fabrics heat-resistance

Monolithics Optical glass Lenses, prismatic High purity Minimal (

2

)

 arrays, diffractive Glare reduction

 gratings

Grains and powders Cutting tools Grinding wheels, Impact resistance $100 million $200 million

 abrasive belts, Sharpness

 sandpaper

Porous gels and Construction/ Thermal and acoustical Small pore size Minimal $2 billion

 membranes refrigeration insulation Thermal efficiency

Chemical Membranes for filtration Abrasion and heat Minimal $10-15 million

 and separation systems resistance, small

 pore size

Environmental Catalytic application Small pore size Minimal $10-15 million

Food and beverage Microfiltration systems Small pore size Minimal $10-15 million

 and beverages

 

 1Estimates of potential market sizes are based on discussions with a limited number of firms currently involved in prototype or commercial production as cited elsewhere

in this article and are somewhat speculative in nature.

 2Not available.
8

John P. Cronin and A. Agrawal, “Large Area Transmissive Electrochromic Devices,”

(Draft), 1995, p. 1.

9C. Jeffrey Brinker and George W. Scherer, Sol-Gel Science: The Physics and Chemistry of

Sol-Gel Processing, 1990, p. 847.

10Product literature, Denton Vacuum Inc., Moorestown, NJ.

11John Van Dine, SAGE Electrochromics Corp., telephone interview by USITC staff,

Washington, DC, Aug. 1995.

68

glass alone could total more than $1 billion by 2005.8 Critical factors that are involved with

optical coating applications include precise control of coating thickness and degree of

refraction and, in multilayer films, changes in the amount of refraction between films.9 The

ability to adjust these characteristics enables the manufacture of a number of products with

significant energy-saving potential. 

Coated electrochromic glass for "smart windows", in which light and heat to the interior of

a building can be automatically controlled, is expected to become the most widely-used

application for optical coatings. The exterior of coated electrochromic glass appears

uniformly reflective; however, light transmission to the interior varies inversely with sun

exposure, thereby minimizing heating and cooling costs. In addition to reflective coatings,

oxide coatings can also be used to produce anti-reflective surfaces. Such glass is presently

used in large-area displays (shop and museum windows), computer terminals, meter faces,

automotive glass and rearview mirrors, and in laser-damage-resistant, anti-reflective

coatings for laser optical devices. 

One leading commercial U.S. producer of sol-gel optical coatings is Donnelly Corp.

(Holland, MI) which uses sol-gel to produce optical barrier coatings for electrochromic

displays, automotive rear view mirrors (PolychromicTM), and sunroofs. Another company,

Denton Vacuum Inc. (Moorestown, NJ), has used sol-gel technology for nearly 20 years to

apply reflective and anti-reflective silicon dioxide and titanium dioxide optical coatings on

laminated or tempered glass for use in CRT's and flat panel displays, meter faces, instrument

windows, shop and museum windows, implosion panels, and architectural glass. According

to Denton, the anti-reflective glass produced using sol-gel provides clearer images by

reflecting less than 1 percent of all visible light transmitted, thus reducing glare by 99

percent.10 Conventional glass may reflect as much as 8 percent of visible light transmitted,

leading to noticeable glare on the surface of the glass.

Two of the promising markets for sol-gel coatings appear to be those for electrochromic

glass used in architectural and automotive glazing applications. Both Donnelly Corp. and

Sage Electrochromics, Inc. (Piscataway, NJ) are actively involved in projects, financed

partly by the U.S. Departments of Energy and Commerce, that may eventually lead to the

commercial production of optical glass coatings for these markets. Although cost figures

are difficult to establish, it appears that electrochromic glass is produced, using either

existing sol-gel or vapor deposition technology, at a significant cost premium ($30-

35/square foot) compared with conventional low-emissivity glass ($10-12/square foot) with

which they would compete.11 However, manufacturers contend that such cost comparisons

do not account for the superior thermal efficiency of electrochromic windows. According

to these manufacturers, electrochromic windows will be sold as "thermal insulating

packages" that will not only replace conventional low-emissivity windows during the next
12According to research conducted by Donnelly Corp., electrochromic glass is capable of

reducing cooling and electric lighting energy requirements for a building containing lowemissivity glass by 50-80 percent. (John P. Cronin and A. Agrawal, “Large Area Transmissive

Electrochromic Devices,” (Draft), 1995, p. 6). 

13To produce an abrasive powder or grain, a gel is formed from an aluminum oxide

monohydrate solution, then extruded or spread out to a convenient shape and carefully dried

before being sintered and finally crushed.

14For example, “fused” processing, in which powders are heated in a furnace and cooled

under controlled conditions to form abrasive grains.

15Edward J. Kubel Jr., "Development and Application of Seeded Sol-Gel Abrasives," ASM

News, October 1989, p. 4.

16In processes developed by Norton Inc. (known as "Seeded Sol-Gel", or "SG") and 3M Inc.

(known as "Cubitron"), alpha alumina particles, or, "seeds" are introduced to an aluminum oxide

solution to yield an abrasive grain with near-theoretical density and hardness.

17Edward J. Kubel Jr., "Development and Application of Seeded Sol-Gel Abrasives," ASM

News, October 1989, p. 4.

69

decade, but will also add considerably to the thermal efficiency of the entire structure.12 In

addition, manufacturers are confident that they are on the path to reducing the cost of sol-gel

electrochromic glass to $15-25 per square foot, a level at which such glass competes directly

with low-emissivity glass. 

Powders and Grains for Abrasive Applications

Future demand for sol-gel powders and grains for use as advanced abrasives appears

promising due to the ability of the sol-gel process to control grain size and shape, to

guarantee uniform and homogeneous microstructures, and to take advantage of lower

processing temperatures.13 The principal advantage that sol-gel has over conventional

abrasive production techniques14 is the unique ability of sol-gel to produce small,

submicron-sized particles; billions of submicron particles can be contained in one 60-grit

abrasive grain with thousands of micron-sized cutting points in each grain. Although the

abrasive grains shed micron-sized particles while grinding, new cutting edges are

continually exposed. This enables less frequent sharpening or “dressing” of a cutting tool,

and extended tool life. The advance in the production of longer-lasting abrasives which can

operate at higher speeds provides to fabricators the capability of working on hard-to-grind

materials, such as aerospace alloys and forged steels.15

Sol-gel alumina abrasive grains have been produced commercially by 3M Inc. and Norton

Inc. since 1988.16 Both firms use aluminum abrasive grains to produce such abrasive

products as grinding wheels, coated abrasive belts, and sandpaper. Total U.S. sales of solgel abrasives are nearly $100 million per year. According to Norton Inc., the development

of sol-gel abrasives represents a highly significant development in grinding wheel and

coated abrasive applications, allowing the company to supply specialized customers such

as aerospace manufacturers with abrasives tools that are lower maintenance and longerlasting, leading to higher productivity and reduced grinding costs.17

 
18Fibers are typically either drawn from solution or extruded from monolithic shapes that have

been dried and sintered.

19For example, fibers for reinforcement of concrete and glass that contain more than 20

percent zirconia oxide are difficult to prepare conventionally because of high melting

temperatures required. (C. Jeffrey Brinker and George W. Scherer, Sol-Gel Science: The Physics

and Chemistry of Sol-Gel Processing, 1990, p. 862) 

20John Mack, “Advanced Ceramics Processing; Cracking the Problem,” Materials Edge,

July/August 1990, p. 29.

21Porous gels are distinguished from membranes by pore size. The most common form of

porous gels and membranes are aerogels, which are lightweight, nearly transparent, porous

materials in which the particles and the pores between them have dimensions of less than 100

billionths of a meter. 

22C. Jeffrey Brinker and George W. Scherer, Sol-Gel Science: The Physics and Chemistry of

Sol-Gel Processing, 1990, p. 868.

70

Fibers for Heat-resistant and Reinforcement Applications

Sol-gel processes can be used to prepare continuous, refractory, polycrystalline fibers18 that

display high strength, thermal resistance, stiffness, and durability. The advantage of the solgel process in forming fibers is that highly refractory and chemically durable fibers can be

economically formed at room temperatures; these fibers are difficult to prepare using

conventional high temperature processes.19

Sol-gel fibers are finding commercial use in the aerospace, industrial textile, and electrical

industries because of their purity and their ability to resist heat and corrosive gases.

Reinforcement applications for these fibers include use in fabric, tape, and cordage.

Refractory textile applications include use in furnace belts, flame curtains, and hightemperature gaskets and cables. Continuous ceramic fibers can also be combined with other

fibers, whiskers, or powders and formed into porous shapes for use as insulation in the

aerospace/defense industries (including use as insulating tiles in the U.S. Space Shuttle

program).20 

3M Inc., the only known U.S. manufacturer of sol-gel fibers, currently produces small,

commercial quantities of continuous filament ceramic fibers (NextelTM) for use in fabrics,

tapes, sleevings and cordage. According to 3M, the high-temperature performance

(including low shrinkage, abrasion resistance, and thermo-electric insulation properties) of

Nextel 312 and 440 ceramic fibers is superior to inorganic fibers such as fiberglass, or fused

or leached silica. Because of their ability to withstand high temperatures, Nextel fibers are

also being considered for use in matrix-composite materials and in heat exchangers and

radiant gas burner tubes in power-generating plants.

Porous Gels and Membranes for Insulation and Filtration Applications21

Porous gels and membranes are characterized by high surface area and small pore volume,

making them ideal for applications in thermal and acoustical insulation, in filtration and

separation systems, and in catalytic applications.22 These materials are often difficult to

produce using traditional ceramic processing methods. Sol-gel pore films and membranes

offer a number of advantages over conventional materials:

! they can be used at high temperatures
23Doug Smith, NanoPore Inc., telephone interview by USITC staff, Washington, DC, Aug.

1995. 

24Ibid.

25"Aerogels Set to Take Off," Chemical Engineering Progress, June 1995, p. 14.

26A board foot is defined as a volume equal to 1 square foot multiplied by a thickness of one

inch, or 144 cubic inches.

27Doug Smith, NanoPore Corp., telephone interview by USITC staff, Washington, DC, Aug.

1995.

28Ibid.

71

! they do not swell or shrink in contact with liquids

! they are highly thermal- and abrasion-resistant

! pore sizes can be carefully controlled to avoid pin holes and cracks. 

The principal immediate market for porous gels and membranes is likely to be thermal

insulation, where much research is presently concentrated. Eventually, the use of these

materials may also extend to the microfiltration of water, wine, and beverages; the

ultrafiltration of milk; the separation of gases in various industrial processes; and

environmental applications such as catalysts to reduce nitrogen oxide emissions in

automobiles. 

The NanoPore Co. (Albuquerque, NM), relying on research pioneered by Sandia National

Laboratories and the University of New Mexico's Center for Micro-Engineered Ceramics

in Albuquerque, has developed a sol-gel process for producing aerogel using normal

pressures and temperatures rather than the high pressures and high temperatures required

under older sol-gel technology.23 NanoPore believes that its process will lead to quicker and

less-costly commercialization of aerogel for use in refrigerators, water heaters, vacuum

bottles, walls, and window panes.

Aerogel thermal insulation is reported to possess ten times the thermal insulating properties

of ordinary glass fiber insulation. NanoPore's pilot aerogel production plant has a rated

annual manufacturing capacity of 100,000 pounds and the firm anticipates that near-term

markets for aerogel insulation could total $1-2 billion in annual sales within the next

decade.24 The company expects to begin commercial production of aerogel within the next

two years provided certain performance difficulties are overcome which have limited their

use in some insulation applications. One of the largest performance problems is poor light

transmission (opacity), which has prevented the use of aerogel as a thermal barrier in

window glazing, another potentially large market for aerogel.25 

Aerogel thermal insulation is presently manufactured at a significant cost premium over

conventional insulation. For example, glass fiber insulation and urethane insulation,

produced commercially at a cost of 2-3 cents per board foot26 and 6-7 cents per board foot,

respectively, cost far less than aerogel insulation, which is produced at a cost of nearly 10

cents per board foot.27 Although the cost of aerogel insulation presently exceeds

conventional insulation by a factor of between two and four, it is reported that the higher

thermal resistance achieved with aerogel insulation translates to significant weight and

volume savings that makes aerogel insulation more cost competitive with conventional

insulation.28 

Joint Government/Industry Support of Sol-Gel Projects
29John Van Dine, SAGE Electrochromics Corp., telephone interview by USITC staff,

Washington, DC, Aug. 1995.

30Dr. Niall Lynam, Donnelly Corp., telephone interview by USITC staff, Washington, DC,

Aug. 1995.

31John Gudas, U.S. Department of Commerce, National Institute of Standards and

Technology (NIST), Aug. 1995.

72

Both the U.S. and foreign governments have joined with private firms to assist in the

development of products made using the sol-gel process. Support by the U.S. Government

of promising technological projects, which often have difficulty attracting private capital,

may have important commercial benefits for industry, contributing toward achieving higher

levels of energy efficiency for the entire economy. The financial and technical assistance

provided by such partnerships allows smaller firms, which tend to be less well capitalized

than larger firms, to raise the large sums required to develop these expensive technologies.

Access to government resources offers smaller firms a means of leveraging costs, thus

neutralizing many of the financial advantages of some larger firms. In some cases,

participation in a joint project has allowed participants to share research information and to

pool scientific talent with Government agencies and with other organizations doing similar

research, such as national laboratories and universities. Sharing research has resulted in

certain technical breakthroughs for some firms that potentially shortens the lead time

required to bring products to market.29 Finally, industry representatives believe that

continued backing by national governments of sol-gel projects lends credibility to the

commercial products developed and serves to remove much of the uncertainty associated

with adoption of new designs that incorporate these products. This is particularly true of

sol-gel electrochromic coatings for architectural windows where the conservative nature of

architects has reportedly proved an obstacle to the broader application of sol-gel products

in construction markets.30 

The U.S. Federal Government contributes to sol-gel development by funding various

industrial efforts to commercially produce components using sol-gel. These efforts are

made through a variety of federal agencies and programs, including the Advanced

Technology Program (ATP) of the U.S. Department of Commerce’s National Institute of

Standards and Technology (NIST), the U.S. Department of Energy, and the Advanced

Research Projects Agency (ARPA) of the U.S. Department of Defense (table 2). Barring

an immediate termination of funding, the present period of anticipated reductions in federal

expenditures for research and development projects is not expected to affect the funding of

projects already underway. However, because these anticipated reductions will affect the

funding of projects in the future, some agency officials feel they may dampen the

enthusiasm of many in industry to present project proposals.31

Although detailed specific information on sol-gel related research and development funding

by foreign private firms and governments is often not available, it appears that there has

been a major commitment by leading industrial nations to develop advanced materials

technology as a means of stimulating economic growth and competitiveness. Financing of

sol-gel research and development in Europe is being done through private and public
32In 1994, the total ministry budget was DM 450 million.

73

Table 2

Some current sol-gel related projects financed partially with Federal funds: Participants, U.S. government

agency, product, and end-use

Participants U.S. government agency Product End-use

Geltech Inc. Department of Commerce Silica glass Optical components

 (NIST)

SAGE/3M/Rutgers Department of Commerce Electrochromic Architectural

 (NIST) glass glass

3M Department of Defense Fiber Aerospace and

 (ARPA) other structural

 applications

Aerojet/ Department of Energy Aerogel Thermal and

 Livermore acoustical

 National Labs/ insulation

 Lawrence products

 Berkeley

 National Labs

Donnelly Corp. Department of Energy Electrochromic Architectural and 

 Glass automotive glass

institutions (both individual EU governments and through EU agencies). In Japan, there

also appears to be considerable government involvement in sol-gel research and

development. Support by the Japanese Government for sol-gel technology is channeled

through its Ministry of International Trade and Industry (MITI) and is included with other

technology assistance in a number of specific materials research projects. Such projects

include: High-Performance Ceramics; High-Performance Materials for Severe

Environments; Advanced Material and Machining System; and Advanced Chemical

Processing Technology. Germany provides support for sol-gel projects principally through

the Federal Research Ministry (BMFT),32 which supports activities dedicated to the

following sectors: Physical and Chemical Technologies; Ceramics and Glass; and

Composite Systems.

Domestic Sol-Gel Activity

Following is a discussion of some projects financed, in part, by the U.S. Government. Many

of these projects are still in the prototype stage but all are expected to result in commercial

production within 3-5 years.
33Jean-Luc Nogues, R. Layne Howell, “Fabrication of Pure Silica Micro-Optics by Sol-Gel

Processing,” July 1992, pp. 1-6.

34Jean-Luc Nogues, Geltech Inc., telephone interview by USITC staff, Washington, DC, Aug.

1995.

35Ibid. 

36William Moreshead, Geltech Inc., telephone interview by USITC staff, Washington, DC,

Aug. 1995. 

37John Van Dine, SAGE Electrochromic Corp., telephone interview by USITC staff,

Washington, DC, Aug. 1995.

74

U.S. Department of Commerce (Advanced Technology Program--ATP)

Geltech Inc. (Alachua, FL) received a $1.3 million grant under the ATP in 1994 to further

develop its patented sol-gel process for the molding of high-purity silica glass for monolithic

micro-optical components to be used as lenses, diffractive and refractive optical devices, and

diffractive gratings. These high-quality silica glass products are reported to have excellent

broadband (ultraviolet to near-infrared) light transmitting properties33 enabling their use in

electronic sensors and in laser systems where they are used as diffractive gratings and microlens arrays to split incoming laser beam energy into many equal intensity beams.

Traditional molding and finishing techniques often cannot be used to process silica glass for

such high-performance optical applications because the high temperatures required in using

these techniques are cost-prohibitive. Moreover, conventional grinding and polishing

processes are limited in their ability to manufacture small and complex micro-optical

components.34 Geltech hopes to use its sol-gel process to cast net-shape silica glass microoptical components at room temperature, resulting in products that are extremely pure and

homogeneous, and are also lower in cost than products produced using conventional

techniques. Thus far, Geltech has been manufacturing dense silica glass for optical products

using sol-gel technology on a prototype basis, and expects to shortly begin commercial

production.35 Geltech has also begun commercial production of porous glass for electronic

sensor applications as a direct result of its sol-gel work under the ATP grant.36 

SAGE Electrochromics, Inc., in cooperation with 3M Inc. and the Rutgers University Center

for Ceramic Research, was awarded an ATP grant of nearly $3.5 million in 1992 to facilitate

the manufacture of electrochromic glass for use primarily in architectural windows

(SAGEGLASSTM). In this process, sol-gel technology is used to deposit several layers of

thin films on a transparent glass base. The momentary flow of electric current to the glass

base then alters the transparency of the glass from clear to heavily shaded. The largest

potential application is in "smart windows," electronically controlled windows that

conserve energy by automatically lightening or darkening, depending on the amount of

sunlight, the time of day, the season, or the preference of the user. The amount of incoming

sunlight could be regulated through simple operation of a switch or a remote control to allow

buildings to be shaded on warm days and opened to sunlight on cloudy or winter days.

Success in this application could eventually allow the process to be used to produce similar

electrochromic coatings in sensors, superconductors, and optoelectronic circuits. SAGE is

presently producing demonstration prototypes of its electrochromic glazing product and

anticipates commercial production by 1997.37

U.S. Department of Energy
38Dr. Niall Lynam, Donnelly Corp., telephone interview by USITC staff, Washington, DC,

July 1995. 

39Eugenie Uhlmann, Donnelly Corp., telephone interview by USITC staff, Washington, DC,

July 1995. 

40Dr. Niall Lynam, Donnelly Corp., telephone interview by USITC staff, Washington, DC,

July 1995. 

41John P. Cronin and A. Agrawal, “Large Area Transmissive Electrochromic Devices,”

(Draft), 1995, p. 1.

42Anoop Agrawal, Donnelly Corp., telephone interview by USITC staff, Washington, DC,

Sept. 1995.

43"Aerogels Set to Take Off", Chemical Engineering Progress, June 1995, p. 16.

75

Donnelly Corp. is currently in the first year of a three-year, $800,000 joint project with the

U.S. Department of Energy to produce electrochromic glass for the architectural and

automotive industries using the sol-gel process.38 Donnelly anticipates that commercial

production of its electrochromic glass will begin in the third year of this project.39 The firm

anticipates some resistance to its product in the marketplace due to its higher initial cost and

the reluctance of some architects to depart from the practice of specifying familiar building

materials with well-established properties. Similarly, automotive designers are also

reluctant to introduce new design concepts to replace materials with proven acceptance in

the marketplace. However, Donnelly Corp. is confident that once the advantages of

electrochromic glass are demonstrated and the cost is reduced to more competitive levels,

it will be able to effectively compete in these huge markets.40 According to the company,

the expected sales of electrochromic glass could exceed $1 billion within the next 5 to 10

years.41

Donnelly is confident that it will eventually lower the cost of its electrochromic glass from

the present $30-35 per square foot to $15-25 per square foot as it continues to make

technical innovations in product technology. At this lower cost level, electrochromic glass

would begin to compete effectively with conventional low-emissivity glass produced at $10-

12 per square foot. Donnelly is now focusing its research efforts on finding cost-effective

means to produce electrochromic coatings.42

Aerojet Corp. (Sacramento, CA) has begun production and testing of organic aerogels as

part of a 15-month, $2.6 million Cooperative Research and Development Agreement with

Lawrence Livermore and Lawrence Berkeley National Laboratories. Commercial

manufacture of these aerogels is expected to begin following the expiration of the

agreement in 1996. Potential aerogel identified by Aerojet include refrigeration systems,

automotive door panels, ceilings, catalytic converters, and a number of aerospace

applications.43

U.S. Department of Defense (Advanced Research Projects Agency--ARPA) 

3M Inc. is currently working with ARPA to develop Nextel 610, a new generation 99.5

percent aluminum oxide fiber to improve the strength and thickness of reinforced metalmatrix and ceramic-matrix composites. Thus far, 3M has supplied a limited quantity of

Nextel 610 fibers from its pilot plant to ceramic composite manufacturers for experimental

use in aircraft engines. 3M also anticipates selling Nextel 610 fibers to reinforce metals

such as aluminum or titanium for use in aerospace applications such as missile fins, and for

strong, lightweight parts for aircraft, bicycle frames, or automobiles. The company
44Robert Carlton, 3M Corporation, telephone interview by USITC staff, Washington, DC,

Aug. 1995. 

45Dr. Helmut Schmidt, New Materials Technology Corp., telephone interview by USITC

staff, Washington, DC, Nov. 1995.

46Eugenie Uhlmann, Donnelly Corp., telephone interview by USITC staff, Washington, DC,

Nov. 1995.

47Dr. Helmut Schmidt, New Materials Technology Corp., telephone interview by USITC

staff, Washington, DC, Nov. 1995.

48"Aerogels Set to Take Off," Chemical Engineering Progress, June 1995, pp. 17-18.

49Ibid.

76

anticipates a ten-year time horizon before large-scale production and commercialization of

Nextel 610 begins.44

Foreign Sol-Gel Activity

The following is a brief discussion of some of the known sol-gel activities by foreign

competitors. 

Schotte Glaswerke (Germany) is the world's leading volume producer of optical coatings

using sol-gel technology, producing reflective and anti-reflective products used in computer

monitors, meter faces, and large-area display glass. Asahi Glass and Hitachi of Japan are

also seeking to establish commercial production of sol-gel optical coatings for use in similar

applications. There is no known foreign commercial production of electrochromic glass;

however, Pilkington Ltd. (United Kingdom), New Materials Technology Corp. (Germany),

Saint-Gobain (France), and Toyota and Nikon in Japan are seeking to commercially develop

this technology. Pilkington and New Materials Technology will reportedly begin

commercial production of electrochromic glass by late 1996 or early 1997.45 In addition to

its production and research facilities in the United States, Donnelly Corp. also has facilities

in Ireland, France, and Germany from which it intends to eventually supply the European

market with sol-gel coated materials.46 Although there is yet no known foreign commercial

production of aerogel, a number of foreign firms are producing aerogel on a prototype basis

with commercial production expected soon. Both BASF and Hoechst of Germany are

producing aerogel in pilot plants with commercial production reported to be imminent.

BASF reportedly has annual aerogel production capacity of 100,000 square meters in its

plant and will soon begin selling aerogel for use as a translucent (semi-transparent) thermal

insulating barrier in window glazing.47 Hoechst is manufacturing aerogel under technology

licensed by NanoPore Inc. (United States). The manufacture of aerogel for use in the

refrigerator and hot-water heater markets is being encouraged by tighter environmental

legislation in Germany.48 Despite its higher initial cost, aerogel use is being encouraged in

Germany because it is easier for refrigerator manufacturers to handle, process, recycle, and

reuse aerogel than conventional insulation.49 Airglass (Sweden) is preparing for commercial

production of aerogel in a plant capable of producing nearly 100,000 pounds of aerogels

annually, comparable to the rated capacity of NanoPore’s pilot plant.

Outlook for Commercial Production
50Doug Smith, NanoPore Inc., telephone interview by USITC staff, Washington, DC, Aug.

1995.

51John P. Cronin and A. Agrawal, "Large Area Transmissive Electrochromic Devices,"

(Draft), 1995, p. 1. This market estimate is based on gaining just a small market penetration of the

more than 35 million new cars and trucks produced annually worldwide, and a modest penetration

of the market for low-emissivity windows, which now command 40 percent of the residential

window market and nearly 30 percent of the commercial window market.

52Dr. Niall Lynam, Donnelly Corp., telephone interview by USITC staff, Washington, DC,

July 1995.

53Doug Smith, NanoPore Inc., telephone interview by USITC staff, Washington, DC, Aug.

1995. 

77

The principal obstacles to wider use of the sol-gel process in manufacturing are the related

problems of cost and performance. Because sol-gel is still a relatively expensive production

process, its use presently can only be justified, on a cost basis, for high-performance

applications which tend to be low-volume. Manufacturers of sol-gel components believe

the cost of such components eventually will substantially decline. This is expected to occur

through a combination of increased demand sufficient to allow average production costs to

decline, and further technical breakthroughs aimed at reducing manufacturing costs of solgel products to costs of competing products. Another obstacle is the requirement to develop

manufacturing processes that guarantee consistent high-volume production of quality

components. Because of existing low production levels for many sol-gel products, process

technology has not advanced sufficiently to produce components of a consistent level of

quality. Further advances and refinements in processing technology are needed to guarantee

consistent levels of quality before large production runs can begin.50 

Existing large-volume markets which sol-gel manufacturers expect to enter include markets

for architectural and automotive glass, and for thermal and acoustical insulation. Within the

next 5 to 10 years, the expected sales of electrochromic glass used in architectural and

automotive applications could exceed $1 billion.51 Manufacturers are seeking to

demonstrate the ability to produce consistent, high-quality material in the dimensions

required for architectural and automotive glass at a competitive cost.52 Entry into these

markets would allow manufacturers to produce in sufficient quantities to demonstrate

consistent high quality and also to realize economies of scale, thereby reducing costs further.

Similarly, the market potential for aerogel use in thermal and acoustical insulation is also

potentially large; estimates of potential U.S. annual sales of aerogel products over the next

decade approach $2 billion.53 Commercial prospects for aerogel depend on the ability of

manufacturers to resolve technical problems such as opacity and to reduce costs to levels

that would make aerogel insulation competitive with conventional insulation. Industry

officials believe that further reductions in the cost of producing aerogel, combined with

aerogel's superior thermal qualities, will eventually unlock this large potential market.

Many of the advanced technology markets for sol-gel products do not presently exist in

volumes large enough to justify increased volume production of sol-gel components.

However, this situation is likely to change as such devices as optical lasers, optical

waveguides, solar cells, and optical fibers find increasing applications in the 21st century.
54William Moreshead, Senior Scientist, Geltech Inc., telephone interview by USITC staff,

Washington, DC, Nov. 1997 and product information supplied by Geltech.

55"Low-Cost Method for Aerogels,” R&D Magazine, Sept. 1996, p. 51.

56Doug Smith, President, NanoPore Inc., telephone interview by USITC staff, Washington,

DC, Nov. 1997.

78

The U.S. Government has played an important role in facilitating the financial investment

and innovative research efforts required to bring this technology to market and to match

research and development efforts of foreign governments. A variety of jointly funded U.S.

programs have committed significant resources to developing the commercial viability of

this technology. Continuation of joint efforts is viewed by some industry officials and endusers as an important component in ensuring the domestic commercial success of this

promising technology, and global competitiveness in this new technology field.

Recent Developments

Although commercial application of sol-gel technology continues to be concentrated in solgel abrasives, its use in the manufacture of films, coatings, powders and grains, fibers, and

porous gels and membranes for other end-use industries has grown rapidly in recent years.

Total U.S. sales of sol-gel produced products rose from less than $200 million in 1995 to

nearly $300 million in 1997, of which approximately $200 million is sales of sol-gel

abrasives. For nonabrasive end-uses, the use of sol-gel to produce silica glass for optical

products was largely being done on a prototype basis in 1995. Today, the sol-gel process is

being used to commercially produce silica lenses for the electro-optics industry. Although

the grant to Geltech Inc. (Orlando, FL) for prototype production of high-purity silica glass

for monolithic micro-optical components under the ATP (Advanced Technology Program)

expired in 1997, the sol-gel technology developed through the ATP allowed the firm to

begin commercial production of porous glass for use in electronic sensors designed for home

monitoring systems. The company currently produces more than 100 million units of such

glass annually. Geltech’s development work in sol-gel also was instrumental in the firm’s

selection for a U.S. Department of the Army contract for $500,000 to build prototype

windows molded in silica. The windows will be mechanically hard, transparent to visible

and infrared light, resistant to laser radiation, and possess the necessary optical quality for

military and commercial applications. Eventual applications include night-vision optics,

imaging systems for tank periscopes, surveillance camera systems, and power-limiting

devices for commercial systems.54 

The manufacture of porous gels and membranes for thermal insulation is still largely in the

product development stage but is nearing commercial availability. Some joint commercial

production of aerogel by Allied Signal Corp. and the NanoPore Corp. (Albuquerque, NM)

is used by the semiconductor industry. NanoPore, in combination with Sandia National

Laboratories, the University of New Mexico, and the U.S. Department of Energy has also

developed a sol-gel process for producing aerogels which has reduced product cost from as

high as $45/kg to as low as $7/kg, a price at which it begins to compete with conventional

glass-fiber insulation.55 NanoPore is currently producing aerogel at its pilot plant in Illinois

and soon expects to begin commercial production of more than a million pounds of aerogel

annually, dedicated largely for the building construction market.56 According to NanoPore

officials, aerogel thermal insulation possesses 10 times the thermal insulating properties of
57Ibid.

58Officials of Donnelly Corp., telephone interview by USITC staff, Washington, DC, Nov.

1997.

79

ordinary glass fiber insulation; the total market for aerogel insulation could reach $1 to 2

billion by 2005.57

The market for sol-gel coatings for use in electrochromic glass used in the manufacture of

“smart windows”, continues to advance. Donnelly Corp. (Holland, MI), a commercial

producer of sol-gel optical barrier coatings for electrochromic displays, has been involved

in a project, financed partly by the U.S. Department of Energy, to produce optical glass

coatings using sol-gel processing for the architectural market. As a result of technology

developed during this project, Donnelly has decided to build a pilot plant to produce 5,000

to 10,000 square feet of electrochromic glass in 1998. The cost of the glass produced is

likely to be in the range of $30 to $35/square foot, compared with conventional lowemissivity glass, which is produced at $10 to $12/square foot. Donnelly remains confident

that as production is scaled up, average cost will fall to $15 to $25 per square foot, a level

at which such glass competes directly with conventional low-emissivity glass. Annual

market potential for electrochromic coatings has been estimated at $1 to $2 billion by

2005.58
80

Glossary of Terms

Aerogel The most common form of porous gels and membranes, which

are lightweight, nearly transparent, porous materials in which the

particles and the pores between them have dimensions of less

than 100 billionths of a meter.

Arrays An arrangement of micro-lenses of equal diameter and curvature

which are assembled into compact units. Micro-lens arrays are

typically used in semiconductor laser devices.

Colloid A state in which small particles of solid, liquid, or gas are

distributed in a gas, liquid or solid. The dispersed particles are

so small that they do not form an obviously separate phase, but

they are not so small that they can be said to be in true solution.

Diffractive grating An optical device, used in laser systems, to produce discrete

beams of energy by diffracting various incoming wavelengths of

electromagnetic energy. 

Electrochromic glass Glass or layers of glass upon which several layers of thin,

transparent, and conductive coatings of materials such as

tungsten oxide are deposited. By varying the amount of

electrical energy supplied to the glass, the transparency of the

coatings can be altered to vary the amount of light or heat

penetrating the glass. 

Gel A colloid in which a liquid contains a solid arranged in a fine

network extending throughout the system to produce a viscous,

jelly-like product. 

Low-Emissivity A surface coating for glass that permits the passage of most

shortwave electromagnetic radiation (especially light), but

reflects most longer-wave radiation (heat).

Matrix-composites Advanced materials in which discrete or continuous reinforcing

fibers are embedded in a matrix, often of metal or ceramic.

Composites have very high strength and stiffness in the direction

of the fibers. 

Monoliths Bulk gels that are cast to complex shapes. Monolithic gels are

often formed at room temperature and consolidated into final

shapes at lower temperatures. 

Nanometer A unit measuring thickness in billionths of a meter. 

Net-shape A processing method which is used to produce a semimanufactured part which is close to the final manufactured part.
81

Eliminates the need for extensive and more costly finishing

operations.

Oxide A binary compound of oxygen with another element. Most

oxides are prepared by reacting an element with oxygen at an

appropriate temperature. 

Porosity The state of a material which allows the passage of gas or liquid

through pores in the material. Porosity varies with the particle

size of the material.

Precursor An intermediate compound used in the formation of specific

final materials.

Refraction The change of direction in the propagation of a light wave as it

passes through a medium such as glass.

Sintering The bonding of adjacent surfaces in a mass of particles by

molecular or atomic attraction. Sintered materials are heated at

temperatures below the melting temperature of any component

part in the material.

Sol Sometimes known as a colloidal solution. A liquid colloidal

dispersion.

Solution A uniformly dispersed mixture, at the molecular or ionic level,

of one or more substances (the solute) in one or more substances

(the solvent). These two parts of a solution are called phases.

Stoichiometry The branch of chemistry that deals with the quantities of

substances that enter into and are produced by chemical

reactions.

Substrate Any solid surface on which a coating or layer of a material is

deposited.

Vapor Deposition A process used to apply a thin coating with a desired set of

properties to an inexpensive substrate. The most popular vapor

deposition methods used by industry include Chemical Vapor

(CVD) and Physical Vapor Deposition (PVD).
83

Direct Ironmaking: A Case Study in

Government and Industry Cooperation to

Commercialize Manufacturing Processes for

Materials

Cheryl Badra Qassis

(202) 205-3436

cqassis@usitc.gov

This article examines a U.S. government-industry project to

develop and commercialize direct ironmaking. This process

eliminates the traditional and increasingly expensive coke

processing element of steelmaking, which is considered important

to improving the competitiveness of the U.S. steel industry. This

article explores key factors affecting commercialization of direct

ironmaking, the role of industry and government institutions

involved in its research and development, the status of competing

processes abroad, and the result of the joint project.

Since this article was first published in the Industry, Trade, and

Technology Review of May 1995, the joint U.S.

industry-Government effort to develop an alternative ironmaking

process was concluded, but additional commercialization funding

has not been provided. However, several other technologies

developed abroad have moved closer to commercialization.

Beyond the already widely used Corex process, it appears that the

Russian Romelt process will be the next smelting process to be

commercialized. Competing with the smelting technologies are

several other processes that use the direct reduction method to

produce direct reduced iron (DRI). Midrex and Hylsa are already

widely used; several others are near commercialization. Given

budgetary constraints, it is unlikely that the U.S. Government will

fund further work in developing an alternative ironmaking process.

The concluding section of this article elaborates on recent

developments.

Note: A glossary of technical terms and abbreviations

(highlighted within the article by bold italics) appears at the

end of this article.

Increasing competition abroad and rising costs at home have spurred efforts by the U.S. steel

industry to develop and commercialize new technologies that will increase efficiency and

productivity, lower production costs, and improve material characteristics. A recently

concluded 5-year pilot project funded by the U.S. Department of Energy (DOE) and the

American Iron and Steel Institute (AISI) explored the technical and economic viability of
1The phrase "direct steelmaking" is often used interchangeably with the term "direct

ironmaking." Because products resulting from this process are expected to be high carbon iron,

not steel, this article will refer to the process as "direct ironmaking."

2

In bath smelting, oxygen, prereduced iron ore pellets, coal and flux are charged into a

molten slag bath containing a high percentage of carbon. Slag is an accumulation of the

impurities released from the ore that collect on the surface of the bath during smelting. The

carbon removes oxygen from the iron ore and generates carbon monoxide and liquid iron. 

Oxygen is then injected to burn some of the carbon monoxide gas before it leaves the smelting

vessel (post combustion). The heat from the burning gas then generates a portion of the energy

used in the reduction of the ore in the bath. The partially combusted gas is used to preheat and

prereduce the ore, which means removing a portion of the oxygen content before the ore is

injected into the bath. American Iron and Steel Institute, Direct Steelmaking Program, AISI, p. 4. 

3Paul Millbank. "Direct Route To Iron Gathers Momentum," Metal Bulletin Monthly

Supplement, Apr. 1995, p. 24.

4The 1990 amendments to the Clean Air Act tightened regulations on coke oven emissions.

84

direct ironmaking,1 pursuing a process based on bath smelting.

2

 The consensus of the

domestic and international steel industry is that bath smelting is the prime technology of the

future of high quality iron production for steelmaking.3 The joint project to develop direct

ironmaking in the United States is one of several efforts underway worldwide to incorporate

the smelting technology into the steelmaking process.

The purpose of the AISI-DOE direct ironmaking project was to develop a cost-effective,

efficient, and environmentally safe technology that will reduce costs and, in the long run,

increase the productivity of steel producers. For the integrated steelmaker, the blast furnace

is the primary vehicle for producing molten iron, of which coke is a major input. As

metallurgical coal reserves in the United States declined and the costs associated with

cokemaking rose, steelmakers began to pursue the direct use of coal in ironmaking,

including pulverized coal injection (PCI) in blast furnaces. These methods can partially

reduce the amount of metallurgical coke needed to produce iron (known as the coke rate),

whereas cokeless bath smelting technology would replace coke altogether.

There are several reasons the direct ironmaking project was initiated. The American steel

industry is facing potential capital investment costs, running into billions of dollars, as a

large portion of its cokemaking capacity nears the end of its design life. Increasingly

stringent environmental regulations4 have raised both the capital and operating costs of coke

oven batteries, generating the need to explore technologies that would eliminate this step

from the integrated steelmaking process. A description of the past, current, and anticipated

future processing methods of steelmaking are outlined in figure 1.

Foreign steel industries, facing similar challenges, have also pursued research in the area of

direct ironmaking technology, and two have been identified as front-runners in the race to

commercialize the technology: Corex, which has already been commercialized by Austria's

Voest-Alpine Industrieanlagenbau (VAI), and DIOS of Japan. The status of these

technologies is discussed later.

The challenge for these new processes, however, is that adoption by the industry depends

not only on the technical proficiency of the new technology, but also on proven, significant

potential for economic advantage over the traditional coke oven or blast furnace method.

86

85
5The Metals Initiative Program of 1988, which was established by the Steel and Aluminum

Energy Conservation and Technology Competitiveness Act of 1988, augments the Steel Initiative

by expanding its mandate to encompass a wider variety of metals. Its purpose is twofold: (1) to

"increase the energy efficiency and enhance the competitiveness of American steel, aluminum and

copper industries...; and (2) to continue steel research and development efforts begun under the

Department of Energy (DOE) program known as the Steel Initiative." Steel and Aluminum

Energy Conservation and Technology Competitiveness Act of 1988 Annual Report (Washington,

DC: U.S. Department of Energy, Feb. 1990).

6Egil Aukrust, AISI Direct Steelmaking Program Final Technical Report, U.S. Department of

Commerce, Technology Administration, National Technical Information Service, Springfield,

VA, Aug. 1994, p. 2.

7

J.M. Farley and P.J. Koros, AISI-DOE Direct Steelmaking Program, AISI, Jan. 30, 1992, p.

1.

8There is a large, modern installed capacity for production and transport of pellets in North

America. According to statistics compiled by Skillings Mining Review (July 30, 1994), total U.S.

and Canadian iron ore pellet plant production in 1993 was 73.7 million metric tons, with an

estimated 9 percent increase in 1994 to 80.3 million metric tons. Total annual capacity is 87.1

million metric tons. 

87

Confirming that these two criteria were achievable through the direct ironmaking process

was the goal of the AISI-DOE pilot project.

DOE's involvement in this project was made possible through legislation known as the Steel

Initiative of 1986.5 This legislation was a result of proposals by the President's Council on

Industrial Competitiveness to support joint research efforts by the industry and national

laboratories. The substance of the bill was developed by a DOE-AISI joint task force, and

mandates that costs of research and development of new technology be shared toward

achieving the purpose of saving energy, increasing competitiveness, and generating benefits

for the entire industry.

The DOE-AISI collaboration is an example of government involvement to enhance the

competitiveness of U.S. industries through cooperative technology development. The effort

to develop the direct ironmaking process for commercial use demonstrates a convergence

of interests, and is unique in light of multiple company-industry-government cooperation

and the role of environmental regulation driving new process adoption. The mixed results

of the joint AISI-DOE direct ironmaking program may have implications for future

government-industry cooperative initiatives.

DOE-AISI Pilot Project Background

In 1987, AISI assembled a task force to select the process most likely to improve

competitiveness of the U.S. steel industry and to outline a program of research and

development to facilitate rapid implementation of the technology. After an extensive review

of cokeless iron and steelmaking technologies that were already under development

worldwide, the task force concluded that future steelmaking should be based on a

coke-free, coal-based bath smelting process for the production of the hot metal that is

subsequently refined to steel.6 However, the task force determined that foreign technologies

under development did not adequately meet certain requirements of the North American

steel producer,7 including a coal-based operation that utilized pelletized iron ore feed,8 a

process that maintained the flexibility to melt scrap as well as the ability to generate excess

energy for other uses, and a process that resulted in substantial reductions in capital and
9Research related to the program was conducted at Carnegie Mellon University (CMU),

Massachusetts Institute of Technology (MIT), University of British Columbia (UBC), McGill

University (McG), McMaster University (MU), and at the U.S. Steel (USS) and the Union

Carbide Industrial Gases Technical Centers. Farley and Koros, AISI-DOE Direct Steelmaking

Program, pp. 2-3. 

10Involved organizations included International Business Machines (IBM), North American

Refractories Co. (NARCO), Linde Industrial Gases, EG&G, U.S. Steel, and Dofasco Steel, Inc.,

among others.

11Egil Aukrust, AISI, conversation with USITC staff, Mar. 13, 1995.

88

operating costs. As a result, the task force recommended that AISI propose a research and

development program for joint funding by the industry and DOE. Two years of proposal

development and assessment were involved before work on the DOE-AISI program actually

began in November 1988. The chronology of project development is outlined in table 1.

Table 1

Chronology of project development

Apr. 1987 DOE issues Steel Initiative Management Plan, which provides a framework for implementation of

research programs, and follows with a research plan identifying a number of key areas where the steel

industry could benefit from advanced technology, including direct ironmaking.

Aug. 1987 AISI assembles a task force to explore existing domestic and foreign technologies that could be

further developed to enhance the U.S. steel industry's competitiveness.

July 1988 AISI submits a research proposal to the DOE for development of a direct ironmaking process.

Nov. 1988 Work begins on the AISI-DOE direct ironmaking project.

Dec. 1988 On recommendation from the House Committee on Science, Space and Technology, Congress enacts

an amendment to the Steel Initiative, which substantially increased funding of the direct ironmaking

project.

May 1989 The AISI-DOE Cooperative Agreement for the direct ironmaking project is approved by the DOE.

Source: AISI.

Management and Funding

The projected budget of the joint AISI-DOE project was $30 million for 3 years.

Subsequent amendments extended the project to March 31, 1994, a total of 5 1/2 years, with

a total cost of $60.3 million. DOE provided $46.3 million (77 percent), while AISI provided

the remaining $13.9 million (23 percent).

Cooperating organizations provided services, personnel, equipment, and technical expertise

to the project. Research encompassed three coordinated efforts: university research9 on

 pellet-slag-coal reactions; industrial research10 on prereduction, BOF postcombustion, and

heat transfer; and research conducted at the pilot plant to experiment at the 15 ton scale with

process performance. No national laboratories were involved in this project.11

A Technical Advisory Committee consisting of senior professional personnel from the steel

industry was created to oversee technical issues and to provide individual project
12Farley and Koros, p. 3.

13Corex utilizes a dual chamber operation where solid iron ore is reduced in the upper

chamber and them melted in the lower chamber where coal and oxygen are generating heat and

reducing gases. Because the reactions are compartmentalized, coke is no longer needed to provide

burden support. In addition, lower grade coals and ores, which are more readily available

worldwide, can be utilized.

14Former Korf official, interviewed by USITC staff, Apr. 28, 1995.

15Official of the Robert Westman Co., U.S. licensee for Corex, phone interview with USITC

staff, Mar. 22, 1995.

89

managers.12 The pilot plant was located at a donated U.S. Steel site in Universal,

Pennsylvania, under the management of the AISI through a board of directors composed

primarily of industry experts from the various AISI member companies. DOE maintained

a significant involvement in the project through its membership on the board, its review of

all technical activities, and its joint effort with AISI in developing detailed progress reports

on the project. The relationships are depicted in figure 2.

Foreign Government Support of Competing Technologies

There are several competing cokeless ironmaking processes that are in various stages of

development around the world. A brief comparison of these processes and of their current

status provides a useful perspective on which to gauge the progress and objectives of the

AISI-DOE research initiative. The principal competing foreign technologies include the

Corex process, DIOS (direct iron ore smelting), HIsmelt, and Jupiter. The development of

these direct ironmaking processes have benefitted from foreign government involvement to

varying degrees.

Corex

The Corex process13 was developed when gas prices increased significantly at the end of

the 1970s. As a result, interest in natural gas-based iron ore reduction processes waned, and

interest in coal-based processes increased. Development of Corex started in 1981 and is

currently the only proven, commercialized direct liquid ironmaking technology. The

Austrian and German Governments reportedly funded the pilot plant in full, but the terms

are unclear.14

Corex has been in commercial use since December 198915 when ISCOR, the South African

steel producer, brought a 300,000 million ton per year (tpy) facility on line. Pohang Iron

and Steel Company (POSCO) of South Korea subsequently began construction of a Corex

plant in late 1992 (startup scheduled for late 1995) with an annual capacity of 700,000

million metric tonnes per year (mmtpy), effectively moving the Corex process into higher
89
16India's Jindal Group placed an order in July 1996 for a 640,000 tpy Corex plant to be built

in Karataka state to serve a new hot rolled steel plant, and a letter of intent has been signed for a

second unit. The first is expected to be in operation by late 1997. A month after the Jindal order,

South Korea's Hanbo Steel and General Construction ordered two 750,000 tpy Corex plants;

startup is expected in mid-1997. 

17"The Impact of Changes in the Iron and Steel Industry on Coal-tar Production from Coke

Ovens," Steel Times, May 1994, p. 175.

18DOE had originally approved funding to help install a Corex reactor at LTV Steel

Company's Cleveland (OH) Works. However, LTV's plans were tabled in 1994 reportedly

because earnings projections on electricity were not satisfactory. "Geneva, At Last, May Get

Corex," 33 Metalproducing, Nov. 1994, p. 9.

19Dr. Lowell Miller, Associate Deputy Assistant Secretary, Clean Coal Technology Program,

phone interview with USITC staff, May 17, 1995.

20The DIOS process uses pressure to retard gas velocity, cut coal consumption, and promote

carbon monoxide combustion. Ore pellets are fed into a fluidized bed reduction furnace at the

same time that coal is injected through the bottom. Partially reduced ore and tar then move into a

smelting furnace that is fed coal and oxygen simultaneously.

21"Research On A Next-Generation Ironmaking Process," Steel Today and Tomorrow,

July-Sept. 1994, p. 7.

22Representative of the Japan Steel Information Center, interviewed by USITC staff, Mar. 21,

1995.

23"Research On A Next-Generation Ironmaking Process," Steel Today and Tomorrow, p. 8. 

91

volume iron production. At present, Voest-Alpine has received new orders from Turkey,

India, and Korea16 for plants with production capacity up to 600,000 tpy, and there is

reported significant interest by the former Communist countries.17

The Corex process in the United States may get financial support from the DOE.

Airproducts and Chemicals Inc., Centerior Energy Corp., and Geneva Steel Co. plan to

jointly invest money in a Corex ironmaking plant to be built at Geneva's Vineyard, Utah

mill, which will produce 3,000-3,200 tons per day (tpd) of hot metal and generate 250

megawatts of electricity from byproduct gases. The Department of Energy, through its

Clean Coal Technology program, had originally approved partial funding for a Corex

installation at another steelmaker's facility. The Geneva plan envisions the DOE

contributing $150 million of the project's $825 million total cost. The partners must obtain

DOE approval to relocate18 the project to Utah, however, and negotiate the Department's

cooperative role. Negotiations, presently underway, are expected to conclude in July, 1995.

A 1999 operational start-up date is expected.19

DIOS

The DIOS process20 has been the subject of cooperative research between the Japan Iron and

Steel Federation (JISF), Japan's eight integrated steelmakers, and the Center for Coal

Utilization in Japan. According to the Japan Iron and Steel Federation, the research project

has been supported since 1988 with subsidies and aid by the Ministry of International Trade

and Industry (MITI).21 The 7-year project was budgeted at 13 billion yen (approximately

$100 million), two-thirds of which was provided by MITI.22 In developing the DIOS

process, JISF has been holding technology exchange meetings with counterparts of various

countries in an attempt to foster international cooperation in the technology development

process.23

Operations at the 500 tpd pilot plant at NKK Keihan's works began in December 1993 and
24HIsmelt uses a circulating fluid bed reactor for preheating and prereduction. Hot blast air is

used for the initial combustion of the coal because the nitrogen in the air is believed to promote

heat transfer and to control postcombustion temperatures. Smelting begins with the bottom

injection of coal which is dissolved in the bath. The dissolved carbon is used to reduce the iron

ore, releasing carbon monoxide which is post-combusted by injecting oxygen in the bath.

25Official of Midrex Corp., interviewed by USITC staff, Mar. 21, 1995.

26The Jupiter process is unique in that coal gasification occurs in the reduction process (the

others are based on the gasification of coal in the smelting reaction and on the direct use of the

resulting gas in the reduction, both reactors being physically and metallurgically linked), and,

therefore, secures the reducing gas and energy requirements. In this first step, it delivers a

mixture of directly reduced iron and char, which is used in a melting process using both fossil fuel

(residual char) and electric energy. The resulting gas from melting is thus not used for reduction.

27Funds for ECSC research grants are drawn from monies collected from producers via a

tonnage-based production levy.

92

will run through 1995, at which time a formal assessment will be made by the participating

companies as to the success of the project. According to JISF, the DIOS process is expected

to reduce costs by about 10 percent and to cut carbon dioxide emissions 5 to 10 percent

compared with blast furnace ironmaking. Other anticipated benefits include the direct use

of nonmetallurgical coal for greater flexibility in selecting resources (Japan has no

metallurgical coal reserves) and facility and energy cost reductions because of the

elimination of the iron ore sintering and cokemaking processes. Full commercialization of

DIOS is expected by the year 2000.

HIsmelt

The Australian company CRA Ltd. and Midrex Corporation of North Carolina formed a

50-50 joint venture in 1989 to develop a direct smelting process, known as HIsmelt.24

These partners have spent approximately $200 million developing the process, including the

construction of a 150,000 tpy demonstration plant at the HIsmelt Research and Development

in Kwinana, Western Australia. HIsmelt has been entirely financed by the two partners,

without any government support.25 HIsmelt is ideal for Australian steel producers because

it is suited to Australia's Pilbara iron ores, and for iron production using low-cost iron ores

and nonmetallurgical coals.

Jupiter

The European program, Jupiter,26 was the result of an initiative started in 1989 by the

French steelmaker Usinor-Sacilor looking for a smelting reduction process to supply virgin

metal to electric steelmaking plants. The development of the Jupiter concept was supported

by research work by IRSID (Usinor-Sacilor Process Research Center). Jupiter received

partial funding from the European Coal and Steel Community (ECSC), a predecessor to the

European Union.27 The remainder of the financial support was generated by the three

European companies: Usinor, Lurgi, and Thyssen Stahl. Although demonstration of the

feasibility of the reduction process on a pilot plant scale was under discussion, the Jupiter

program was apparently abandoned last year.

Research Goals and Results
28AISI, Direct Steelmaking Program, p. 4.

29Ibid.

30Ibid, p. 2.

31International Iron and Steel Institute, Steel Statistical Yearbook 1994, Committee on

Statistics, Brussels, 1994, pp. 12-13.

32American Iron and Steel Institute, "AISI Direct Steelmaking Findings Encouraging, Lead to

New Research on Waste Oxide Recycling," press release, AISI, Washington, DC, May 18, 1994,

p. 1. 

33The nozzles through which the hot blast of air is directed into the smelting vessel.

34Aukrust, AISI Direct Steelmaking Program Final Technical Report, p. 8.

93

AISI directed its research efforts in the direct ironmaking project to address perceived

deficiencies in the other technologies being developed abroad. For example, the AISI task

force had determined that the most advanced process, Corex, which was operating on a

demonstration basis in South Africa at the time, was inadequate since it did not employ the

post-combustion process needed to ensure thermal balance. In addition, the economic

viability of the Corex process, largely based on the significant byproduct production of

low-BTU gas, was questioned by the task force.28

The AISI-DOE project sought to develop optimum designs and operating techniques for the

smelter and associated equipment as well as to solve engineering problems involved in

making the process work economically on a commercial scale.29 AISI initially expected that

its process would have reduced direct operating costs by $10 to $25 per ton of steel

produced, compared to the present coke oven-blast furnace-basic oxygen furnace (BOF)

technology. The energy cost savings are estimated at about 20 percent.30

In addition, AISI believed that its research had potential for application by minimill (nonintegrated) producers using the electric arc furnace (EAF), which account for almost 40

percent of the steel produced in the United States today and 31 percent of steel produced

worldwide.31 AISI's direct ironmaking process was intended to enable the iron to be cast

into "pigs" that could compete economically as input in EAF production with high-quality

scrap, which is becoming more scarce worldwide.

The joint AISI-DOE direct ironmaking project ended in March, 1994, revealing a gap

between the actual results obtained at the pilot plant and the established goals for

productivity and fuel rate. This gap, which affects both capital and operating costs, is

estimated to be approximately 40 percent in the case of high volatile coals. Nevertheless,

AISI expressed optimism that the gap can be closed by addressing the deficient aspects of

the process.32 These include improved distribution of oxygen through the application of

side-blown tuyeres,33 better distribution of raw materials in the reaction vessel, the use of

newly developed sensors to measure foam height and to observe char distribution and

behavior within the pressurized vessel, and cooperative information exchanges with other

smelting programs.

According to AISI's final technical report, the pilot plant project indicates that the process

fundamentals, on which the joint program was initiated, are valid. Further, it notes that

despite the shortfalls, several steel companies view the results to be sufficiently encouraging

to consider building a demonstration plant.34 Comparative savings in the capital and

operating costs for the coke oven-blast furnace and AISI processes of ironmaking are
35Ibid, p. 1.

36The estimated costs include stirring the bath with nitrogen. It is expected that nitrogen will

eventually be replaced with air, at a savings of $1.40 per metric ton. Other items, including better

hot metal desulfurization and the substitution of fluxes, could result in additional savings,

according to AISI.

94

projected to be in excess of ten percent.35 A cost comparison is reflected in table 2.

Table 2

Projected cost advantages of AISI's direct ironmaking process v. existing coke oven/blast

furnace1

Coke oven/ AISI

Basis blast furnace process

 Dollars per annual metric ton 

Capital

costs ............... 243 160

 Metric tons per day per cubic meter 

Production 

intensity ............ 1.0 4.6

 Dollars per metric ton 

Operating 

costs ............... 131 120

 

1 Costs are per annual metric ton of hot metal based on plants with hot metal capacity of one million metric

tons per year.

Source: Aukrust, AISI Direct Steelmaking Program, pp. 139-40.

The reported significant cost advantage of the AISI process derives in part from its much

greater process intensity. These data reflect the much smaller size of the AISI smelter

compared with other units of similar production capacity, which substantially reduces

construction costs. Finally, with regard to the variable operating cost estimates for the two

processes, certain cost factors could further decrease the AISI cost by up to $5 per metric

ton through scaleup or maturation.36

Based on the findings of the direct ironmaking pilot project, AISI and DOE launched

another cooperative pilot project, the Steel Plant Waste Oxide Recycling and Resource

Recovery by Smelting Program in April, 1994, to determine the feasibility of converting

steel plant waste to pig iron for use in steelmaking or foundry industries. According to AISI,

the steel industry currently generates three million tons of blast furnace and basic oxygen

furnace dusts and one half-million tons of rolling mill sludge each year. The Waste Oxide

project is aimed at recovering these wastes, most of which are currently disposed of in

landfills, a process that is growing increasingly expensive. Further, it is estimated that
37American Iron and Steel Institute, "Waste Oxide Recycling Demonstration Weighed as Pilot

Project Successfully Concluded," press release, Jan. 30, 1995.

38Like the direct ironmaking project, the DOE's contribution of the waste oxide project is

funded by the Metals Initiative.

39They include Acme Metals, Cleveland-Cliffs, Geneva Steel, Georgetown Industries,

HARSCO, Inland Steel, LTV Steel, Lukens, National Steel, Rouge Steel, Stelco, USS Kobe, and

USX. Additional financial assistance will be provided by principal subcontractors and suppliers,

including Mannesmann Demag, Hatch Associates, and NARCO Research.

40The feasibility study will quantify the potential economic return on a smelter at the Lake

Erie Works plant of Stelco and should provide the information necessary for proceeding with a

proposal for a demonstration plant by the spring of 1995, according to AISI. The smelter would

be designed to process about 600,000 tpy of waste oxides and to produce about 250,000 tons of

hot metal per year.

41Researchers have learned how to optimize the direct ironmaking process by understanding

better such issues as the dissolution of materials, reduction mechanisms and rates, slag foaming

and control, the behavior of sulfur, dust generation, and the entire question of energy

efficiency--including postcombustion and the role of coal volatile matter. 

42Aukrust, AISI Direct Steelmaking Program Final Technical Report, p. 9.

95

widespread recycling of steel plant wastes could save 10 trillion BTU of energy per year.37

The Waste Oxide project further broadens and enhances the basic smelting technology

developed by the direct ironmaking project. It is directed by the same AISI team and uses

the same pilot plant built for the direct iron smelting project. DOE is providing 70 percent

of the project's $7 million cost,38 and AISI members are responsible for the remaining 30

percent. AISI's portion is funded on an elective basis by 13 of its member companies.39

In January, 1995, AISI announced that the waste oxide pilot project had been successfully

completed, laying the groundwork for a possible commercial demonstration project. Project

directors determined in December that no further trials were required, ending the project 2

months ahead of schedule. The engineering firm of Mannesman DeMag was commissioned

to work with AISI on conducting a feasibility study of the economic returns of a full-scale

demonstration project for the waste oxide technology.40 If the feasibility study shows that

the process is expected to be viable commercially, AISI will proceed with a proposal to fund

the demonstration plant.

Conclusions

Confirming the potential for the direct ironmaking process examined by AISI-DOE to

clearly achieve economic advantages and technical proficiency over existing production

methods--the two primary goals of the pilot project--was not sufficiently demonstrated to

justify commercialization without further research. However, significant knowledge was

gained from laboratory and pilot testing41 to enable researchers to learn how to optimize the

direct ironmaking process and to provide the foundation for future research.42 Major

obstacles stand in the way of the commercialization and the subsequent adoption of the

DOE-AISI, or of any other, direct ironmaking process in the United States, including the

level of capital investment that would be required. Given the capital intensity of the modern

steel industry, new technologies must ensure a net reduction in cost over the existing

process. This has not been proven definitively by the DOE-AISI pilot project.

Although the direct ironmaking project has not proven the economic feasibility of the
43Department of Energy, Office of Industrial Processes, “Executive Summary: Steel Projects,”

found at http://www.oit.doe.gov/IOF/steel/exsum.html, retrieved on Nov. 19, 1997.

44Telephone conversation with Bob Trimberger, Department of Energy, Office of Energy

Efficiency and Renewable Energy, Nov. 19, 1997. 

96

technology in terms of commercialization, it launched a new step in developing bath

smelting for ferrous products, which, as it turns out, will be viable in a wider range of

applications, as exemplified by the waste oxide project. The success of the joint AISI-DOE

Steel Plant Waste Oxide Recycling and Resource Recovery by Smelting Program, which

was spawned by the direct ironmaking project, indicates the value of the basic research

which facilitated the development of bath smelting technology to a stage where it could

serve as a foundation to launch the new project. It is possible the new information learned

during the research trials conducted at the waste oxide pilot plant could further the

development of the direct ironmaking process if the project is revisited at a future time.

AISI has not announced any specific time frame, however, on this score. 

According to government and industry officials the administrative partnership between the

government and the industry worked well. The industry was able to proceed with research

important to its future and leveraged its investment almost three-fold. The joint project

lends support to the concept that government-industry cooperation can contribute positively

to the drive for technology innovation in the domestic steel industry.

Recent Developments

Over the last 2 years, efforts to develop alternative ironmaking processes have intensified

throughout the world, but no new processes have been commercialized. New DRI plants

based on proven technologies, including Corex, Hylsa, and Midrex, have mushroomed,

while other technologies are just getting off the ground, including the process developed by

the U.S. steel industry. However, the lack of U.S. Government funding has now caused the

industry to seek alternative routes towards commercialization. 

The Steel Plant Waste Oxide Recycling and Resource Recovery by Smelting project, which

evolved from the Direct Ironmaking Project, yielded promising results. The project

demonstrated the complete conversion of all forms of steel plant waste oxides, including

those high in zinc, to useful products: molten pig iron, slag for roadbed or cement

production, clean off-gas as fuel, and a zinc-rich raw material for the nonferrous industry.

The pilot plant trials established that energy savings up to 25 percent in the blast furnace and

coke oven processes are achievable in this process.43 The recycling project concluded in

1996. The Department of Energy (DOE) provided $5.6 million (67 percent) and the industry

cost-share (provided by AISI and Mannesmann Demag) was $2.6 million.44 An AISI

proposal for a commercial demonstration plant to convert 500,000 metric tons per year (tpy)

of waste oxides to 250,000 metric tpy of hot metal was submitted to the DOE, but

Government funding was not available. However, the AISI is reportedly still interested in
45Ibid.

46Department of Energy, Office of Industrial Processes, “Steel: Industry of the Future --

Fall/Winter 1996 Update,” found at http://www.oit.doe.gov/IOF/steel/, retrieved on Nov. 19,

1997.

47As part of this initiative, the steel industry published “Steel: A National Resource for the

Future,” in May 1995, which is known as the “Steel Industry’s Vision Report.” This report laid

the ground work for its Technology Roadmap. AISI listed three overriding priorities in its

Technology Roadmap: product efficiency, recycling, and environmental engineering. AISI, Steel

Technology Roadmap, found at http://www.intervisage.com/AISI/MandT, retrieved Oct. 10, 1997.

48New Steel, “Posco’s Corex Plant Passes the Million-Ton Mark,” Nov. 1997, p. 14.

49John Schrieffer, “Increasing R&D’s Productivity,” New Steel, June 1996, p. 75.

50Robert Brooks and George W. Hess, “Searching for Tips on Mill Waste Recycling,” 33

Metalproducing, Aug. 1996, p. 54.

97

pursuing the technology and is in the process of seeking partnerships outside the United

States for further development.45

Despite the lack of government funding, developing an ironmaking technology continues

to be a priority for the U.S. industry as well as the U.S. Government. Indeed, steel is among

seven energy- and waste-intensive industries that are participating in DOE Office of

Industrial Technologies new collaborative R&D strategy called “Industries of the Future”

which is intended to result in the demonstration, evaluation, and acceleration of new

technologies and scientific insights named as priorities by the industries.46 To achieve this

goal, AISI has created a tactical agenda, or a “Technology Roadmap,” which identifies the

critical technical advances that the steel industry believes are necessary for steel to remain

“the material of choice” into the next century.47 A major goal is to develop and

commercialize an alternative ironmaking process. The industry predicts that in the next 15

to 20 years there will be a shift away from the traditional blast furnace method of iron

production technologies; utilization of these new technologies will be key to future

international competitiveness. Advances in both iron smelting and direct reduction

technologies are discussed below.

Developments in Iron Smelting Technology

Among the iron smelting technologies, the Corex process, which uses coal directly to

produce liquid hot metal, is the only process commercially available. Corex plants are in

operation in South Africa, India, and Korea. Posco’s (Korea) Corex facility has produced

more than 1 million metric tons of hot metal since its startup in November 1995.48 Posco

is the second Corex plant to become operational, after Iscor (South Africa) which was

commissioned in 1989. Plans by Geneva Steel, Air Products, and Centerior Energy to work

with DOE in developing a combined ironmaking and energy generating facility using the

Corex technology has been on hold pending final DOE approval, which Geneva officials say

they do not anticipate any time soon.49 

The Romelt process, developed by the Moscow Institute of Steel and Alloys, is reportedly

ready for commercialization, with worldwide development rights split between ICF Kaiser

International and Nippon Steel.50 Romelt is a bath smelting process for converting iron

oxides (virgin ores or waste materials) into blast furnace grade pig iron using noncoking

coals. During the testing of AISI’s Waste Oxide Recycling Program, which uses similar

technology, the team consulted with Romelt’s team and sent material to their pilot plant for
51Telephone conversation with Bob Trimberger, Department of Energy, Office of Energy

Efficiency and Renewable Energy, Nov. 19, 1997. 

52AISI Steel Technology Roadmap.

98

testing.51 As for the other smelting technologies under development, pilot plants have been

built but no dates have been set for commercialization.52 Table 3 presents descriptions of

the various iron-smelting technologies under development or in use.

Table 3: Main iron smelting technologies, feed material used, and changes in status since original article.

Process Feed Changes in Status

AISI Coal/pellets or waste oxides Smelter tests complete; AISI looking for partner to

further develop technology after loss of U.S.

Government funding.

Ausmelt Fine and lump coal and any iron

source (wide range of suitable

feed materials)

Being developed in Australia by Ausmelt Pty; a

pilot plant in Victoria has been proven at 1-5 t/d. A

new 1-3 t/h (2t ore/hr) pilot plant is now planned.

Cyclone Converter

Furnace (CCF)

Coal/fine ore Cyclone furnace tested (not linked to smelter).

CleanSmelt Coal/fine ore Cyclone and smelter tested in combination.

Corex Coal/pellets or lump ore 3 plants operating, several others planned.

DIOS Coal/fine ore Pilot plant closed in 1996.

Hismelt Coal/fine ore Pilot facility operating.

Romelt Coal/ore or waste oxides Semi-commercial plant built, worldwide

development rights split between ICF Kaiser

International and Nippon Steel.

Source: Compiled from various industry sources.

Developments in Direct Reduction Technology

Midrex and the Hylsa processes, both gas-based direct reduction technologies, are the oldest

and most widely used technologies, producing over 90 percent of direct reduced iron

worldwide. The Midrex process dominates, generating more than 60 percent of total DRI

production (table 4). 

A description of the direct reduction technologies currently in use or under development are

presented in table 5. Midrex and the Hylsa technologies will likely dominate into the new

century, given the number of new plants planned or under construction throughout the

world.

Table 4: World DRI Production by process in 1995 and 1996, in million metric tons
53John Schrieffer, “Increasing R&D’s Productivity,” New Steel, June 1996, p. 78.

54Ibid.

99

Process 1995 1996

Midrex 19.86 21.00

HYL III 5.76 6.31

HYL I 2.39 2.81

SL/RN 1.02 1.08

Others 1.64 2.08

TOTAL 30.67 33.28

Source: Midrex Direct Reduction Corp.

Outlook

Development and implementation of these technologies will increase into the new century,

and although government collaboration may continue to be pursued, the industry will likely

seek other avenues to support R&D and commercialization efforts. Indeed, although the

U.S. industry continues to pursue joint efforts to develop an ironmaking process in a

collective fashion, a number of U.S. firms are moving independently to develop and

implement certain existing technologies in their own production processes. They are also

pairing up with other domestic and foreign firms, partly in an effort to minimize the costs

involved. For example, LTV recently formed a joint venture with Cleveland-Cliffs and

Lurgi (Germany) to build the first commercial-scale Circored plant in Trinidad. LTV

researchers helped evaluate the technology and will assist in implementation as the project

progresses.53 Meanwhile, Nucor has joined efforts with U.S. Steel and Praxair (U.S.) to

develop a new steelmaking process using iron carbide. The process would use oxygen and

iron carbide to make steel in a self-contained vessel, which would eliminate the need for a

blast furnace, coke, or electricity. However, before building a pilot plant, Nucor needs to

determine if it can produce quality iron carbide economically at its Trinidad plant.54
100

Table 5: Main direct reduction technologies, and current status.

Process Status

Gas-Based

Midrex Commercially available since 1971. Plants operational in Argentina,

Canada, Egypt, Germany, India, Iran, Libya, Malaysia, Nigeria, Qatar,

Russia, Saudi Arabia, Trinidad and Tobago, the United States, and

Venezuela. Additional plants planned or under construction in Egypt,

Korea, Mexico, South Africa, the United States, and Venezuela. 

HYL I and HYL III Commercially available since 1976. Plants operational in Brazil,

Indonesia, Iran, Malaysia, Mexico, and Venezuela. Additional plants

planned or under construction in Iran, Mexico, Russia, and Saudi Arabia.

Finmet Developed by VAI to improve on the Fior process (Venezuela). Finmet

plants are being built in Venezuela and Australia.

Spirex Being developed by Midrex Direct Reduction Corp. and Kobe Steel.

Construction of a 30,000 tpy demonstration plant was slated to begin in

late 1997 in Puerto Odaz, Venezuela, at Kobe’s Opco site. 

Iron Carbide Developed by Gordon Geiger, this process produces a variant of DRI

called iron carbide. Nucor plant operating in Trinidad; Qualitech’s plant is

under construction and due to start up in 1998.

Circored Developed by Lurgi, uses circulating fluidized-bed (CFB) reactor. The first

commercial plant will start up in mid-1998 in Trinidad and Tobago to

supply HBI to the U.S. market. A joint venture with iron ore miner

Cleveland Cliffs Inc. (46.5%), steelmaker LTV (46.5%), and plantmaker

Lurgi (7%). 

Coal-Based

SL/RN (Stelco, Lurgi, Republic

Steel Co., Nation Lead Corp.)

Currently operating plants in India, Peru, and South Africa; two more are

planned for India.

Inmetco Developed by Inco of Canada; installing a 400,000 tpy unit at Nakornthai

Strip Mill Public Co. in Thailand.

Fastmet Developed by Midrex and parent company Kobe Steel; is currently being

developed and demonstrated at a 3 t/h unit at Kobe’s Kakogawa work in

Japan. A plant is planned for Thailand.

Comet Developed by the Belgian steel research organization CRM and following

extensive laboratory tests a demonstration plant is now under construction

at Sidmar’s plant near Gent. 

Circofer Developed by Lurgi; Circored’s sister technology. Still in testing stages.

Source: Compiled from various industry sources.
55Definitions are drawn primarily from U.S. Department of the Interior, Bureau of Mines, A

Dictionary of Mining, Mineral and Related Terms, Washington, DC, 1968, and from American

Iron and Steel Institute, Steelmaking Flowlines, Washington, DC, 1982.

101

Glossary of Terms55

BOF Basic Oxygen Furnace. The chief method of producing steel. The

furnace is charged with molten iron from a blast furnace and steel

scrap. Oxygen is blown into the furnace at high velocity to speed

combustion and refine the iron and scrap.

Blast furnace Cylindrical steel vessel, lined with heat-resistance brick, which,

once charged with coke, iron ore, and limestone and heated,

produces molten iron for further refining in a steelmaking furnace.

Coke A lumpy, porous form of carbon produced by the baking of coal to

drive off its volatile elements so that the fixed carbon and the ash

are fused together.

EAF Electric Arc Furnace. A furnace in which iron and steel scrap,

limestone, and other additives are melted and converted to steel.

Heat supplied by an electric arc melts and refines the charge.

Flux In chemistry and metallurgy, a substance that promotes the fusing

of minerals or metals or prevents the formation of oxides.

Iron ore pellet A blast furnace raw material made by the beneficiation

(concentration) of low grade ores. Pellets are marble-sized and

increasingly contain flux as well as iron ore and a binder.

Integrated Method of steelmaking, typically with BOF, that makes steel from

the virgin material of iron ore, coal, and limestone.

Non-integrated Steelmaking methods that make new steel, usually in an electric arc

furnace, from scrap steel.

High-volatile coals Coals containing over 32 percent of volatile matter.

Metallurgical coal Certain coals possessing characteristics that make them suitable for

producing metallurgical coke.

Metallurgical coke A coke with very high compressive strength at elevated

temperatures, used in metallurgical furnaces, not only as a fuel but

also as a support for the weight of the charge.

Pig iron High-carbon iron made by the reduction of iron ore in the blast

furnace.

Postcombustion In smelting, the injection of oxygen to burn off some of the carbon
102

monoxide gas before it leaves the smelting vessel.

Scrap The principal metallic charge to electric furnaces. Scrap is also

typically used as part of the charge in BOFs. It is classified as

"home scrap" (croppings originating in steel mills), "prompt

industrial scrap" (trimmings returned by steel users) and "dormant,

or obsolete, scrap" (the materials collected and processed by

dealers).

Sintering Process that uses the fine, iron-bearing materials recovered from

ore handling, iron and steel operations, and environmental control

equipment and partially fuses these fine particles into 1/4-inch

material to be used in ironmaking.

Slag In the smelting process, an accumulation of impurities released

from the iron ore that collects on the surface of the molten iron.

Smelting The chemical reduction of a metal from its ore by a process usually

involving fusion, so that the earthy and other impurities, separating

as lighter and more fusible slags, can readily be removed from the

reduced metal.
,,,,,,,,,,,,,,,,

PART II

OTHER MATERIALS

TECHNOLOGY RESEARCH
1Thermoplastic materials are those that can be reshaped with the application of heat.

2Materials that “. . . can be stretched to at least double their length at room temperature and,

on the removal of the tension, quickly return to their original length.” K.F. Heinisch, Dictionary

of Rubber (New York: Halstead Press Book, 1966), p. 189. The term elastomer is essentially

synonymous with rubber; the two words will be used interchangeably throughout this article.

3Thermoset materials are those that cannot be reshaped through the application of heat

because of the existence of chemical bonds that cannot be broken through changes in temperature.

4Marc S. Reisch, “Thermoplastic Elastomers Target Rubber and Plastics Markets,” Chemical

and Engineering News (C&EN), vol. 74, No. 32 (August 5, 1996), p. 11.

5Reisch, “Thermoplastic Elastomers,” p. 10.

105

Thermoplastic Elastomers in the Auto

Industry: Increasing Use and the Potential

Implications

Elizabeth Howlett

(202) 205-3365

ehowlett@usitc.gov

Thermoplastic1 elastomers2 (TPEs) are a group of specialty rubbers

that combine the elasticity of thermoset3 rubbers with the processing

advantages of plastic materials. TPEs have continued to enjoy

growth in a wide range of applications during the 1990s. The

automobile industry, which is currently the largest consumer of

TPEs, is expected to increase its use of these materials by more than

7 percent annually between 1995 and 2000, to reach 1.1 billion

pounds.4 During the same period (1995-2000), consumption of

thermoset rubber for all industries is estimated by industry sources

to increase to 38.2 billion pounds, an average annual growth rate of

2.7 percent. By comparison, total TPE consumption is expected to

increase from 1.9 to 2.5 billion pounds, an average annual increase

of 5.6 percent.5 The disparity in growth rates is indicative of a

growing trend in certain sectors, such as the auto industry, toward

replacing thermoset rubbers and rigid thermoplastics (e.g., polyvinyl

chloride) with thermoplastic elastomers. In addition, auto

producers are developing new products specifically designed to use

the unique characteristics of TPEs. This article provides an

overview of the advantages that TPE materials offer manufacturers,

examines use of TPEs in the auto industry, and briefly looks at the

role of TPEs in other sectors.

This article was originally published in the Industry, Trade, and

Technology Review of January 1998.

Thermoplastic elastomers (TPEs) are a rapidly growing class of specialty rubber materials

that demonstrate a unique combination of performance and processing characteristics,

blending both thermoplastic (or plastic) and rubber properties. Compared with rubbers,

plastics are generally easier to process because they can be reshaped with heat and do not
6Most elastomers owe their elasticity to crosslinking, by which molecular bonds are formed

across polymer chains, allowing the material to sustain significant deformation and still return to

its original shape once deforming stress has been eliminated. By comparison, thermoplastic

materials, which lack the crosslinks that allow for elasticity, are typically more rigid than

thermosets. However, they do not take a permanent shape through initial processing; with

minimal effect on performance and processing, plastics can be reshaped by applying heat. P.W.

Allen, Natural Rubber and the Synthetics (London: Crosby Lockwood, 1972), pp. 14-15.

7A TPE comprises at least two intertwined polymer systems, where one is a rigid

thermoplastic material and the other is a soft elastomeric material. The TPE is intended to be used

between the softening temperature of the two polymers. When temperatures fall below the

softening point of the rigid phase, it acts as a backbone to restrict movement of the soft phase

polymer. However, when heated above the softening temperature of the hard phase, the TPE loses

its shape and becomes a viscous liquid. The hard phase resolidifies upon cooling, allowing for

reshaping of the material. For thermoset rubbers, modifying shape to a significant degree involves

the cleavage of chemical bonds. Charles A. Rader, “Thermoplastic Elastomers: Non-tire Market

Share Up to 11% as Production Reaches 420,000 Tonnes,” Modern Plastics, vol. 72, No. 12

(Mid-November 1995), p. B-56.

8Reisch, “Thermoplastic Elastomers,” p. 11.

9

Information obtained from the International Institute of Synthetic Rubber Producers’ website

(http://www.iisrp.com/) on Sept. 4, 1997.

10Kerri Walsh, "Automotive End Uses Drive Demand,” Chemical Week, vol. 159, No. 25

(June 25, 1997), p. 36.

11There is no consensus on the exact types of TPEs, but the five classes used here are

reasonably common.

12Bernie Miller, “TPO Takes the Fast Lane to Big-Time Applications,” Plastics World, vol.

53, No. 10 (October 1995), p. 43.

13Exterior automotive parts include bumpers, cladding and side trim, wheel flares, and front

grilles.

14Other interior applications include skins to cover dashboards and door panels, improving

their tactile properties.

106

have the temperature restrictions of thermosets. For these reasons, manufacturers typically

prefer to work with plastic materials if possible. For some purposes, however, the elastic

properties of thermoset rubbers are favored over the comparable rigidity of plastics.6 By

offering a combination of the easy processing of a thermoplastic component and the

elasticity of a rubber, TPEs have become desirable for many applications, particularly in the

auto industry.7

World consumption of both natural and synthetic thermosetting rubber has been relatively

stable in recent years, while TPEs have experienced steady growth8 (figure 1), estimated at

11 percent over the 3-year period of 1995-97. Total worldwide consumption in 1996 for

synthetic and natural rubber, totaling 21.2 billion pounds and 13.2 billion pounds,

respectively, far exceeded the 2.0 billion pounds of TPE consumed in the same year.9 The

automobile industry reportedly consumes 31 percent of all TPE produced.10

Materials classified as TPEs generally fall into five groupings, as outlined in the shaded text

box.11 Styrene block copolymers (SBCs) are the most commonly used TPE (figure 2),

accounting for about 50 percent of consumption. However, it has been projected that

thermoplastic olefins (TPOs), used extensively in the North American auto industry, will

have an average annual growth of almost 10 percent for model years 1995-2005, increasing

from 165.0 million pounds to 425.0 million pounds (table 1).12 The majority of the TPOs

currently are used in the exterior13 of vehicles, although the most substantial growth will

come from increased use for interior applications, such as airbag covers.14 Annual growth
15Although use of TPOs in underhood body parts, including air intakes, boots and bellows,

and splash shields, exceeded that of interior parts for 1995, it is anticipated that by 2005 interior

parts will use 34.1 million pounds, while underhood parts will use 28.6 million pounds. Miller,

“TPO Takes Fast Lane,” p. 43.

107

Source: Compiled by USITC staff from data obtained from the IISRP website 

(http://www.iisrp.com/) on Sept. 10, 1997.

Source: Marc Reisch, “Thermoplastic Elastomers Target Rubber and Plastics Markets,” C&EN, vol. 74, No. 32

(August 5, 1996), p. 14.

rates during 1995-2005 for TPOs in the auto industry are estimated at more than 9 percent

for exterior parts compared with 34 percent for interior parts.15
108
109

Major Types of Thermoplastic Elastomers

C Styrene block copolymers (SBCs) are the least expensive ($0.70-$2.50 per pound) and most

commercially successful category of TPEs. SBCs include three main subcategories: styrenebutadiene-styrene (SBS), styrene-isoprene-styrene (SIS), and styrene-ethylene-butylenestyrene (SEBS). SBS is frequently used in footwear, consumer products, asphalt, and

polymer modification. Its most significant shortcoming is poor resistance to oil and high

temperatures. SIS is frequently used in the adhesives industry because of its softness and ease

of combining with resins, oils, and solvents. The most recent innovation, SEBS, was

designed to be resistant to oxidation and weather; it is well-suited to applications such as

automotive weatherstripping and cable coatings.

C Thermoplastic olefinics (TPOs) are composed of a thermoplastic, such as polypropylene, that

has been blended with an unvulcanized rubber. TPOs can be relatively rigid materials, with

hardness ranging from 60 Shore A to 60 Shore D at room temperature. For this reason, they

are used in applications such as automobile bumpers and fascias, where impact resistance is

critical. While TPOs have fair resistance to some chemicals, their resistance to chlorinated

hydrocarbon solvents is low. TPOs generally fall within the price range of $0.75-$1.00 per

pound.

C Thermoplastic urethanes (TPUs) have soft segments of either a polyester or polyether

macroglycol paired with hard segments that are the product of the reaction between lowmolecular-weight glycol and diisocyanate. TPUs are noted for high UV resistance, excellent

tear strength, and good abrasion resistance, which make them a good alternative to traditional

rubbers. TPUs are attractive to the auto industry because they do not need a primer before

being painted. Significant weaknesses include poor resistance to strong acids and steam. 

TPUs are typically priced at $2.50 or more per pound.

C Thermoplastic copolyester elastomers (COPEs) have alternating hard segments, usually an

ester, and soft segments, usually an ether, which give them a unique set of performance

characteristics. COPEs are relatively easy to process, are resistant to oil and many chemicals,

and have good flex resistance across a broad range of temperatures. Their high cost ($2.40-

$3.60 per pound) prohibits use in many applications, although they are suited for use in

selected blow-molded auto underbody parts.

C Thermoplastic vulcanizates (TPVs) have two phases, a finely dispersed thermoset rubber

phase and a polyolefin continuous phase. The vulcanized rubber phase improves compression

set, chemical resistance, and thermal stability. Because of the superior processing

characteristics of TPVs, they are seen as a reasonable replacement for thermoset rubbers even

though the cost of raw materials for TPVs is higher. TPVs generally cost between $1.40 and

$2.00 per pound and are used in automotive boots and bellows, hose and tubing, and other

applications.

Source: Compiled by USITC staff from “Elastomers and Rubbers: Thermoplastic Elastomers,” Machine Design,

vol. 68 , No. 3 (Feb. 8, 1996), p. 82; Malcolm Thompson, “TPEs Open the Door to Better Designs,” Machine

Design, vol. 65, No. 15 (July 23, 1993), pp. 47-49; Charles A. Rader “Thermoplastic Elastomers: Non-tire

Market Share Up to 11% as Production Reaches 420,000 Tonnes,” Modern Plastics, vol. 72, No. 12 (MidNovember 1995), p. B-57.
16Extrusion, a common plastics processing technique, involves heating the material in a

cylinder and then forcing it through a die with a rotating screw. Sheets, rods, bars, and tubes can

be made by extrusion. Douglas M. Considine, ed., Chemical and Process Technology

Encyclopedia (New York: McGraw-Hill Book Company, 1974), p. 884.

17Injection molding is a process in which granulated thermoplastic materials are heated and

then forced into a mold of the desired item. Usually the molds are standardized, which limits the

part sizes and shapes that can be made. Considine, ed., Chemical and Process Technology

Encyclopedia, p. 883.

18Reisch, “Thermoplastic Elastomers,” p. 11.

19Peter Mapleston, “New Grades and Processes Expand TPE Capabilities,” Modern Plastics,

vol. 73, No. 5 (May 1996), pp. 64-65.

110

Table 1

North American TPO usage in cars and light trucks for 1995, and projected usage for 2000

and 2005, in million pounds; annual growth rate, 1995-2005

Application 1995 2000 2005

Annual growth

rate, 1995-2005

(Percent)

Type of part:

 Exterior:

 Bumper systems (incl. fascia, trim, strips) ..... 100.0 220.0 280.0 10.8

 Cladding, side trim ....................... 20.0 35.0 35.0 5.8

 Wheel flares ............................ 6.0 6.5 6.8 1.2

 Front grilles ............................. 3.0 8.0 12.0 14.9

 Other trim .............................. 18.5 22.6 28.5 4.4

 Subtotal, exterior parts ................ 147.5 292.1 362.3 9.4

 Interior:

 Airbag cover ............................ 1.8 6.3 8.1 16.3

 PVC skin replacement .................... 0 10.0 20.0 (

1

)

 Other interior ............................ 0 4.0 6.0 (

1

)

 Subtotal, interior parts ................. 1.8 20.3 34.1 34.2

 Underhood, Body:

 Air intake (blow mold) ..................... 13.4 18.3 22.0 5.1

 Boot, bellows (blow mold) .................. 0.2 0.4 0.6 11.6

 Splash shields .......................... 2.0 4.0 6.0 11.6

 Subtotal, underhood/body parts .......... 15.6 22.7 28.6 6.2

 Total 164.9 335.1 425.0 9.9

Comparative measures:

 Vehicles produced (million) .................. 13.0 13.3 13.5 0.4

 Pounds/vehicle ........................... 12.7 25.2 31.5 9.5

 

1

 Not applicable because the quantity is zero for the initial year under consideration.

Source: Bernie Miller, “TPO Takes Fast Lane to Big-time Applications,” Plastics World, vol. 53,

No. 10 (October 1995), pp. 42-48.

Processing Advantages of TPEs

The major advantages of TPEs over thermoset rubbers relate to processing, particularly the

option of processing TPEs on equipment that is used for plastic extrusion16 or injection

molding.17 By comparison, traditional rubbers require slow batch processing using capitalintensive machinery.18 TPEs also can be made in specific grades because they are produced

in continuous processes, whereas it is much more difficult to achieve consistent

specifications for the materials produced in batch processing because of slight variations in

the conditions for each batch.19
20Vulcanization is the industrial process in which raw rubber is heated with sulphur and

certain other chemicals to achieve the crosslinks that “set” thermoset rubbers. Heinisch,

Dictionary of Rubber, p. 189.

21Thermoforming is a process in which a sheet of material is heated and then pulled (by

vacuum, pressure, or a mechanism) onto a form or mold. This process is effective for low-cost

parts with large surface areas; the costs of tooling are low and there are no restrictions on part

size. Considine, ed., Chemical and Process Technology Encyclopedia, p. 884.

22Sherman, “New Applications Breed New Ways to Process TPOs,” p. 16.

23Miller, “TPO Takes Fast Lane,” p. 43.

24A polymer based on any of the olefins, which are carbon-based molecules with the basic

formula of CnH2n.

25A thermoplastic polymer of propylene.

26Sherman, “New Applications Breed New Ways to Process TPOs,” p. 16.

27In blow molding, a thin cylinder, called a parison, is extruded and then inserted in a split

mold; the parison is then pneumatically pressed into the mold to produce a thin, hollow part. 

Considine, ed., Chemical and Process Technology Encyclopedia, p. 884.

28Estimates of cost savings associated with TPE processing are not available.

29Rader, “Thermoplastic Elastomers,” p. B-58.

30Ibid. 

31Eller, “Interiors,” p. 52.

32Eller, “Interiors,” p. 49.

33An automobile part that connects the steering shaft to the steering gear and serves to isolate

the driver (via the steering wheel) from imperfections in the driving surface.

34“A New Feel for the Road,” Automotive Production, vol. 108, No. 7 (July 1996), p. 22.

111

Thermoset rubber is limited in its processing methods, in part because of low temperature

constraints required to prevent premature vulcanization.20 By comparison, a number of more

specialized processing techniques are possible with certain TPEs. For example, film and

sheet extrusion and thermoforming21 processes are being developed to use TPOs in “softskin” applications in car interiors. After extrusion, the TPO is then thermoformed to a more

rigid material, thereby improving the feel of the end product.22 Although the thermoplastic

polyvinyl chloride (PVC), which has excellent tactile characteristics, is currently the most

common material used for thermoformed products, TPO use in mid-priced cars is growing

in popularity because of its superior UV resistance, better color stability, and lower weight.23

Low-pressure injection molding is also opening TPOs to new soft-feel applications. In this

process, a composite of TPO skin and polyolefin24 foam is placed in a mold, and

polypropylene25 is then injected under low-pressure conditions. In one step, the producer

generates a finished part with no adhesive materials required.26

Blow molding,27 which is not an option for thermoset article manufacturers, also has been

pursued by TPE producers. Because of easier processing and the ability to generate

extremely thin parts, blow-molded TPEs reportedly offer significant cost savings28 over

injection-molded hollow parts made of thermoset rubbers.29 For this reason, TPEs are

becoming a popular material choice for hollow products, such as bottles, convoluted boots,

and bellows.30

Innovations in TPE processing techniques, especially molding, are likely to produce an

increase in part consolidation, meaning that one single large part takes the place of several

smaller parts.31 Parts consolidation is attractive to the auto industry because it reduces

assembly and disassembly cost and leads to improved energy efficiency.32 For example, a

new design for an intermediate steering shaft33 that incorporated TPE components reduced

the number of parts from 13 to 3; this lowered the cost of the product by about 20 percent.34
35Rader, “Thermoplastic Elastomers,” p. B-58.

36For more information on the recycling of post-industrial and post-consumer TPOs to

produce resins for use in automobiles, please see the following journal article: Lindsay Brooke,

“Like a Virgin,” Automotive Industries, vol. 177, No. 4 (April 1997), pp. 105-109.

37Mapleston, “New Grades and Processes,” p. 65.

38Ibid.

39Rader, “Thermoplastic Elastomers,” p. B-56.

40Estimates of cost savings associated with TPE processing are not available.

41Rader, “Thermoplastic Elastomers,” p. B-58.

42Reisch, “Thermoplastic Elastomers,” p. 11.

112

TPEs, like all thermoplastic materials, are recyclable. Because of the efforts by industry to

minimize processing waste, the ease of recycling TPEs provides a considerable advantage

over thermoset rubbers. In processing TPEs, scrap can be returned to the manufacturing

lines after simple drying and regrinding steps. Individual finished products can be recycled

as well, although the process is slightly more involved than for scrap.35 This is attractive to

the auto industry36 since many of the rubber components of a car are discrete parts, and it

is therefore possible to remove an individual component and use its material in the

production of another item.37 The average car, exclusive of tires, contains about 26 pounds

of rubber, offering a substantial incentive for automakers to use TPEs in place of

thermosets.38

For parts processors currently producing thermoset rubber articles, there are some

disadvantages to switching to TPE materials. First, the type of equipment used for TPE

parts is very different than that which is used for thermosets, requiring a significant

additional investment in new equipment to convert to TPE materials. Even though the

upfront cost of thermoplastic processing equipment is less than that for thermosets, the

additional investment and time required to learn a new processing technique may be

considered prohibitive by a thermoset rubber producer.39 Additionally, raw materials for

TPEs are generally more expensive than materials for thermoset rubber production, although

lower production costs40 reportedly offset this additional expense in many instances.41

The most significant disincentives to using TPEs in place of thermoset rubbers are based on

performance characteristics. High-grade thermoset rubbers offer superior blends of abrasion

resistance, flexural strength, deformation resistance, and, most notably, heat resistance when

compared with TPEs. In applications that require strong performance in these areas, the

processing advantages of TPEs are insufficient to justify their use. For example, because

TPEs are affected by heat, they are not used in place of thermoset rubbers in automobile

tires, currently the largest single application for rubbers.42

Applications in the Auto Industry

Experimentation with new materials is fairly common in the automobile industry, and the

combination of properties of TPEs has attracted automobile and auto parts producers for

original equipment (OE) as well as the replacement markets. Initially, TPEs were used

primarily for applications that had been dominated by thermoset rubbers, but the scope of
43Ibid.

44Miller, “TPO Takes Fast Lane,” p. 43.

45Jim Callari, “Playing the Resin Game,” Plastics World, vol. 53, No. 9 (September 1995), p.

115.

46John Couretas, “Material Assets: Suppliers of Metals, Plastics Battle for a Bigger Share of

Vehicle Content,” Automotive News, No. 5701 (February 24, 1997), p. 32i.

47Estimates of cost savings associated with TPE processing are not available.

48Miller, “TPO Takes Fast Lane,” pp. 42-43.

49Ibid., p.47.

50As indicated in the text box, there is a broad range of TPEs, which vary significantly in

price.

51Martin O’Neill, “High-Performance Markets Drive TPU Innovation, Growth,” Modern

Plastics, vol. 74, No. 3 (March 1997), p. 71.

113

uses for TPEs is expanding. Increasingly, applications requiring the characteristics of

thermoplastic materials such as PVC have begun switching to TPEs. TPEs can reportedly

offer considerable savings to automakers over thermosets on the basis of processing costs,43

and TPE parts can be 15 to 30 percent less expensive than comparable goods of other

thermoplastics.44 Additionally, auto producers’ concern with minimizing vehicle weight,

which has been buffered by claims that gas consumption could be lowered by 750,000

barrels per day if carmakers were to reduce automobile weight by 25 percent during this

decade,45 has led to increasing use of plastic materials in place of metals.46

Current Applications

Early, less sophisticated thermoplastics elastomers were chosen mainly for their low cost,

low-temperature impact resistance, and potential for recycling. The auto industry found use

for these materials, generally TPOs and SBCs, in applications with low-performance

requirements, such as bumper guards, air dams, wheel well liners, rubstrips, dashboard trim,

grommets, and step pads. Recent technical developments have strengthened the

performance of TPOs for use in higher stress automotive products, including bumper fascia,

cladding, and side trim. Producers reportedly are able to reduce the wall thicknesses of

these parts by using TPEs, resulting in cost savings47 and shorter processing times, with

superior performance over other plastic materials.48

The application of TPOs in the auto industry has expanded to significant interior and

underhood parts as well. The replacement of PVC skins in several key uses, including skins

for instrument panels, door trim panels, and consoles, is a boon for TPO producers. The

thermoplastic elastomers perform better in several areas, including long-term property

retention and simplified recycling, when compared with PVC; however, TPEs are not

typically used for soft skins in high-end automobiles because their tactile qualities are

considered to be inferior to those of PVC.49

Several types of TPEs are high in cost,50 which has limited their use in the auto industry.

However, there are cases in which other factors somewhat offset the importance of cost in

choosing a material. For example, glass fiber-reinforced TPUs have been introduced as a

lighter substitute for steel in vehicle body panels. In addition to offering energy efficiency

through lower vehicle weight, TPUs have excellent structural integrity, low warpage,

dimensional stability, and high paintability (with no primer required).51 High-priced COPEs

are generally used only in high-performance parts, such as the constant velocity boot,
52Mapleston, “New Grades and Processes,” p. 65.

53Ibid. 

54Ibid. 

55Information obtained from the Airbag Options website (http://www.airbag.net/) on January

8, 1998.

56Mapleston, “New Grades and Process,” pp. 66, 68.

57Robert D. Leaversuch, “TPEs Address Emergent Needs in Molded Automotive Interior

Parts,” Modern Plastics, vol. 73, No. 4 (April 1996), p. 93.

114

“where functional integration enables them to replace traditional materials.”52 COPEs also

are favored over thermosets for these types of parts because the products made from these

thermoplastic elastomers typically do not need to be replaced during the lifetime of the

vehicle.53

As the development of TPVs has flourished (detailed below), automakers have found

increasing use for these materials, such as in the corner sections of window seals. Formerly

an application for thermoset rubber, use of TPVs allows producers to avoid finishing steps,

including trimming and bonding, and expedites the overall production process from

approximately 3 minutes to a matter of seconds.54

In most of the aforementioned parts, a TPE has been used as a replacement for thermoset

rubber or another plastic material. However, TPEs are not limited to serving as

replacements for other materials in existing applications. There are some products that have

been developed with TPEs as the primary materials employed from the outset. For example,

airbag designers have used a variety of thermoplastic elastomers in their effort to create an

effective yet inexpensive product. There is still considerable design experimentation to be

done on these parts, especially in light of recently released information on potential hazards

related to their use.55 However, the TPE combination of firm yet flexible properties seems

particularly well-suited for these products. Given the expected magnitude of the market for

airbags, this reportedly bodes well for TPE producers.56

Developments and Future Applications

TPE producers have been active in developing highly specialized materials intended for

specific end uses. There also has been significant research and development of new

processing techniques to maximize performance characteristics, while minimizing the

quantity of material and time required for production of each article. Some significant

innovations in the auto industry are outlined below.

Considerable progress has been made in the area of TPVs. For example, one recent

development is a TPV grade that can be foamed in a water-based extrusion process; the

material is then used in the production of the hoodseals of a Japanese recreational vehicle.57

In another innovative extrusion process, TPVs are coextruded with another thermoplastic

(e.g., polypropylene) to produce a single component with distinct rigid and soft sections.

The dual nature of these materials makes them particularly useful for producing seals: the

rigid segments anchor the seal in place while the soft segments perform the sealing function.

 Given the wide variety of automotive seals, each with particular requirements depending

on the section of the vehicle involved, there is likely to be considerable material and process

development in this area. Industry experts have predicted that auto seal producers will
58Robert D. Leaversuch, "New Applications Extend End-Use Penetration,” Modern Plastics,

vol. 74, No. 1 (January 1997), p. 75.

59Patrick Toensmeier, “TPE Formulations Show New Versatility,” Modern Plastics, vol. 72,

No. 5 (May 1995), p. 75.

60The name of this processing technique reflects the role of robots in shaping the extruded

material.

61According to an auto industry expert, an automotive belly pan is used to cover the bottom of

an automobile, thereby smoothing airflow under the vehicle and reducing noise.

62“TPE Robotic Extrusion,” Machine Design, vol. 69, No. 2 (Jan. 30, 1997), p. 108.

63Estimates of cost savings associated with TPE processing are not available.

64“Robotic Extrusion Molds Soft Materials over Rigid Substrates,” Machine Design, vol. 69,

No. 11 (June 5, 1997), p. 96.

65Reisch, “Thermoplastic Elastomers,” p. 13.

66Rader, “Thermoplastic Elastomers,” p. B-58.

115

continue to pursue easily processed, low-priced replacements for the thermoset rubbers

currently in use.58

TPUs are often considered to be too expensive for use in most auto parts, especially

compared with lower priced TPOs and TPVs. However, there has been substantial research

on the possibility of alloying TPUs with any of several lower grade materials. The price

reduction could be significant enough to warrant such combinations, in spite of the

compromise on performance.59

A new processing technique that looks promising for the production of a variety of auto

parts employs robotic60 extrusion technology to cover hard materials with a soft TPE profile.

The innovation was first used in Europe to produce an automotive belly pan,61 and auto parts

manufacturers are anticipating a wide range of new applications, including engine

encapsulation parts, sunroof profiles, and edged protection for metal parts.62 Using this

technique, the TPE is extruded through a flexible, heated hose; robots shape the profile to

the rigid substrate, which can be made of any material that can withstand the heat and

mechanical constraints of the process. With minor modifications to the robot’s program,

part specifications can be altered to meet a wide variety of needs. By comparison with the

injection molding methods (see footnote 17) that are used in similar applications, robotic

extrusion reportedly lowers tooling costs,63 gives flexibility to adjust to production of

different parts, produces tight tolerances, and allows for a variety of hollow shapes.64

Outlook for TPE Producers

The growing popularity of TPEs is not limited to the auto industry. Several other sectors

also are expected to demonstrate high average annual growth rates for TPE use during

1995-2000 (table 2), even surpassing growth in the auto industry. Although the auto

industry is likely to continue as the leading consumer of TPEs, medical products will be a

particularly strong area of growth, followed by consumer products and construction.65 TPEs

offer the medical industry considerable benefits over thermoset rubbers on toxicological

grounds; certain unhealthful chemical additives required for the vulcanization process, such

as heavy metals (e.g., tellurium and selenium) and aromatic hydrocarbons (e.g., dibenzoyl-pquinone dioxime), are unnecessary in production of TPEs.66
67The IISRP website (http://www.iisrp.com/) on September 4, 1997.

68However, it should be noted that these developments arose prior to the recent economic

problems in Asia, and at this time there is no firm indication as to how TPE consumption will be

affected.

69The Economist Intelligence Unit, “World Rubber Trends and Outlook,” ch. in Rubber

Trends: The Worldwide Rubber Industry, 1st quarter 1997 (London: The Economist Intelligence

Unit, 1997), p. 21.

116

Table 2

Estimated world growth for thermoplastic elastomers, by industry, 1995-2000

Industry sector 1995 2000

Average

 annual growth

 ----(Million pounds)----- (Percent)

Motor vehicles ........................... 798 1,133 7.3

Footwear ................................ 503 593 3.3

Industrial machinery and equipment ........... 463 653 7.1

Consumer products ....................... 236 346 8.0

Wire and cable ........................... 130 165 4.9

Medical products ......................... 99 174 11.9

Construction ............................. 62 90 7.7

Other ................................... 44 64 7.8

 Total ................................ 2,335 3,218 6.6

Source: Marc S. Reisch, “Thermoplastic Elastomers Target Rubber and Plastics Markets,”

Chemical and Engineering News, vol. 74, No. 32 (August 5, 1996), p. 13.

Regional Consumption

North America is currently the leading regional consumer of TPEs in the world (table 3),

which is consistent with its position as the leading consumer of rubbers. According to the

International Institute of Synthetic Rubber Producers, North American consumption of TPEs

was expected to grow at a high rate during 1995-97, especially in comparison with that of

the second largest consumer, Western Europe. The tepid projected growth in consumption

for Western Europe has been attributed to the region’s sluggish economy. Latin America,

the Commonwealth of Independent States, and the Middle East and Africa all showed

gradual growth during 1995-97.67 Data on Asian TPE consumption are not available;

however, as indicated by recent business developments (see following section), growth in

Asian markets would seem likely.68 China in particular has been a significant consumer of

TPEs for use in its footwear industry.69
70“AES, an Instant Giant, Says It Will Catalyze Big Expansion of TPE Field,” Modern

Plastics, vol. 68, No. 3 (March 1991), p. 16.

71Information obtained from the DuPont Dow website (http://www.dupont-dow.com/) on

Sept. 16, 1997.

72“Business Briefs,” Modern Plastics, vol. 73, No. 3 (March 1996), p. 19.

73“TSR Invests in China, Thailand, U.S.” Chemical Week, vol. 158, No. 10 (March 13, 1996),

p. 21.

74“Kuraray May Build Texas Plant,” Chemical Week, vol. 159, No. 14 (April 9, 1997), p. 12.

117

Table 3

TPE consumption, by region, in million pounds, 1995-97

Region 1995 19961 19972

Average annual

growth, 1995-97

(percent)

North America .......................... 831.0 913.6 976.4 8.4

Western Europe ........................ 694.3 694.3 722.9 2.0

Latin America .......................... 26.7 30.9 33.1 11.3

Commonwealth of Independent States ...... 19.8 22.0 22.0 5.4

Middle East and Africa ................... 13.2 13.9 14.8 5.9

World ................................ 1,924.1 2,027.7 2,135.7 5.4

 

1

 1996 figures are based on partial year data.

 

2

 1997 figures are forecasts by IISRP.

Source: Compiled by USITC staff from data obtained from the International Institute of Synthetic

Rubber Producers’ website (http://www.iisrp.com/) on Sept. 4, 1997.

Business Developments for TPE

Business activity involving TPE has thrived recently. While the following is not an

exhaustive list of business developments in TPEs, the information cited is indicative of the

growth anticipated by the chemical industry.

In North America, expansion of TPE capacity is ongoing. An earlier indication that

thermoplastic elastomers were becoming serious competitors with rubber and plastics was

the emergence of a joint venture by two large chemical companies. In January of 1991,

Monsanto Chemical Co. and Exxon Chemical Co. joined forces to form Advanced

Elastomer Systems (AES), a company intended to draw on the parent companies’ strengths

to develop innovative thermoplastic elastomers.70 Similarly, on April 1, 1996, DuPont Dow

Elastomers was created as a joint venture between DuPont Chemical Co. and Dow Chemical

Co., with a focus on the creation of specialized elastomer materials.71

Other developments followed. Bergmann Kunststoffwerk of Germany, a part of the M.A.

Hanna Group of Ohio, has invested in a new production facility in Spain. The site will

increase the company’s TPE production by 25 percent.72 Additionally, an Asian company,

Taiwan Synthetic Rubber (TSR), purchased a 30 percent stake in a U.S. TPE producer, JVon. TSR plans to use the investment as an opportunity to expand its TPE technical

capabilities as well as its U.S. marketing experience. Conversely, J-Von expects the

arrangement to help gain entry to the Asian market, for both sales and investment.73

Another Asian company, Kuraray (Japan), has pursued the possibility of building a TPE

plant in Texas, given the significant demand for its products in the United States and

Europe. After 3 years of marketing in the American and European markets, Kuraray is

interested in building a production facility to supplement its 10,000 metric ton (about 22

million pounds) plant in Japan, ideally with a geographical advantage for the U.S. market.74

With the stated goal of capturing 20 percent of the world TPE market, DSM (Netherlands)
75“DSM Starts Up Rubber TPEs,” Chemical Week, vol. 159, No. 14 (April 9, 1997), p. 30.

76“TPE Supplier Acquired by Taiwan Companies,” Modern Plastics, vol. 73, No. 3 (March

1996), p. 23.

77“Business Briefs,” Modern Plastics, vol. 73, No. 3 (March 1996), p. 23.

78“ DuPont Dow Slates Singapore for Base,” Modern Plastics, vol. 73, No. 6 (June 1996),

p. 25.

118

recently invested in increased production capacity at its plant in Belgium; the new capacity

triples the previous level to 15,000 metric tons (about 33 million pounds) annually.75

In March 1996, it was reported that the Taiwanese TPO and TPU producer Polystar

Engineering Plastics Co. was acquired by two other Taiwanese companies: Tong Yang

Industry Co., an auto parts producer, and Integral Chemistry. Reportedly, Tong Yang sought

a local source of TPOs for its annual production of 600,000 bumpers, the majority of which

are exported to the United States, and 120,000 instrument panels. Prior to this acquisition,

Tong Yang was importing about 13.2 million pounds of TPOs annually.76 In Iwakuni,

Japan, the Toyobo Co. built a plant designed for production of 7.7 million pounds of

copolyester elastomer annually. Without the new facility, Toyobo was already producing

5.5 million pounds of TPEs per year, most of which were sold to Southeast Asian auto parts

producers.77 Additionally, Dow Elastomers established its Asian headquarters in Singapore

in 1996 to begin marketing TPE in the region. About 15 percent of the company’s sales are

to the Asia-Pacific region, and there is an expectation for this percentage to rise to 25 to 30

percent by 2001, as significant growth is anticipated in consumption of wire and cable,

automobiles, and footwear. DuPont Dow has long-term plans to set up production facilities

in the region.78

Conclusions

The prospects for TPEs in the auto industry seem promising. As cars continue to become

lighter in weight and more energy efficient, automakers and parts producers are expected

to continue to experiment with new and innovative materials. Research and development

to find more efficient, faster, and more effective processing methods is also likely to persist

as an integral facet of design for the auto industry. Moreover, as parts consolidation and

recycling of parts (and materials) become increasingly important objectives, the auto

industry will continue to experiment with alternative materials. Because of the ease of

processing, potential for recycling, and performance characteristics of thermoplastic

elastomers, the auto industry can be expected to find increasing use for these materials in

the future. Average annual growth of TPE use in the motor vehicle sector between 1995 and

2000 is estimated at 7.3 percent, projected to reach 1.1 billion pounds in 2000 (table 2). In

North America, TPOs specifically are expected to increase from 165 million pounds in 1995

to 335 million pounds in 2000 and 425 million pounds in 2005 (table 1).

In spite of the optimistic growth rates anticipated for TPE, it should be noted that TPEs

remain a fairly small portion of total elastomer (including natural and synthetic thermoset

rubber) consumption. Although use of TPEs will continue to grow from a broader scope of

applications, certain performance constraints, particularly the lack of heat resistance, will

curtail their application in specific areas. As noted earlier, the largest end use for rubber is

tires, an application for which TPEs are considered unacceptable.
119

World production of TPEs is increasing to keep up with demand, and growth is expected to

continue at a high rate. Because TPE producers and the auto industry, the largest current

user of TPEs and frequent driving force for material development, have an established

relationship, it does not seem likely the auto industry will encounter a shortage of materials

as a result of the rise in TPE use in other sectors, such as the medical industry. Many

possibilities remain for the auto industry to improve the performance, appearance, and

efficiency of its products, and there seems to be a commitment from TPE producers to play

a significant role in this process.
1The frame is the most important part in determining the ride characteristics of a bicycle and

draws primary interest when considering alternate materials. Components are all nonframe parts

of a bicycle. 

2Better quality bicycles are sold mostly through independent dealers and are a distinct market

segment from the lower quality bicycles that are typically sold by mass merchants such as toy and

department stores.

3MMCs are composed of a metal or metal alloy base (called the matrix) and a reinforcing

material (usually ceramic) dispersed within the matrix. For a more detailed description of

MMCs, see U.S. International Trade Commission, "Metal Matrix Composites May be Key to

More Efficient Automobiles," Industry, Trade, and Technology Review, May 1993, p. 1.

120

U.S. Bicycle Industry Creates Innovative

Products Using Metal Matrix Composites

David Lundy

(202)205-3439

lundy@usitc.gov

Competitive cycling has pushed bicycle manufacturers toward the

leading edge of technological innovation. Bicycle companies are

increasingly turning to advanced materials, such as metal matrix

composites (MMCs) in an effort to lighten frames while improving

strength and stiffness.

Since this article was first published in the Industry, Trade, and

Technology Review of May 1994, the bicycle industry has not

significantly expanded the usage of MMCs in their products. The

concluding section of this article updates recent developments.

The U.S. bicycle industry's attempts to improve the performance of bicycle frames and

components have led to the aggressive pursuit of alternate materials since the early 1980s.

Bicycle frame and component1 design is an engineering compromise between cost and

physical properties (including weight, strength, stiffness, energy absorption, and ease of

manufacture). These considerations depend on the material used, the configuration of the

material (i.e., dimensions such as tube diameter and wall thickness), and the configuration

of the frame and components. In the 1970s, in virtually all the better quality bicycles,2 steel

alloys were used in the frame and aluminum alloys were used in components. Since then,

many new materials have been adopted for use in bicycles, but steel and aluminum alloys

remain the standards for comparison.

Metal matrix composites (MMCs) are one of the most recent innovative materials to be

considered for use in bicycles.3 U.S. produced, MMC-containing bicycles have been

available in the U.S. and foreign markets for several years. These bicycles are priced at the

upper end of the better quality market and will likely stay expensive. However, this

commercialization is an important initial step in gaining acceptance of the material by the

bicycle industry and consumers, and building a base for further adoption. This article

examines innovation and materials use by the U.S. bicycle industry, the U.S. bicycle market

and industry structure, and the bicycle MMC infrastructure. It concludes with a discussion

of the outlook for more widespread adoption of MMCs.
4The mountain bicycle was actually invented during the mid-1970s, although serious

commercialization did not start until the 1980s. In this article, the term mountain bicycle refers to

a style of bicycle rather than bicycle use. Compared with a road bicycle, this bicycle has a sturdier

frame, wider tires, an upright riding position, and more gears.

5According to an industry source, the use of aluminum-alloy frames originated from research

at the Massachusetts Institute of Technology, where it was found that aluminum's lower degree of

stiffness compared with steel could be offset by using larger diameter frame tubes. The first

company to produce bicycles with aluminum-alloy frames was founded in the United States in

1978.

6Published figures on the composition by frame material of the U.S. better quality bicycle

market are not available. Figures used in this article represent rough estimates made by

representatives of two U.S. bicycle producers.

7Steel-alloy tubes can be produced with extremely thin walls, and a frame with these tubes

can be nearly as light as any alternative material frame. However, these tubes are also relatively

expensive to produce. Designing a bicycle involves tradeoffs between material and fabrication

(continued...)

121

Design and Material Innovation by the Bicycle Industry

Since the beginning of the 1980s, the U.S. bicycle industry has generated a large number of

innovative products, using a wide variety of materials and designs. The mountain bicycle

was one of the most notable innovations,4 creating a new sport (i.e., off-road bicycling) and

a new design configuration that is extremely popular with consumers; this type of bicycle

now accounts for roughly two-thirds of all U.S. better quality bicycle sales.

One recent design innovation is the bicycle with a suspension system. It gives a smoother

ride and better handling on difficult terrain, but adds a significant amount of material to a

bicycle. Strong, light-weight parts are essential in designing a viable suspension bicycle with

a reasonable overall weight.

This high degree of technical innovation has been accompanied by an intense focus on the

adoption of alternate materials. New materials, such as aluminum alloys (for frame

applications), metal matrix and carbon fiber composites, aluminum-lithium alloys, titanium

alloys, and beryllium alloys, have been developed for use in bicycles. During the 1984

Summer Olympics in Los Angeles, U.S. bicycle team members used aluminum-alloy frame

bicycles, which helped to validate these types of frames, and generated broad interest in

other alternative materials for frames.5 The success of Greg LeMond, the first U.S. racer to

win the Tour de France and a strong proponent of innovation, also furthered interest in

alternate materials in the United States. During 1985-86, bonding technology improved

dramatically, allowing engineers greater flexibility in joining dissimilar materials (a critical

technology for making carbon fiber composite frames).

Material Alternatives

Steel-alloy frame bicycles still dominate the sales of better quality bicycles, accounting for

about 85 to 90 percent by quantity of the U.S. market.6 Steel's strength, stiffness, and low

cost makes it an attractive material, but its relative weight is a significant performance

deterrent.7 The aluminum-alloy frame bicycle is the most popular nonsteel type. With the
7

(...continued)

costs. 

8

In contrast, most frames made of metal and MMCs do not need lugs; the frame tubes are

simply welded to each other.

122

development of oversize tubing to compensate for aluminum's lower degree of stiffness,

these bicycles have become the most popular alternative to steel-alloy frame types,

accounting for approximately 9 to 11 percent of the U.S. market.

Another popular alternative for bicycle frames and components is carbon fiber composite

material, which may be the best material to minimize weight. The material has been

developed extensively for road bicycles. Bicycles with carbon fiber composite frames

account for from 1 to 2 percent of the U.S. market. However, durability, a significant design

consideration, has limited the use of carbon fiber composites for mountain bicycle frames;

relatively large lugs (usually made of aluminum) must be used where the tubes intersect to

give the frame sufficient strength, which tends to diminish the overall weight savings.8

Recently, mountain bicycle producers have developed new manufacturing processes to avoid

the heavy-lug problem. One company has developed a carbon fiber composite lug and

another company has developed a process to make a one-piece carbon fiber composite

frame. However, these bicycles are at the high end of the carbon fiber composite bicycle

price range.

Recently, titanium has received considerable promotion in the bicycle industry for use in the

production of both frames and components. High cost has been a major deterrent to its use

in the past, but exports from Russia have greatly increased the supply of titanium on world

markets and its price has decreased considerably in the last few years. Titanium-alloy frame

bicycles account for less than 1 percent of the U.S. market.

MMCs are relatively new to the bicycle industry. First used commercially in a mountain

bicycle frame in 1991, MMC-frame bicycles currently account for less than 1 percent of the

U.S. market. Three companies supply MMCs to the bicycle industry for frame applications--

Duralcan (subsidiary of the Canadian aluminum company ALCAN), DWA Composites

(owned by British Petroleum), and Alyn Corp. (a U.S. ceramics and composites company).

The MMCs made by these companies have a matrix of aluminum and, respectively, a

reinforcing material of aluminum oxide, silicon carbide, and boron carbide particles.

Aluminum MMCs can be used as substitutes for conventional steel alloys to achieve a

significant weight reduction, and as substitutes for aluminum alloys (without using oversize

tubing) to significantly improve strength and stiffness. Other important advantages of these

MMCs, compared with aluminum alloys, include better fatigue resistance, superior energy

absorption, and improved friction performance.

Table 1 shows a relative ranking of several important properties of these materials. Bicycle

frame and component design involves tradeoffs in properties when selecting materials. For

example, one of the tradeoffs in steel alloys is low cost versus a high specific weight.
123

Table 1

Relative ranking of bicycle frame materials1

Material properties

Typical Specific Specific ProcessMaterial composition(s) Cost2 weight3 Strength stiffness4

ability5 

Steel alloys ......... 0.80-1.15% Cr 1 7 1 5 1

0.35-0.60% Mn

0.15-0.35% Si

0.15-0.25% Mo

0.27-0.34% C

Balance Fe

Aluminum alloys .... 0.25-6.1% Zn 2 2 5 7 2

0.8-2.9% Mg

0.1-2.0% Cu

0.35-0.8% Si

0.4-0.7% Fe

0.15-0.7% Mn

0.04-0.35% Cr

0.01-0.2% Ti

Balance Al

Carbon fiber

 composites ....... Carbon fibers

in resin epoxy 6 1 3 1 7

Titanium

 alloys ........... 3.0% Al 7 6 2 6 3

2.5% V

Duralcan

 MMC ........... 85% Al 3 4 5 4 4

15% Al oxide

DWA MMC ........ 80% Al 5 5 4 3 5

20% Si carbide

Alyn MMC ......... 88% Al 4 3 4 2 6

12% B carbide

 

 

1

 The lower number indicates an advantage, i.e., lower cost, lower specific weight, higher strength, higher 

specific stiffness, or better processability.

 

2

 Includes the cost of materials and fabrication.

 

3

 Weight divided by volume.

 

4

 Stiffness divided by density.

 

5

 Processability refers to ease of shaping and joining the material.

Note.--Cr is chromium, Mn is manganese, Si is silicon, Mo is molybdenum, C is carbon, Fe is iron, Al is aluminum, 

Zn is zinc, Mg is magnesium, Cu is copper, Ti is titanium, V is vanadium, and B is boron.

Source: Mountain Bike, Jan. 1994; compiled by staff of U.S. International Trade Commission.
9A range of prices applies to all types of bicycles, depending on the configuration of the

frame material and the quality of components. Thus, a steel-frame bicycle with a suspension

system and high-quality components can easily cost more than $1,500, a high-end carbon fiber

composite-frame bicycle more than $2,000, and a titanium-alloy frame bicycle more than $5,000. 

Price data from "Super Spec '94," Bicycling, Mar. 1994, pp. 105-120; Performance Bicycle Shop

sales brochure; and Stephen C. Levin, "Composites and Bicycles: Market Diversification in

Action," Proceedings of the 38th International Symposium of the Society for the Advancement of

Materials and Process Engineering, May 1993, p. 4. 

10An additional 10 million bicycles composed the total 1993 U.S. market, but these are the

lower quality, low-cost types.

11Levin, "Composite Bicycles," and the National Bicycles Dealers Association.

124

U.S. Bicycle Market and Industry Structure

Bicycles with frames of alternate materials are significantly more expensive than steel-alloy

frame bicycles. Good quality steel-alloy frame bicycles retail in the United States for $300

to $400, compared with $600 for aluminum-alloy frame bicycles, $800 for carbon fiber

composite-frame bicycles, $900 for MMC-frame bicycles, and $1,600 for titanium-alloy

frame bicycles.9

Annual sales in the United States of better quality bicycles are estimated at slightly more

than 3 million units, sold primarily through independent bicycle dealers.10 The breakdown

of sales for 1992 by retail price category is as follows:

Retail price range Units sold

Less than $400 .......... 2,000,000

$400 - $750 ............. 750,000

$750 - $1,000 ........... 300,000

$1,000 - $1,200 .......... 75,000

Greater than $1,200 ....... 50,000

 Total ................ 3,175,000

The total better quality bicycle market in the United States, including sales of bicycles,

components, and services, is approximately $2 billion.11

The lowest cost MMC-frame bicycle falls into the upper end of the $750-$1,000 price

segment. Other models currently available cost over $1,000. Therefore, at current prices, it

appears that MMC bicycles are competitive in only a relatively small segment of the better

quality market. 

The structure of the world bicycle industry is strongly influenced by the labor-intensive

nature of producing better quality bicycles. Many bicycle producers use foreign assembly

operations, especially in Taiwan and more recently in China, to take advantage of less

expensive labor. Although the U.S. bicycle industry is a world leader in bicycle innovations,

few better quality bicycles are actually produced in the United States. Imports supply most

of the better quality U.S. bicycle market, but many of these imports are U.S. designed and

engineered bicycles sold under U.S. company labels. Figures for U.S. production of better

quality bicycles are not available, but industry sources estimate such production accounts
12Export figures are official statistics of the U.S. Department of Commerce. Some industry

representatives believe that most U.S. exports classified as "other" bicycles were larger bicycles. 

Exports of such bicycles averaged 317,000 units annually during 1991-93, and Canada and

Western Europe combined accounted for about one-third of these exports in 1993.

13Sintering is a process of densifying and bonding the constituent powders by applying heat. 

14In hot isostatic pressing, interparticle bonding and densification of a material is achieved by

applying high pressure and high temperatures.

125

for only 10 to 15 percent (about 300,000 to 450,000 units) of the U.S. market for these

bicycles, and is concentrated in bicycles priced above $800.

U.S. exports of larger bicycles (those with both wheels over 25 inches in diameter, which

includes most of the popular styles of bicycles) have averaged over 200,000 units per year

during 1991-93.12 The principal markets were Western Europe and Canada, which together

accounted for about three-quarters of such exports in 1993. The relative portion by quality

of these exports is not available.

Japanese companies dominate production of components for better quality bicycles,

including components that are part of the original equipment of bicycles, and components

that are sold to replace original equipment. Japanese component producers also have foreign

assembly operations in some Southeast Asian countries to take advantage of less expensive

labor. Most better quality bicycles have Japanese components, whether made in the United

States or in foreign countries (for U.S. or foreign companies).

The Bicycle MMC Infrastructure

There are a number of companies in the United States and Canada that are involved in the

bicycle MMC infrastructure, including MMC production, frame fabrication, component

production, and assembly operations. In contrast to most of the better quality bicycles sold

in the U.S. market, MMC-frame bicycles are produced in the United States.

Duralcan has a plant in Canada that produces aluminum MMCs, using a relatively straightforward technique of mixing the reinforcement material in molten aluminum and casting

semifabricated shapes. The Duralcan material has the simplest and least expensive

production process, but its properties are not as significant an improvement over the

aluminum matrix material as the other MMCs. The DWA MMC is produced by mixing

powders of the two constituents together and sintering the material.13 The Alyn Corp.

material, called boralyn, is produced using a proprietary method of mixing the metal and

ceramic material and hot isostatically pressing the mixture into a semifabricated form.14

These MMCs are then extruded to form tubes or other shapes. 

The Duralcan material is the most extensively developed MMC and is the most widely used.

A company in California, Specialized Bicycle Components (SBC), uses this MMC in

mountain bicycle frames, which are built by another U.S. company, Technical Dynamics,

according to SBC design specifications. SBC assembles the frames into finished bicycles.

Current production of the MMC bicycle is about 20,000-25,000 units per year, of which

approximately 35 percent are exported to Western Europe (mostly Germany, United

Kingdom, and Italy). The least expensive MMC-frame bicycle produced by SBC retails for

approximately $900.
15Specialized Bicycle Components representative, telephone interview by USITC staff,

Washington, DC, Jan. 12, 1994.

16DWA Composites representative, telephone interview by USITC staff, Washington, DC,

Jan. 13, 1994.

17In this process, silicon carbide powders are molded into a preform and molten aluminum is

allowed to infiltrate into the pores of the preform, forming the MMC.

18LSI representative, telephone interview by USITC staff, Washington, DC, Apr. 20, 1994.

126

SBC has been developing its MMC bicycles for 7 years. The goal was to produce a

mountain bicycle that mirrors the performance of a racing mountain bicycle, but with a

reasonable retail price. The company considered a number of alternate materials for their

mountain bicycle frames, including aluminum-lithium alloys, specially treated aluminum,

and other MMCs before deciding to pursue the Duralcan material. Company officials

believe the Duralcan material appeared the best suited for mountain bicycle frames because

of the fatigue resistance, stiffness, and energy absorption effect of the material.15 The

company continues to produce a wide range of mountain bicycles with steel frames and also

has a model with a carbon fiber composite frame (using a lugged design). SBC is also

examining the possibility of making certain components, such as seat posts and fork braces,

out of the Duralcan MMC.

The boralyn material is currently used in two bicycle models produced by Univega in the

United States that retail for over $1,400. Sales levels are believed by industry

representatives to be small. The Alyn Corp. sells boralyn tubes to Univega, which has

another company weld the tubes into frames. Several other companies are testing boralyn

but have not developed any commercial products.

Currently the DWA material is not used commercially in any bicycle. DWA Composites is

developing its MMC in the United States, and is working with several bicycle companies

to develop frames. It expects that bicycles with its MMC will soon be available. Industry

sources expect bicycles with DWA MMC frames to retail for approximately $1,000.16

Lanxide Corp., a U.S. advanced materials company, also produces an MMC and is

developing MMC bicycle components through a joint venture company called Lanxide

Sports International (LSI). The MMC is composed of aluminum reinforced with silicon

carbide and is produced using Lanxide's proprietary liquid metal infiltration process.17 The

MMC is available in castable ingot form and can be used to manufacture parts using

conventional casting methods. The infiltration process allows for a relatively high

percentage of reinforcement material (above 30 percent) compared with the Duralcan MMC

(which is limited to 20 percent reinforcement content) and the company claims its MMC has

better properties as a result. LSI has developed prototype components in cooperation with

casting companies. Suspension parts, pedal crank arms, chain rings, and brake system parts

have been developed and some of these parts reportedly will be commercially available

within one year. LSI plans to sell components to domestic and foreign bicycle and

component companies for original and replacement equipment. LSI is also trying to develop

frame applications for its MMC.18

Several other companies are developing MMCs in the United States for bicycle applications.

One company that makes aluminum-alloy bicycle frames is developing MMC frames using

the Duralcan MMC. Dia-Compe, MC-21 Incorporated, Sun Metal Products, Odyssey Co.,

Innovative Bicycle Components, and others are developing bicycle components that use

MMCs. Dia-Compe, a U.S. producer of aluminum components, is currently trying to
127

develop markets for MMC components. It purchases parts from MC-21 Incorporated, a

company that manufactures parts using the Duralcan MMC. Dia-Compe believes the MMC

material is particularly well suited for components, such as wheel hubs on bicycles with

suspensions (these bicycles need stronger hubs to accommodate the suspension parts) and

rims, because the MMC is an excellent braking surface. Although Dia-Compe is still in the

initial stages of developing markets for such components, it has already sold a small number

of test hubs in Europe. Sun Metal Products is close to commercializing wheel rims made out

of the Duralcan MMC. Innovative Bicycle Components is using the Duralcan MMC in

developing wheel hubs and brake parts.

Odyssey Co., a U.S. manufacturer of bicycle components, is also attempting to develop

MMC parts. This company is developing a cog set (i.e., the rear chain sprockets) for

mountain bicycles made of the DWA MMC and expects to have a commercial product by

mid-1994. The company intends the product for replacement sales (i.e., not as original

equipment) to the high-priced end of the market. The company plans to distribute the cog

set in the United States and foreign markets using its existing distribution network.

Many foreign companies are also developing MMC bicycles and components using the

Duralcan MMC. One major Japanese bicycle company has developed an MMC-frame

bicycle prototype and may soon produce it commercially. Another Japanese company and

a Taiwanese company are developing an MMC bicycle frame. At least four European

bicycle companies are developing MMC applications.

Outlook

The current production of bicycles and components containing MMCs is small, but the

technical merits of the MMC material are attracting interest among bicycle and component

producers. Technical experience with MMCs in bicycle applications is only beginning, and

MMCs lag behind more established alternative materials, such as aluminum and, to a lesser

extent, carbon fiber composites. A considerable amount of development is still needed to

find the optimum applications, designs, and MMC com- position. For example, MMC frame

design parameters, such as tube diameter, wall thicknesses, and tube configuration, which

have been researched extensively for steel and aluminum alloy frames, have not been

adequately developed. Component design is just beginning to fully consider the potential

of MMCs. Additionally, other MMC compositions (some of which may simply change the

amount of reinforcement material in existing MMCs) may prove to be more practical than

the compositions currently used.

However, there are many more companies producing or evaluating the use of aluminum and

carbon fiber composites or doing both than are dealing with MMCs. Some large bicycle

companies are not even seriously considering use of MMCs. This hesitation is partly due

to the many material choices available as well as the prospect of making further

improvements in the materials already being used.

Further development of MMCs for bicycle applications appears likely. Although MMC

bicycle production is small compared with the total U.S. market of better quality bicycles,

it appears that the market is being successfully developed. Current production is a modest

5 to 10 percent of U.S. production of the better quality types of bicycles. MMC bicycles also

account for a small but significant portion of U.S. exports of bicycles. This initial

commercialization has demonstrated that U.S. and foreign markets are receptive to MMCs,
128

and more producers will likely be attracted to these markets. Component production should

also increase because MMC properties seem especially advantageous in such applications

as rims. Lately the development of new markets for MMCs has been spurred by the decline

in U.S. defense spending. Companies that developed MMCs for military use are turning

to such alternative markets as the bicycle industry to make up for lost sales.

Bicycles containing MMCs are costly, and cost forms a significant barrier to wider use.

However, production process improvements and design innovations could effectively lower

the cost of MMC usage. According to industry sources, there is a strong possibility that

MMC extrusion methods could be improved substantially, which would lower production

costs. Further, MMCs could be used in less expensive bicycles by designing frames that

combine MMC tubes in high-stress areas and tubes of cheaper materials in the less stressed

areas. MMC components could also be selectively used on less expensive bicycles in only

the areas of highest stress or wear.

If MMC bicycles and components do become more widespread, U.S. companies are well

positioned to increase their market share in U.S. and foreign markets. The innovative U.S.

industry appears to have a substantial head start over foreign companies. However, intense

competition is likely from other materials, such as carbon fiber composites and titanium.

Recent Developments

Specialized Bicycle Components continues to sell a mountain bicycle frame made of

Duralcan's MMC and has also recently developed a road racing bicycle made of the same

material. The bicycle industry remains a minor consumer of MMCs. However, MMC

consumption in the automobile industry appears poised to increase substantially. For more

information, see “Metal Matrix Composites May be Key to More Efficient Automobiles”

later in this report.
1Weight savings and fuel economy have been cited as reasons for operators of fleet vehicles

such as trailers, delivery vans (e.g., U.S. Postal Service fleet), and railroad cars to specify more

aluminum in their vehicles. 

129

Aluminum Product Development and the

Automotive Industry

Charles Yost

(202) 205-3432

yost@usitc.gov

The automotive sector offers excellent potential for increased

aluminum consumption. Automakers are expanding their use of

aluminum to increase fuel economy and reduce emissions, but

price, supply, manufacturing cost, and recyclability pose concerns.

Research and development continues, aided by experience.

Aluminum competes with steel; steelmakers have significantly

improved sheet quality, also through collaborative efforts with

automakers.

This article was first published in the Industry, Trade, and

Technology Review of May 1994. The concluding section updates

recent developments in the use of aluminum and its competition

with steel within the automotive sector.

As a single market, the automotive sector probably has the best potential for increases in

aluminum consumption during the 1990s. Although consumption of aluminum per car

currently is relatively low, automakers worldwide are expanding the use of aluminum,

driven by concerns about performance, fuel economy, emissions, and materials recyclability.

Aluminum companies are striving to capitalize on aluminum's physical and mechanical

properties. These properties favor aluminum substitution for other metals and materials in

automobile bumper systems, engines and drive trains, heat exchangers, frames, and exterior

panels. Specific initiatives include joint research, development, and marketing efforts with

automakers. As a result of these efforts, industry analysts predict consumption of aluminum

in automobiles will double between 1992 and 2000, to 2.8 billion pounds. This article

examines aluminum's increasing importance in automobile construction, auto industry

efforts to increase its use, and projections for future aluminum use in the auto industry.

Aluminum Use in the Auto Industry

Automakers lightened average car weights by about 25 percent, to about 3,000 pounds

during 1978-80, doubling fuel economy and improving performance. Currently there is

limited market-driven impetus to achieve even higher fuel economy in the United States1

because gasoline is considered relatively inexpensive and because most automakers are

meeting Federal Corporate Average Fuel Economy (CAFE) standards of 27.5 miles per

gallon (mpg). Some industry analysts think that the average automobile will have to be

lightened further, by 500 to 700 pounds (16 to 22 percent), to meet upcoming fuel
2Enhanced fuel-efficient cars (to achieve 85 to 100 mpg by 2010, for example) is one longterm goal mentioned by some automakers and the U.S. Government. Materials research and

development is proceeding under the Lightweight Materials for Transportation Program Plan,

coordinated by the U.S. Department of Energy. See U.S. Department of Energy, Lightweight

Materials for Transportation: Program Plan, Mar. 1993.

3The outer skin of the vehicle takes on structural characteristics and body panels are welded

to a stamped/welded frame.

4The aluminum spaceframe is a vehicle platform. For example, Alcoa-Audi design uses fewer

than 100 aluminum extrusions and interconnecting diecast nodes robotically welded to form the

spaceframe, versus the 300 or so welds used on a steel monocoque frame. According to a

spokesman for Alcoa, an aluminum spaceframe weighs 40 percent less than a steel monocoque

design, and has greater rigidity (leading to improved handling) and higher crash resistance.

Although the spaceframe currently costs approximately two and one-half times more than a

monocoque, industry executives believe cost-parity is achievable through redesign. The

manufacturing process is reportedly flexible in volume and design requirements.

5Alcan's body-in-white is reportedly similar to a steel monocoque, namely a stamped frame

that is welded together to form a "unibody."

6

"Everybody's Doing It: Chasing After a Chunk of the Automotive Market," Metals Week,

Nov. 1992, p. 8. For a list of automakers using aluminum engine blocks and heads, see Stephen

E. Plumb, "Aluminum Is Taking a Star Role," Ward's Auto World, Sept. 1993, pp. 30-31. 

7California has mandated zero emissions for 2 percent of cars sold in that State after 1998.

8The American Automobile Manufacturers Association reports per car aluminum use of 173.5

pounds in 1992; a study undertaken on behalf of the Aluminum Association estimated per car use

to be slightly higher, 191 pounds in 1992.

130

efficiency and emissions requirements.2 Moreover, automakers estimate that existing

vehicles have achieved near optimum light-weighing with the choices of materials and

manufacturing methods currently employed. Further gains are expected to rely on enhanced

processing of traditional materials or developing new processes and material forms to

increase cost-competitiveness, and expand use of existing lightweight materials in midsize

sedans. 

The corrosion resistance, strength, light weight, and ease of fabrication of aluminum have

steadily increased its use by automakers. Aluminum producers are poised to compete with

current steel monocoque designs3 with aluminum spaceframes4 or body-in-white.5

Spaceframes represent potentially the largest single automotive application, requiring

approximately 80 kilos (176 pounds) of aluminum; an aluminum body-in-white would

require approximately 120 kilos (264 pounds) of aluminum.6 Both designs would be

augmented by aluminum sheet for floor pans and exterior panels. As emissions standards

become increasingly tighter,7 other alternatives, such as electric cars, may be necessary.

Some industry experts indicate that lightweight aluminum spaceframes are the only viable

structure currently available for electric car production. 

Aluminum use per car ranged from 174 to 191 pounds in 1992.8 During 1980-93, aluminum

consumption grew 35 percent while its share increased from 3 to 6 percent of the total

weight of U.S.-built cars over the same period (figure 1). Automakers reduced average car

weights and used much less of conventional steels and iron. However, the total weight of
9Calculated from data of The American Automobile Manufacturers Association, AAMA

Motor Vehicle Facts & Figures '93, p. 50. 

10Calculated from data presented in The Aluminum Association, Aluminum Statistical Review

for 1992, pp. 6 and 19, and AAMA Motor Vehicle, Facts & Figures '93, p. 3. This was due

partly to greater automobile production (12-percent increase between 1982 and 1992) and partly to

greater per car use of aluminum.

131

Figure 1

Material usage per passenger car built in the United States, 1980 and 1993

Source: Compiled from data presented in AAMA Motor Vehicle Facts and Figures, 1993.

Conventional steel

53.3%

Other metals/

non metals

19.1% Iron

14.2%

6.5%

Aluminum

3.9%

Other materials

2.9%

Conventional steel

45.2%

Other metals/

non metals

19.1%

Iron

14.2%

High strength/

stainless steel,

10.4%

Aluminum

5.6%

Other materials

2.9%

1980 1993

Average weight of passenger vehicles was 3,363 

pounds in 1980; 3,150 pounds in 1993.

powder metals

High strength/

powder metals

stainless steel,

steel and iron dropped only moderately, as automakers increased the use of more specialized

steels and powder metals.9

Aluminum shipments to the automobile industry are increasingly important to the aluminum

industry, rising by 60 percent between 1980 and 1992 to 1.4 billion pounds and accounting

for nearly 10 percent of total net shipments of aluminum in 1992.10 The automotive industry

represents the fastest growing end-use segment, and aluminum producers reportedly have

targeted the automotive industry for direct sales, bypassing distributors and service centers

that accounted for about 36 percent of aluminum shipments in 1992. Currently, more than

100 auto parts are made from aluminum. These components include bumper systems,

wheels, brakes, air-conditioning compressors, heat exchangers and radiators, engine cylinder

heads, rocker arms, pistons, and engine blocks, steering and suspension systems, shock

absorbers, transmissions, and drive train parts. 

Aluminum body structures are currently used in several sports cars. GM's Chevrolet

Corvette uses an extruded and welded aluminum rear subframe. Jaguar's top sportscar is

almost entirely aluminum, including the engine, an adhesively bonded aluminum chassis,

and outer panels. Audi and Alcoa produced the Audi A8 model in 1994, featuring an
11Alcoa is reportedly working with 11 other carmakers on spaceframe development. Drew

Winter, "Aluminum is Hot, Hot, Hot," WARD'S Auto World, Sept. 1993, p. 49. Also see Alex

Broad, "Cars lighten up as partners get together," Metal Bulletin Monthly, Feb. 1994, p. 60.

12Also, Ford's Lincoln Mark VIII uses nearly 500 pounds of aluminum in its frame, body

panels, engine and other components. Use of aluminum in hoods and roofs is expanding as well,

and is currently being used on Ford's Grand Marquis/Crown Victoria and Lincoln Town Car lines,

Toyota's Supra, and GM's upcoming Aurora. Winter, WARD'S, p. 49. 

13Reportedly the Impact is a 2910-pound (including an 1100-pound battery pack) 2-seater

electric car with a 168-piece aluminum alloy spaceframe that is the lightest and stiffest aluminum

vehicle structure developed to date. It was developed to meet California's zero emissions standards

in 1998. Cliff Gromer, "New Age of the Electric Car," Popular Mechanics, Feb. 1994, p. 40.

14"Everybody's," Metals Week, p. 8.

15Tailored blanks are patchworks of different types of sheet steel ready to be stamped into

specific body parts. They may include combinations of sheet steel of different thicknessses,

strengths, or coatings. 

16Wallace D. Huskonen, "Steel Finds a Way to Lighten Up Cars," 33 Metal Producing, Oct.

1993, p. 53.

17Stephen E. Plumb, "Aluminum," Ward's Auto World, Sept. 1993, pp. 30-31.

18Recently automotive sheet steel cost about 36 cents per pound while aluminum sheet cost

$1.35 per pound. This means about $675 of steel would be used on the frame for Ford's Sable

versus about $1,350 of aluminum for the equivalent frame. Julie Edelson Halpert, "Aluminum Is

Put To the Test by Ford," New York Times, Apr. 3, 1994, section 3 (Business), p. 7.

19Many spaceframe designs use adhesive bonding with welding to mitigate fatigue cracking. 

132

aluminum space frame, floor pan, body panels, and a cast-aluminum engine.11 And Honda's

Acura NSX model has used aluminum extensively, including as a spaceframe, since the

1990 model year. Reynolds has worked with Ford to produce a prototype aluminum

spaceframe for the Contour and Synthesis concept cars; Ford reportedly is building 20 allaluminum Mercury Sables for field testing.12 With respect to electric cars, GM's Impact

uses a welded/bonded aluminum spaceframe,13 and Kaiser Aluminum has manufactured

an aluminum spaceframe for CalStart's electric vehicle.14

Auto Industry Efforts to Increase Use of Aluminum

Certain factors have limited the increased use of aluminum in automobiles. Steelmakers

have made considerable progress in reducing automobile weight through improved designs

(for example, laser-welded tailored blanks)15 that reduce the number of parts and lower

weight, tooling and fabrication costs; more-over, automakers are making more efficient

use of a new generation of lighter gauge medium-strength steels, high-strength/low alloy

steels, and bake-hardenable steels.16 These new automotive steels, which industry

spokesmen point out did not exist 5-years ago, have enabled automakers to increase steel use

for added safety and structural features, currently designed in steel, such as antilock brake

systems, door-intrusion beams, roof structures, and undercarriage reinforcements.17 Cost and

design factors may also hinder more substantial adoption of aluminum. Aluminum is more

expensive than steel, about 4 times the cost on a pound-for-pound basis;18 requires more

energy to weld; and is susceptible to fatigue cracking.19 Automakers have expressed

concern about the suitability of aluminum for exposed surfaces.

Aluminum producers have attempted to encourage the use of their product in autos by

helping to stabilize prices, improving performance and cost-reduction efforts, emphasizing
133

safety and recycling benefits (tabulation below), and through widespread involvement in

joint ventures and strategic partnerships.

Aluminum adoption factors:

Light-weight --Aluminum intensive vehicles weigh 25 to 45 percent less than steel cars,

achieving retention of vehicle size and passenger comfort, and improving

fuel economy, vehicle performance (acceleration, braking distance, reaction

time) and handling. Lightweighing of primary components allows secondary

economies through weight reduction of engine and drive train components,

brakes and suspension system. Light- weighing appears to be more readily

achievable than development of innovative engine technologies. 

Formability --Aluminum may be alloyed relatively easily, and may be formed, fabricated,

and joined by existing methods. A wide range of properties can be engineered

for automotive applications through choice of alloy, hardness and strength,

and fabrication process. Light weight, heavier gauge, and strength

characteristics stiffen the frame to improve car ride, handling, and safety.

Process costs may be lower than those of steel, and design flexibility is high.

Corrosion resistance allows use where methanol-based fuels corrode steel.

Safety --Aluminum gauge (thickness) is usually 50 percent greater than steel in

equivalent frame and absorbs crash energy more effectively. Weld-bonded

aluminum structures generally perform at an equivalent level in frontal,

rollover, and side intrusion crashes. Spaceframe's crash- worthiness is 20

percent greater than a stamped aluminum frame.

Cost/price --Aluminum's cost, by weight, is several times greater than most steels,

although the total value of frame is small relative to total value of auto.

Price premium is declining as newer steels cost more and automakers gain

experience designing with aluminum; spaceframe cost is estimated at 150

to 250 percent greater than equivalent steel frame although parity may be

achieved. Price stability may be enhanced through use of hedge and options

purchases, and risk sharing arrangements.

Recyclability --Both steel and aluminum are currently recycled (i.e., possess an

infrastructure for recycling) and are market driven. The three major

automakers established their Vehicle Recycling Partnership consortium in

November 1991, and are changing designs and materials-sourcing patterns

to enhance vehicle recycling. 
20Drew Winter, "Ship Ahoy! Automakers Sail Into Recycling," WARD'S Auto World, Sept.

1993, p. 66.

21Relatively high prices of scrap aluminum also provide an incentive for recyclers to locate,

dismantle, and sort differing aluminum components. According to industry estimates, more than

85 percent of aluminum automotive scrap is reclaimed and recycled, and more than 60 percent of

the aluminum used in automobiles is scrap based. This latter percentage is expected to rise to 90

percent by 2010. WARD'S Auto World, Winter, p. 67.

22These joint ventures and partnerships involve competitive technologies. These differ from

precompetitive research and development consortia such as the United States Automotive

Materials Partnership and the United States Council for Automotive Research, which are

participating in government-sponsored research.

134

With respect to price volatility, aluminum is traded on several international commodity

markets and shares a reputation for speculator-enhanced price volatility with other futures

commodities. Aluminum producers have made efforts to emphasize the price stability

aspects of hedging, options, and risk-sharing arrangements. Aluminum's relatively higher

cost relative to steel has limited its use to specialty automobiles or to relatively small

production runs; to selective replacement with aluminum to achieve lighter weight and

attendant fuel savings; or to avoid slipping into a higher CAFE weight class and incurring

government penalties. Increased CAFE standards (currently 27.5 mpg, expected by industry

sources to increase to 32 to 35 mpg by 2003) may encourage greater use of aluminum.

Changes in government policy with respect to recycling also affect aluminum use. European

competition currently is being affected by German legislation dealing with automobile

recycling, for example.20 Aluminum compares favorably with steel, and it is superior to

plastics. It may be more or less readily reused (unlike plastics), and aluminum recycling is

market based.21

Automotive-Aluminum Industry Joint Ventures

Joint ventures and strategic partnerships between the aluminum companies and automobile

producers are particularly important for increasing market penetration.22 As is evident from

selected joint ventures and strategic partnerships (figure 2), research and development

partnerships targeting the automotive industry are widespread, and multinational aluminum

companies are expanding into emerging capitalist and developing economies. Every major

aluminum company is working with auto companies to develop either a spaceframe, as in

the case of U.S.-aluminum producers Alcoa, Reynolds, and Kaiser, or a body-in-white, as

in the case of Alcan (Canada).
Figure 2

Selected joint ventures, strategic partnerships, and cooperative research and development in aluminum products by region and country, companies, and

enduses

Region/country Companies involved Product or industry/enduse

North America Reynolds Aluminum

--Ford Motor Co.

--Chrysler

--General Motors

Spaceframe development for Contour and Synthesis cars; all-aluminum Mercury

 Sable being field-tested in 1994.

Chrysler Prowler is test vehicle.

Reynolds supplies wheels to GM and various components to Chevrolet division.

Alcan (Canada)

--Ford Motor Co.

Joint research, begun late 1992, to develop light-alloy fenders for new Taurus line

and aluminum sheet for car body applications.

Main supplier for Ford Synthesis 2010, in concept stage.

Ks Aluminum Technologie

--Doehler-Jarvis (Germany)

Two German companies formed a joint venture during 1992 to produce aluminum

 auto parts, including transmissions, for sale to Ford Motor. 

Alcan (Canada)

--General Motors

GM and Alcan formed a strategic partnership in 1992 to research weldable and

bondable sheet for GM's electric car program; GM is reportedly working with

other aluminum producers on extrusions for space frames and structural stampings.

Altek Automotive Castings

(Alcan Aluminum, Canada

and Teksid, sub. of Fiat,

Italy)

Two companies formed joint venture in 1993 to manufacture engineered aluminum

castings for the automotive industry.

Kaiser Aluminum

--CalStart

Electric vehicle using aluminum frame and body panels.

European Union Hayes Wheels International

--Nova Hut AS Ostrava

 (Czech Republic)

Joint venture to sell fabricated aluminum wheels to BMW AG (Germany).

Hydro Aluminium Extrusion 

 Group (Norway)

--BMW (Germany)

--Pininfarina (Italy)

Multiyear agreement signed in 1993 to perform joint research on automotive 

applications for extruded aluminum structures. Supplies aluminum structures for

E1 and Z13 concept cars. 

Joint development of Ethos One and Ethos Two concept cars, built from aluminum

spaceframes and thermoplastics.

135
Figure 2--Continued

Selected joint ventures, strategic partnerships, and cooperative research and development in aluminum products by region and country, companies, and

enduses

Region/country Companies involved Product or industry/enduse

European Union--

 Continued

Alcan (Canada)

--various

Joint efforts with British Leyland since early 1980s to make a body-in-white out of

stamped aluminum by adhesive bonding and spot welding; it has since made

several prototype bodybuilds for Italy's Bertone and Ferrari, GM, and Jaguar.

Alcoa (U.S.)

--Audi (Germany)

Spaceframe development since 1984; brought $70 million facility on line in 1993;

Audi 300 model uses spaceframe, aluminum sheet components (floor pan, body

panels), cast aluminum alloy engine. Alusuisse-Lonza (Switzerland) is to supply

aluminum alloys.

Pechiney Rhenalu

Kaiser Aluminum (U.S.)

KawasakiSteel (Japan)

Furukawa Electric (Japan)

December 1993 agreement to develop aluminum body panels for French and

European car manufacturers. Multiyear agreement focuses on alloy metallurgy,

formability, surface preparation, and joining methods in established applications

(engine blocks) and promoting its use in sheet and structural applications.

Alcoa (U.S.)

VAW Aluminum AG

Formed new company (Alcoa VAW Presswerk) to produce and market aluminum

extrusions, tube,and rod for automotive and other industries.

Hoogovens (Netherlands)

Alusuisse (Switzerland)

Commercial rolling of aluminum-polypropylene-aluminum sheet (Hylite) to begin in

1994; developed for exposed sheet applications (doors, roof, and hood).

Hungary Alcoa (U.S.)

Hungalu (Hungary)

Alcoa and Hungalu formed joint venture to produce semifinished, rolled, and

extruded forms of aluminum and certain processed products in Hungary in

December 1992. Alcoa's and Hungalu's European subsidiaries have joint marketing

and sales responsibility. 

Russia Reynolds Metals (U.S.) Aluminum company joint venture with castings producer in St. Petersburg to

produce aluminum wheels.

Japan Hayes Wheels International 

Nissan Motors 

Partnership formed in 1993to to export fabricated aluminum wheels.

Reynolds Metals Co. (U.S.)

Mitsubishi (Japan)

Global joint venture formed in 1992 to develope automotive extrusions. 

136
Figure 2--Continued

Selected joint ventures, strategic partnerships, and cooperative research and development in aluminum products by region and country, companies, and

enduses

Region/country Companies involved Product or industry/enduse

Japan--Continued Reynolds Metals Co. (U.S.)

Sumitomo Light Metal

Industries Ltd. (Japan)

Partnership formalized in December 1992 to develop and market automotive sheet.

Kaiser Aluminum (U.S.)

Kawasaki Steel 

Furukawa Aluminum

Partnership formalized in October 1992 to develop and market automotive body

and sheet, extrusions (space frames), castings and forgings. 

Alcoa (U.S.)

Kobe Steel

Partnership formed to conduct joint research and development and

market automotive sheet, extrusions, castings, forgings. Supplies

aluminum for all-aluminum Acura NSX sports cars (contains 1,000 pounds of

aluminum). Showa Denko developed cast aluminum parts for suspension used on

Acura.

Kawasaki Steel-Furukawa

Aluminum

Nippon Steel-Sky Aluminum

NKK-Mitsubishi Aluminum

Nippon Steel-Showa AluminumNippon Light Metal;

Sumitomo Metal IndustriesSumitomo Light Metal Industries.

Joint aluminum research and development, production and automotive sales 

between Japanese steel companies and Japanese aluminum companies.

Source: Compiled by the staff of the U.S. International Trade Commission from various articles appearing in American Metal Market, Metal Bulletin

Monthly, Journal of Commerce, Light Metal Age, HFD, and others.

137
23These estimates show a 10-percent reduction in passenger car unit weights and a 15-percent

reduction in steel content per passenger car produced in North America in 1995 and 2000 (using

CAFE standards of 27.5 mpg and 35 mpg, respectively). They indicate a 33-percent increase in

aluminum use per unit. Delphi VI Survey of the University of Michigan Transportation Research

Institute, reprinted in "Everybody's," Metals Week, p. 12.

24Bob Regan, "US vehicle aluminum reused," American Metal Market, Sept. 24, 1992, p. 6;

Halpert, "Aluminum Is Put To the Test by Ford," New York Times, Apr. 3, 1994, section 3

(Business), p. 7 (quoting executives at GM and Ford).

25Delphi VI Survey of the University of Michigan Transportation Research Institute, reprinted

in "Everybody's," Metals Week, p. 12. 

26For a breakdown of materials used in a typical family vehicle see USITC, “Alternative

Materials in the U.S. Automotive Industry Promote Development of Joining and Bonding

Technology,” Industry Trade and Technology Review, USITC, Oct. 1997, p. 14.

138

Outlook

Automotive consumption of aluminum, particularly for mass-produced autos, represents a

potentially large and relatively untapped market compared with other segments of the

transportation industry. Most auto industry executives believe passenger cars will weigh less

and use less steel during the 1990s.23 Consumption of aluminum in U.S. passenger cars is

estimated to grow from its 1993 per unit level of approximately 174 pounds per passenger

car to about 350 pounds by the year 2000.24 Aluminum spaceframes may comprise 10

percent of body styles of cars produced in North America by 2000.25

Growth in aluminum consumption is foreseen in parts and components such as cast engine

cylinder heads and engine blocks, pistons, and wheels. Growing use of aluminum sheet

reportedly is likely within 2 to 3 years for automobile fenders, deck lids, hoods, and load

floors followed by growth later in applications for doors, quarter panels, and roofs. These

applications represent selective substitution by automakers where the aluminum pricepremium to steel may be overcome by better performance.

Anticipated added pressure on manufacturers of large luxury sedans and sport cars to meet

fuel economy regulations and emission standards suggest that such firms will likely be

among the first automakers to make changes that affect aluminum consumption. Automakers

are likely to use aluminum for alternative use vehicles, such as electric cars, because of

performance requirements related to light weight, and because of emissions requirements

mandated by State laws. Stricter CAFE standards and emissions regulations may hasten

increased aluminum consumption for mass-produced autos, which may proceed more rapidly

as the industry gains more design and fabrication experience.

Recent Developments

Materials Substitution Continues

The use of light-weight materials, such as aluminum, in automobiles has increased while

heavy cast iron and certain other metals have accounted for a smaller share of vehicle

weight.26 Aluminum use increased by approximately 11 pounds, reaching 206 pounds per
27Al Wrigley, “Steel Emerges as Auto Winner,” American Metal Market, Feb. 24, 1997, p. 8. 

Industry estimates of aluminum used per vehicle vary, ranging from 196 pounds to 257 pounds

per family vehicle in 1996. Compare Al Wrigley, “Aluminum, Steel Make Gains in Family

Vehicles,” American Metal Market, Feb. 26, 1996, p. 6 with “Recent Trends in Automobile

Recycling: An Energy and Economic Assessment,” ORNL/TM/12628, Mar. 1996, and “Steel vs.

Aluminum,” New Steel, June 1997, p. 44.

28For a list of aluminum applications in cars and trucks, see Al Wrigley, “Aluminum, Steel

Make Gains in Family Vehicles,” American Metal Market, Feb. 26, 1996, p. 6; "Automakers See

the Light,” Advanced Materials News, Mar. 1997, p. 13; and Patrick Ninneman, “Competition in

Materials: Reducing the Cost of Aluminum,” New Steel, Dec. 1997, pp. 82-83.

29Al Wrigley, “GM Aluminum Engines Coming,” American Metal Market, Oct. 27, 1997, p.

4.

30These are the Audi A8, Honda Acura NSX, Lotus Elise, Jaguar XJS, GM’s electric vehicle

(EV1), Chrysler’s Prowler and Neon Lite, and the 1998 model Porsche 911. For a description of

the Acura NSX, see “Recent Inroads--Aluminum,” Advanced Materials News, Mar. 1997, p. 13.

31The Dodge Intrepid ESX2 has an aluminum frame, and a plastic (pigmented polyethylene

terephthalate) body. The ESX2, Chrysler’s concept PNGV-supercar, differs from other Chryler

models that use steel frames in combination with plastic bodies, like the Composite Concept

Vehicles (CCV) or the Plymouth Pronto Spyder. For further details of this vehicle, see Al

Wrigley, “Chrysler Drives Away From Steel?” American Metal Market, Jan. 13, 1998, p. 2.

32Ford and Alcan Aluminium developed the prototype P2000, demonstrated in Oct. 1997. 

This car weighs about 2,000 pounds which is more than 1,300 pounds lighter than the 1998

Taurus. Aluminum and some other light-weight materials are used extensively in place of more

conventional metals resulting in an 80-percent reduction in the use of steel. The P2000 was

developed as a first step toward fulfilling program goals of PNGV. Reportedly, Ford is likely to

use aluminum in developing its PNGV-supercar. See, Al Wrigley, “Ford Demonstrates First

Supercar,” American Metal Market, Nov. 3, 1997, p. 6, and Patrick Ninneman, “Competition in

Materials: Reducing the Cost of Aluminum,” New Steel, Dec. 1997, pp. 82-85.

33Under PNGV, automakers are to develop a concept vehicle by 2000 (and a production

prototype by 2005) with up to three times the current average fuel efficiency of 26.6 miles per

gallon of gasoline with equivalent purchase price while meeting customer requirements for

quality, performance, and utility. For a list of PNGV technology areas (e.g., advanced materials,

manufacturing, energy conversion, etc.), strategies, and program goals see, U.S. Department of

Energy, Transportation Technologies, PNGV, Technology Areas, found at Internet address

http://prn.branch.com, retrieved Dec. 17, 1997.

139

vehicle, between 1996 and 1997.27 An annual auto industry survey indicates increased use

of aluminum in areas such as engines and oil pans, deck lids and body panels, suspension

and steering systems, seats, and steering components.28 For example, the 1998 model-C5

Corvette contains 700 to 800 pounds of aluminum (the previous version contained only 300

pounds) including a newly designed engine, power train, and frame; and GM will reportedly

introduce a new line of aluminum engines (the “PV6") that is to replace its current line of

cast iron V-6 engines.29

Beyond the increased use of aluminum parts, aluminum-intensive vehicles (containing an

aluminum frame or outer body panels) currently are available30 or in development, including

a new Audi model that is to be available in 2000. Along these lines, Chrysler (Dodge

Intrepid “ESX2”31) and Ford (“P2000"32) recently demonstrated prototype passenger

vehicles that were developed under the government/industry program, Partnership for a New

Generation of Vehicles (PNGV).33 However, like other aluminum-intensive cars, these are

low-volume, luxury cars and not high-volume, medium-priced vehicles. For example, GM’s

electric car (EV1) costs in excess of $30,000 and the Dodge Intrepid ESX2 is priced at a
34BH steel reportedly accounts for about 65 percent of Ford’s outer body panels, and is used

by GM for several exposed sheet applications. Interstitial-free (IF) steel is reportedly used by

Chrysler for exposed body applications. The yield strengths of these two steels are significantly

higher than conventional steels, allowing the use of thinner gauge and lighter weight material.

35Estimates of the per-vehicle weight savings achievable under USLAB run to about 26

percent, compared to the 20 to 40 percent reduction suggested by PNGV. According to the steel

industry association newsletter, the first ULSAB body-in-white test unit was completed in Sept.

1997, and vendors are producing car sections for presentation in the spring of 1998 for the 11

demonstration bodies to be built under this program. See, American Iron and Steel Institute,

News, Nov. 1997, pp. 1-2. Also, "ULSAB Parts go into Production,” New Steel, Aug. 1997, p.

11. 

36For a description of cooperative efforts, see J. Neiland Pennington, “New GM Minivans

Are All Steel,” Modern Metals, Sept. 1996, pp. 53-56.

37Al Wrigley, “Steel Emerges as Auto Winner,” American Metal Market, Feb. 24, 1997, p. 8. 

Reportedly Ford will convert the deck lids on its Taurus and Sable cars to steel from aluminum

when production of the next generation of those cars begins. Al Wrigley, “Ford Switching to

Steel in Taurus,” American Metal Market, Oct. 27, 1997.

140

premium of about $18,000 compared with its conventional version, although electric and

hybrid propulsion systems rather than aluminum accounts for most of the difference.

Improvements in aluminum alloys and processing have enhanced aluminum’s market share

in automobile production. Aluminum companies have improved alloys that are more

suitable for use in outer body panels as well as for processing in current stamping plants.

These include a bake-hardenable aluminum alloy that was developed by Alcan (Canada) and

licensed to Alcoa and Reynolds, and a work-hardening series of alloys that also can be easily

formed. Automakers have gained valuable design and production experience using

aluminum, and process improvements have reduced the defect rates of aluminum parts while

increasing productivity. Reportedly, automakers have improved new joining techniques

(adhesive-bond welding and use of self-piercing rivets, for example), racks and handling

practices for aluminum stampings, and have developed new ways to stamp aluminum. 

Aluminum-Steel Competition Remains Intense

Steel companies continue to develop steel grades that are lighter, easier to process, more

reliable, and have mechanical properties superior to existing automotive steels. Automakers

have increased their use of such special high-strength steels as bake-hardenable (BH),

interstitial-free (IF), or high-strength, low alloy steels,34 as well as the newer forming

processes that allow more efficient use of steel. Steel companies also have boosted their

levels of customer service, including technical service and just-in-time-delivery, allowing

automakers to reduce production costs. Moreover, the joint research and development

programs between the auto and steel industries, like the Auto/Steel Partnership and the

Ultra-light Steel Auto Body (ULSAB),35 focus on the more efficient use of steel in

automotive design and manufacturing cost reduction.36 As a result of these developments,

steel has won back some of the car parts it earlier had lost to competing materials, including

plastics and aluminum.37

Outlook
141

Automakers remain focused on issues of weight reduction, cost, quality, safety, and on using

the optimum combination of materials that together meet those criteria. They have gained

valuable experience in design and production using aluminum, as can be seen from the

increased number of vehicles that are available and parts that have been converted from

steel, as well as by the development of PNGV-supercars that meet projected CAFE

requirements. However, the higher price of such automobiles may limit the potential

aluminum share of the automobile market. Steelmakers also have improved steel grades

and worked with automakers in developing processing technologies to reduce manufacturing

costs and thus retain the market share of steel. Steel-aluminum competition is certain to

become more intense as the next generation of cars goes into design. 
1Advanced ceramics exhibit mechanical, electronic, chemical, optical, and high-temperature

properties that are superior to those of traditional ceramics. Advanced structural ceramics differ

from traditional ceramic goods in that they are made from extremely pure, microscopic powders

that are consolidated at high temperatures to yield a dense, durable structure for use in loadbearing or structural applications.

2

 USITC interviews with industry officials, June 1993.

143

Advanced Structural Ceramics: Technical

and Economic Challenges

Vincent DeSapio

(202) 205-3435

vdesapio@usitc.gov

One of the more promising areas for NMPM is that of advanced

structural ceramics. These are materials used in highperformance applications in which a combination of properties,

including light weight, wear resistance, high mechanical strength

at high temperatures, hardness, stiffness, corrosion resistance, and

low density are critical due to the extreme conditions under which

these components operate. The combination of diverse properties

has made advanced structural ceramics ideal for use in wearresistant parts and cutting tool inserts, in high volume markets

such as energy and other high-temperature applications, and in

aerospace and defense-related applications. Total demand for

advanced structural ceramics is presently expanding at annual

growth rates of approximately 10 percent. Much research effort

by private industry and the U.S. Government to commercialize

advanced structural ceramics has been dedicated to reducing the

cost and improving the fracture toughness of these materials in an

effort to make them more cost-competitive with competing

materials.

This article was first published in the Industry, Trade, and

Technology Review of August 1993. The concluding section

updates U.S. Government and private industry efforts to

commercialize advanced structural ceramics. Government

funding for research and development declined during 1996/97,

but the market for advanced ceramics is expected to continue to

expand at historic rates.

During the last several decades, advanced structural ceramics (ASC)1 have gained a

modest market share in structural applications, such as wear parts, cutting tools, and

bearings, that have long been dominated by metal components. Producers of ASC

anticipate the increasing use of ceramic products over the next decade in nontraditional

markets, such as heat engines, heat exchangers, and bioceramics.2 These markets are

driven by the need to find industrial materials that can tolerate high-temperature,

corrosive environments and by concerns for the weight reduction and increased energy
3

 Market forecasts are provided by Thomas Abraham, senior industry analyst and editor, High

Tech Ceramics News, Business Communications Co., Inc., Norwalk, CT.

144

efficiency of aircraft and automotive engines. Such improvements can decrease fuel costs

and meet fuel economy and emissions standards. Future success in expanding traditional

advanced ceramic markets and developing nontraditional markets depends on increasing

the quality and reliability of these products, improving the cost/benefit ratio of ceramic

components compared with metallic counterparts, and overcoming end-user reluctance to

substitute ceramic parts of metal parts. This article will examine (1) current and potential

applications for advanced structural ceramics and (2) industry attempts to overcome

obstacles to increased adoption of structural ceramic components.

The most common advanced ceramic materials and some of their industrial uses are shown

in figure 1. Table 1 includes some of the principal properties of the most common

advanced monolithic ceramics in use today. Monolithic ceramics contain one of these

materials while ceramic composites contain fibers that are added to the monolithic material

to improve toughness. Parts made of advanced ceramics typically have superior hightemperature strength, higher hardness, lower density, and lower thermal conductivity

than conventional metal parts, resulting in greater product durability and more efficient

system operation. For example, one ASC producer claims that its ceramic composite wear

part used in mineral-processing equipment will last up to 50 times longer than the metal

part it replaces.

The U.S. market for ASC products was nearly $500 million in 1992, with three principal

markets--wear parts, cutting tools, and bearings--collectively accounting for about 65

percent of domestic ASC consumption. The United States and Japan currently dominate

global ASC production with each nation accounting for nearly 25 percent of global

production.

ASC products account for only 5 percent of total market share in current applications.

But substantial growth of more than 10 percent per annum is expected in response to

greater overall demand by end-use industries for light-weight, energy-saving

components.3 Figure 2 shows a chronology of past introductions of advanced ceramic

materials and an estimate for possible future applications in ASC products. U.S. demand

for all ASC products is projected to rise to $2-3 billion by the year 2000 (figure 3).

Principal applications and application requirements of ASC materials are shown in figure

4.

By far, the largest potential markets for ASC parts are those related to automotive

engines, which, apart from rare and expensive ceramic turbochargers, currently have

virtually no advanced ceramic parts. The advantages of such ceramic parts for automotive

engines include increased fuel efficiency due to the ability of advanced ceramics to tolerate

high engine operating temperatures; reduced friction, weight, and inertia; and reduction or

elimination of cooling systems. The major obstacles to adoption of ASC parts in

automotive applications remain the much higher cost of these parts compared with

that of metal parts and the resistance of automotive manufacturers to replacing proven

metal parts with ASC parts, which are relatively untested in gasoline engine applications.
145

Figure 1

Current industrial uses of ASC

Type Description

Wear parts A wide variety of products in which long wear, high temperatures, and a high degree at

chemical corrosion are generated, articularly in the oil industry (e.g., seals, valves and

valve components), and the machine tool industry (e.g., nozzles, wear pads, extrusion

dies, high-temperature fasteners, grinding wheels, and liners). Ceramic wear parts are

also being increasingly used as mechanical seals in automobiles and appliances, due to

their longer durability.

Cutting tools As a result of their superior thermal and hardness properties, ceramics of silicon nitride

and zirconia can be used at much higher machining speeds than are tolerated by

cemented carbides, which are typically used as inserts tor metal turning and milling

operations. It is estimated that ceramic cutting tools are capable of increasing

metal-cutting processing times by 200-300 percent. In addition, ceramic tools are less

prone to interfacial adhesion with the workpiece they come in contact with than are metal

tools.

Bearings Ceramic bearings are replacing steel and carbide as rolling elements because they have

the ability to operate for a moderate length of time with little or no lubrication and offer

high speed and acceleration capability. It is estimated that ceramic or ceramic hybrid

roller bearings can increase wear life at equipment by 10-fold when compared to

traditional steel bearings. Military applications such as ceramic missile bearings may

spawn commercial products such as instrumentation bearings, hydraulic, and pneumatic

activator systems, and ceramic coatings for use in gas bearings.

Ceramic coatings Coatings have been developed to protect or lubricate ceramics and ceramic-metal

composites (cermets) operating in hostile environments that cause excessive friction and

wear at machinery. Coatings of titanium nitride, titanium carbide, and alumina are used to

extend the life of tungsten carbide cutting tools by a factor of 2 to 5. Zirconia coatings are

being tested as a thermal barrier in diesel engines to prevent the wear of metal pistons

and cylinders and have also been used in turbine engines to allow increased combustion

temperatures of several hundred degrees F. without increasing the temperature of the

metal components in the engine.

Source: U.S. Office of Technology Assessment, Advanced Materials By Design, New Structural Materials

Technologies, 1988, p. 52-53.
146

Table 1

Properties and end-uses of selected advanced ceramic materials compared to tool steel1

Flexural Hardness Fracture Maximum use Young's

Material strength (Vickers) toughness temperature modulus2 End uses

Degrees

MPa3 GPa4 MPa m^1/2 centigrade GPa

Alumina ............ 310 17 4 1,200 310 Wear parts,

cutting tools

Silicon carbide ...... 690 22.4 4 2,000 450 Wear parts,

cutting tools, 

heat exchangers

Silicon nitride ....... 925 15.9 5.5 1,400 315 Wear parts, automotive

engine applications

Zirconia ............ 1,440 12.8 8.5 800 220 Cutting tools, wear

parts,

experimental

heat

engines

Tool steel .......... 5,500 10 98 700 210 Cutting tools, wear

parts

 

1 Other metals, such as tool steel, often exhibit higher strength characteristics than advanced ceramics at normal

operating temperatures, but their strength characteristics fall considerably, compared to ceramics, at relatively high

operating temperatures.

 

2 Young’s Modulus defines the ratio between stress and strain and is an indicator of the elasticity of a material.

 

3

 Mega (1,000) pascals. A pascal is a metric measurement of force. One pound per square inch (psi) = 6,894

pascals.

 

4Giga (million) pascals.

Source: Saint-Gobain/Norton Industrial Ceramics Corp.
147
148

Figure 3

Estimated size of current and projected U.S. markets for ASC (in million dollars)

Item 1992 2000

Wear pants 150 540

Cutting tool inserts 100 300

Bearings 75 300

Bioceramics 20 60

Heat Exchangers 20 100

Automotive/heat engine 50 920

Aerospace, defense 80 450

Source: Various sources from 1993 including U.S. Department of Commerce publications and private industry

estimates.

Figure 4

Various current and potential applications of ASC and application requirements

Industry Application Application requirements

Machine tool ... Cutting tools

Bearings

Wire drawing dies

Wear and corrosion resistance,

 minimum lubrication requirements

Petrochemical . . Seals

Valves

Pump impeller

Heal exchanges

Energy-efficient heat 

regeneration

Automotive .... Turbocharger rotors

Push rod tips

Rocker arms

Cylinder liners

Light-weight, hightemperature, corrosion 

wear-resistance

Defense ...... Gun liners

Ceramic armor

Light-weight, strength, 

corrosion, and high-temperature 

resistance
4

 R. Nathan Katz, “Advanced Ceramics Overview and Outlook,” p. 37. Article appears in

Advanced Materials: Outlook and Information Requirements. Proceedings of a Bureau of Mines

conference, Nov. 7-8, 1989, Arlington, VA.

5

 “Advances in composites for Aircraft Engines,” Ceramic Industry Magazine, Apr. 1993, p.

75.

6

 Government-funded research has been driven by efforts to find high-strength, hightemperature, corrosion-resistant materials for increased energy efficiency and military

applications. U.S. Department of Commerce, Critical Technology Assessment of the U.S.

Advanced Ceramics Industry, forthcoming summer 1993.

149

In addition, U.S. automakers require multiple sources of supply, which may affect the

proprietary nature of research. Silicon nitride turbocharger rotors are currently the most

popular engine application for advanced ceramics. These rotors are much more widely used

in Japanese automobiles than in U.S. automobiles because of the use of turbochargers to

boost engine horsepower in smaller cylinder Japanese cars. Other potential automotive

ceramic components include valves, valve spring retainers, push rod tips, fuel injectors and

fuel-injector components, valve lifters, and valve seats.4

In the United States one company, Carborundum Co., already mass produces silicon

carbide water pump seals, which are sold to Volkswagen AG. In general, however, U.S.

automakers are less confident than foreign automakers that a major market for advanced

ceramics for use in automobiles will develop, and they are currently less committed to

using these products in their automobiles.

Although advanced ceramic materials are not currently used in aircraft engines, the ability

of these materials to operate at high temperatures with greater strength than metal alloys

promises increased demand. Industry experts forecast that by the year 2010, 20 to 30

percent of the weight of an aircraft engine may be made up of ceramic parts. If this

forecast proves accurate, the use of advanced ceramics could reduce the weight of an

aircraft engine by 25 percent, with subsequent reduction in fuel consumption of 5 percent.

For a typical airliner, this may reduce lifetime operating costs by nearly $18 million,

yielding a cost savings of 3.7 percent per passenger mile.5 Potential ASC aerospace

applications include the use of ceramic composites in compressor and fan blades and in

nonrotating engines parts.

Initiatives to Reduce Obstacles Facing Advanced Ceramics

There are essentially three challenges that must be met to enable ASC parts to achieve

broader market access (1) reducing technical obstacles that affect the performance and

reliability of ceramic materials in many critical applications; (2) minimizing higher costs

associated with both individual ASC parts and with required system redesigns; and (3)

improving end-user acceptance of ceramic parts.

Research and development efforts to improve the quality and lower the cost of advanced

ceramics is divided among private industry and government funding. According to the

U.S. Department of Commerce, the U.S. advanced ceramics industry spent nearly $190

million on research and development in 1992 while government-funded research and

development (principally by the Department of Energy and the Department of Defense)

totaled nearly $20 million in 1992.6 Nearly 75 percent of total funding on research and 
7

 U.S. Office of Technology Assessment, Advanced Materials: By Design, New Structural

Materials Technologies, 1988, p. 38.

150

development is composed of spending on ceramics processing, which includes ASC

fabrication and powder synthesis.

Initiatives to Reduce Technical Obstacles

Flaws as small as 10 to 20 micrometers can reduce the strength of a ceramic structure to a

few percent of its theoretical strength, resulting in failure under excessive loads.7 Critical

flaws in ASC parts that are too small to be detected by conventional analytical techniques

are often difficult to eliminate. Ceramic parts are less tolerant of flaws than metal parts

because flaws are far more likely to spread in a ceramic part.

Ceramic producers have generally dealt with the problem of the inherent brittleness of

ceramic materials by designing ASC products to be tougher and stronger, making them

more tolerant of flaws and more resistant to fracture. Some of the more commonly used

methods to improve toughness and strength summarized in figure 5-5. Other methods

used to improve product quality include improving the quality of ceramic powders and

improving the testing of finished products.

Figure 5

Methods to improve ceramic toughness and strength

Change in microstructure

Microstructure design of a single material through alteration of grain size and shape, or the production of

ceramic matrix corn sites. n composites ceramic particulates such as whiskers and fibers are introduced to

reduce fractures. Advantages offered by ceramic composites over monolithic ceramics include increased

strength and reliability, improved wear resistance, high thermal shock resistance, and excellent chemical

resistance.

Transformation toughening

Toughening zirconium oxide by the addition of stabilizing oxides has great potential for increased use in

low-temperature applications (e.g., hot-metal scissors) or where impact resistance is required. Aluminum

oxide has also been transformation-toughened for use in woven preforms, mats, and papers.

Hot-Isostatic Pressing (HIP)

Simultaneously applies high temperatures and pressures to eliminate flaws in silicon carbide, silicon nitride,

and zirconia to produce a microstructure that is more tine grained and uniform. This procedure permits

parts to achieve maximum strength and density and allows complex net shapes to be produced. AIthough

still at an early stage in commercial development, HIP is being used in a number of high-performance

ceramic prototypes such as gas turbine blades and rotors, turbocharger rotors, and various engineering

components. Due to the high costs of the process, applications are presently limited to low-volume, high

value-added products.

Source: U.S. Office of Technology Assessment, Advanced Materials By Design, New Structural Materials Technologies,

1988, p. 39-44.
8

 Laurel M. Sheppard, “Innovative Processing of Advanced Ceramics,” American Ceramic

Society Bulletin, Apr. 1993, p. 54.

151

Improving Ceramic Materials

Because the ASC parts industries rely on ceramic powders as their raw material, the

quality of powders is probably the greatest factor influencing the structure and

performance of the final product. Generally, the finer and purer the powder, the

stronger the finished product. Most commercial ceramic powders are made with an

average diameter of 1 micron although powders for use in advanced ceramics are as

small as 0.1 micron in size. Research efforts by manufacturers are devoted to making

ceramic powders that are purer, more consistent from batch to batch, and which sinter

more easily. Unfortunately, current technologies to improve the quality and reliability of

ceramic powders are also expensive, thereby limiting their use.

One technology being developed to produce high-quality ceramic powders at low cost

is the sol-gel process, which relies on the natural forces of synthetic chemistry rather

than on the mechanical skills of the powder processor to produce a more consistent

product. The process creates high-purity powders by altering powder characteristics

at the molecular level to produce precise particle sizes and to eliminate further grinding or

finishing operations. Sol-gel technology is already being used in applications where

extremely high purity is required.

Other technologies for improving ceramic powder quality and consistency include rapid

solidification, laser processing, and spray pyrolysis. These technologies are currently in

an early stage of development and will not be commercially available for a number of

years.

Nondestructive Testing

Nondestructive testing, which determines properties of a structural material without

altering the material, has long been used for flaw detection in ceramic materials and will

play a critical role in development of high-quality advanced ceramics. Testing equipment

is being developed that will be able to detect flaws in complex shaped parts, but in a

cost-effective manner.

In addition to the design of testing equipment, the design of testing standards to determine

performance and reliability is an important component in any attempt to increase the

market share of ASC parts. Many end users are hesitant to adopt ASC parts that do

not have a long record of reliability as documented by independent testing. The American

Society for Testing and Materials (ASTM) is currently taking preliminary steps to develop

methods that can predict and improve the strength and durability of these materials. One of

the most important properties for determining the service life of advanced materials is

“creep behavior,” also called porosity. A number of methods are currently being studied

that seek to predict creep behavior. Other research efforts are being made to develop

accurate and cost-effective tests to measure tensile strength and high-temperature

performance.8
9

 USITC interviews with industry officials, June 1993.

10 Sujit Das and T. Randall Curlee, “The Cost of Silicon Nitride Powder and the Economic

Viability of Advanced Ceramics,” American Ceramic Society Bulletin, July 1992, p. 1110.

11 Susan G. Winslow, “Development of a Cost Effective Silicon Nitride Powder,” American

Ceramic Society Bulletin, Apr. 1993, p. 102.

152

According to the ASC industry, these efforts to improve product quality have succeeded in

largely eliminating brittleness as a factor adversely influencing the use of advanced

ceramics in structural applications. As a result, ASC producers feel the quality and

performance of ASC parts are now beginning to compare favorably with metal parts and are

actively attempting to convince end users of this fact.9

Initiatives to Reduce Costs

Most in the industry argue that to compete effectively against metal parts, ASC parts must

cost no more than metal parts and must provide comparable quality and reliability.10In

specialized applications where the unique properties of ASC materials are desired, these

materials may successfully sell at somewhat of a premium when compared to prices of metal

parts. At present, the average ASC part still costs two to four times more than a comparable

metallic component and this cost differential remains as the single greatest obstacle to largescale use of ASC materials in such major markets as automotive and aerospace.

According to industry officials, the largest single factor contributing to high production

costs for ASC parts is lack of sales volume. Because there are, thus far, no large consumer

markets for these items, production runs tend to be small, and average unit costs are higher

than for competing metal products. Only by increasing sales volume and achieving the

economies of scale that derive from high-volume production will the widespread

implementation of newer cost-saving technologies, such as near-net-shape processing, be

justified, thereby enabling prices to fall to the level of metal parts. In addition to

attempting to encourage the development of a large consumer markets through contacts

with the automotive and aerospace industries, ASC producers have also concentrated

research and development efforts on technologies to reduce raw material and processing

costs.

Because raw materials, principally powders, account for nearly 40 percent of total

manufacturing costs, lowering these costs is important. The Ceramic Technology for

Advanced Heat Engines Project, a joint research effort undertaken by private industry

and the U.S. Department of Energy, was initiated in 1983 to attempt to reduce the cost of

high-quality silicon nitride powders from the then current cost of nearly $20 per pound

to a cost of less than $10 per pound. In addition, the project hopes to produce silicon

nitride powders that are suitable for forming into components for heat-engine

applications. Dow Chemical Co. has been selected as subcontractor to produce high-quality

silicon nitride powder.11

Since nearly 30 percent of manufacturing costs are accounted for by finishing and

machining operations required to form a part to its final shape and by nondestructive

testing of the part, reduction or elimination of expensive machining and finishing

operations is also critical. Labor costs currently account for nearly 30 percent of

production costs, with 85 percent of these occurring at the finishing stage. Near-net-shape
12 Near-net-shape processing describes any forming process that produces a final product that

requires little or no machining.

13 Sujit Das and T. Randall Curlee, “The Cost of Silicon Nitride Powder and the Economic

Viability of Advanced Ceramics,” American Ceramic Society Bulletin, July 1992, p. 1109.

14 John Mack, “Advanced Ceramics Processing: Cracking the Edge,” Materials Edge, Aug.

1991, p. 24.

15 Auxiliary power units are integral gas turbine engines that supply power to aircraft when

they are on the ground.

153

processing12is one of the operations that holds the most promise for reducing finishing

costs because firms often use an injection-molding forming process to meet manufacturing

requirements of high volume and cost effectiveness. By increasing the total yield and

volume of ceramic parts produced, near-net-shape processing reduces average unit

costs.13 In Japan, where injection-molding techniques have been used to produce ceramic

turbocharger rotors since the mid-1980s, reject rates for parts produced using injectionmolding have declined significantly, although they are still above reject rates for metal

components.14 The use of near-net-shape processing would allow many firms in the industry

to achieve economies of scale and would allow more firms to exceed break-even

production levels. However, the increased use of near-net-shape processing techniques is

only cost-effective when production runs are fairly large and the type of products produced

are fairly uniform.

Initiatives to Improve End-user Acceptance

Despite significant improvements in the product quality and reliability of ceramics, the

continued perception of most designers is that ceramic parts are not adequate for most

structural uses because of the potential for sudden failure. Furthermore, end users have

had a long and successful experience with metal parts and are reluctant to use advanced

ceramic materials because the performance data on these materials are not as well

developed. To overcome the perception that ceramics are not viable materials, advanced

ceramic companies have developed close working relationships with end users to

demonstrate the effectiveness of ASC parts in specific applications. Joint-venture

arrangements that allow manufacturers to confer with design engineers of the end-user

company are one example of such relationships. Government programs also help bring

end-user companies and their suppliers together for a specific purpose, such as the

design of a more efficient gas turbine engine.

Another strategy for gaining end-user acceptance is to focus adoption efforts on areas

where sudden failure would not cause catastrophic consequences. Advanced ceramic

valves are demonstrating their cost-effectiveness in diesel engines where high heat and

rough working environments have caused engines to need frequent overhauls to repair

metal valves, which wear more quickly. Although still too expensive for cost-conscious

automotive manufacturers, ASC producers have been able to demonstrate their strength

and toughness in diesel valve applications. As another example, an advanced ceramic

manufacturer is developing turbine blades for auxiliary power units for aircraft.15By

establishing a successful record in these applications, opportunities for adoption of

other parts for heat engines could materialize.
16 Dana Gardner, “Making Ceramics Work For You,” Design News, Mar. 26, 1990, p. 95.

17 Ibid.

18

 Advanced Materials, Annual Report of the U.S. Bureau of Mines, table 8, prepared by

William J. McDonough and Robert D. Brown, Jr., p. 29, 1991.

19Thomas Abraham, “U.S. Advanced Ceramics Market Growth Continues,” Ceramic

Industry, October 1996, pp. 44-45.

154

Implications for U.S. Competitiveness

The ability to compete in the international market for advanced ceramics reportedly has

important competitive implications for the United States. According to a U.S. Department

of Energy survey of global ceramics experts, the U.S. gross national product (GNP)

could expand by $11 billion in the year 2000 if the United States were to become the

world leading ceramics producer.16 On the other hand, GNP could decline by $26 billion

if foreign manufacturers were to dominate the market.17

The United States and Japan currently lead in the manufacture of advanced ceramics, with

each nation accounting for nearly one-quarter of total world advanced ceramics

production of $153 billion in 1991.18 Advanced ceramics use in the United States tends,

thus far, to be concentrated in specialized applications in the wear part and cutting tool

industries. Japanese strength in ASC markets has been built on experience in designing

advanced ceramic components for the automotive market, in which Japan leads the

United States. In Japan, advanced ceramics are widely used in automotive engines as

turbocharger rotors due to the heat-generating characteristics of turbochargers and the

greater popularity of turbocharged automobiles in Japan. On the other hand, the United

States is believed to lead Japan in the development of ASC parts for other industrial

applications and in the production of ceramic-matrix composites.

Although the U.S. ASC industry has overcome many of the technical problems that have

prevented grater market access for ASC products, the problems of low-volume production,

relative high cost, and end-user resistance to newer, nontraditional applications for these

products will take longer to overcome. In these areas, government support of both

research and development funding through the Advanced Materials and Processing

Program (AMPP) and projects such as the High Speed Civil Transport Program, which

win serve to build volume, may greatly hasten the commercialization of these

products.

Recent Developments

The U.S. advanced structural ceramics market is expected to continue its pace of rapid

growth of the past decade, increasing from $500 million in sales in 1995 to a projected

$800 million in 2000, or by 10 percent per annum, matching growth rates experienced

by this industry during the past decade.19The largest market for advanced structural

ceramics remains the market for wear-resistant parts. The market for ceramic cutting

tool inserts for the machine tool industry has been aided by the increased

commercialization of competitively priced tool inserts made with silicon carbide whisker-
20Ibid.

21David W. Richerson, “Ceramics for Turbine Engines,” Mechanical Engineering, September

1997, p. P. 83.

22James K. Wessel, “Breaking Tradition with Ceramic Composites,” Chemical Engineering,

Oct. 1996, p. 80.

23"New Horizons for Aerospace,” R & D Magazine, Jan. 1996, pp. 28-9.

24Laurel Sheppard, “Manufacturing Costs Continue to Challenge Ceramic Composites

Industry,” Ceramic Industry, May 1997, p. 43.

155

reinforced alumina and silicon nitride.20 Despite its early promise, the market for heat

engine ceramics has not developed as rapidly as anticipated due to both technical difficulties

and continuing resistance by manufacturers, such as automakers, to substitution of

commercially untested new materials for proven materials. However, the area of engine

ceramics is still one of active interest due to the potential of ceramics to contribute to

significant energy savings. The U.S. Department of Energy (DOE) has initiated a number

of programs attempting to encourage the development of turbine engines for

automotive, aerospace, and industrial applications. One program has reached the field

testing stage with Solar Turbines Inc. (San Diego, CA) to test an industrial turbine engine

containing a number of structural ceramic parts, including a ceramic combustor liner, rotor

blades, and nozzles. Results, thus far, have been reported as encouraging.21

Ceramic composites are beginning to find commercial applications on the strength of their

resistance to high temperature and thermal shock, chemical inertness, and exceptional

strength. Originally designed for use in gas turbine engines, composites are currently

being evaluated for use in aerospace applications, and in equipment such as radiant

burners and heat exchangers, where high temperatures and exposure to corrosive

chemicals pose a threat to more traditional materials.22 The Darkstar reconnaissance

aircraft, manufactured by Lockheed Martin, is one of the first military aircraft to be

designed and built (3,700 have been produced) almost completely with advanced

composite materials. The design of the composite portion of the aircraft, drawing on

research generated through a U.S. Department of Defense ARPA (Advanced Research

Projects Agency) contract, is nearly 25 percent lighter than an equivalent aluminum

structure.23The principal obstacle to further composite use in commercial applications

is cost, in that a composite component may cost 4 times more than a traditional component.

The U.S. Government, through ARPA is currently financing a $15 million program with

Northrop Grumman to develop low-cost fabrication methods for ceramic composite

structural components in an attempt to lower their costs for commercial application and

production.24 

Most advanced structural ceramics are currently produced using such traditional methods

of fabrication as injection molding, reaction-bonding, and hot-pressing. A number of

nontraditional advanced materials fabrication processes also are being developed which

are expected to result in more precise control of material grain size, production of

nearer-net shape ceramic shapes, and the use of purer materials substrates for ceramic

shapes. These nontraditional technologies include vapor deposition, sol-gel, and hotisostatic pressing (“HIPping”). Much private and government-related research and

development is currently underway to improve these technologies in an effort to lower

the cost and improve the properties of advanced ceramic components produced using

these methods. Vapor deposition techniques are increasingly being used in the

application of superhard coatings to cutting tools and automotive components such as
25"Thin-film Coatings Make Auto Parts Supertough,” R & D Magazine, March 1996. pp. 29-

30. 

26H.G. Prengel, W.R. Pfouts, and A.T. Santhanam, “Coating Carbide Cutting Tools,”

Manufacturing Engineering, July 1996, pp. 82-88.

27Information compiled by the U.S. Department of Energy, Division of Materials Sciences.

28The major defense-related application for advanced structural ceramics is in ceramic armor

used in helicopters and on some land-based vehicles. Plans to use these ceramics as armor on

more land-based vehicles have been either abandoned or postponed, due largely to budget

considerations. 

29Information compiled by the U.S. Department of Energy, Division of Materials Sciences.

30See “New Manufacturing Processes for Materials: Government Policies and Programs

Towards Commercialization” in part I of this report for more information.

31The Federal Research and Development Program in Materials Science and Technology,

Dec. 1995, p. 1.

156

engine blocks, piston rings, and valve stems, to improve their wear and abrasion

resistance.25 Technology for the application of hard coatings for carbide tools has

advanced from early single-layer coatings to current multilayer applications. The choice of

material layer and total coating thickness can also be tailored to fit particular cutting

applications.26 Sol-gel technology is continuing to find increasing commercial application

in the manufacture of films, coatings, powders and grains, fibers, and porous gels for

abrasives, construction products, and electro-optical markets. A commercial plant for the

manufacture of electrochromic glass, produced using sol-gel technology, will be built in

1998 by Donnelly Corp., while commercial production of limited amounts of aerogel

insulation by Nanopore Corp. is currently underway, with additional production

expected to sharply increase in 1998. HIPping is a process in which high pressures and

temperatures are applied to a component to improve the bonding among the particles.

The U.S. Navy is currently using HIPping to manufacture high-value parts such as

turbine engine blades. Presently, due to the high cost of the process, HIPping is

limited to components in which the value added in improved material properties

offsets the additional cost. 

The total level of research and development expenditures for structural ceramics-related

activities by all agencies of the U.S. Government declined from $136 million in 1996

to $119 million in 1997.27 The decline in the level of federal research and development

spending largely reflects less use of advanced ceramics in designs for military

hardware.28 The U.S. Department of Energy, the National Aeronautics and Space

Administration (NASA), and the U.S. Department of Defense are the principal

agencies responsible for government research and development spending, accounting

for 40 percent, 29 percent, and 25 percent, respectively, of total research and

development spending for advanced ceramics in 1997.29 Most government advanced

materials spending is integrated with the efforts of the National Laboratories,

universities, and private industry and uses traditional mechanisms of research contracts

and grants, consortia, and Cooperative Research and Development Agreements

(CRADAs).30 The goal of these expenditures is to promote commercialization of stateof-the-art materials for both commercial and military use and to meet specific

technological objectives, emphasizing development of high-performance commercial and

military aircraft; ultra-fuel-efficient and low-emission automobiles; and a durable

transportation infrastructure.31 One important initiative to use advanced structural ceramics

is the Partnership for a New Generation of Vehicles (PNGV), a consortium, which

includes the U.S. Government and U.S. automakers. Other U.S. Government offices and
32Bill Werst, “Charting Progress,” January 1997, document provided by the U.S. Advanced

Ceramics Association, Arlington, Virginia.

157

programs making significant contributions to advanced structural ceramic research and

development include the following:

C USDOE Office of Transportation Technology’s Propulsion System Materials Program focuses on the development of reliable, cost-effective ceramic

materials to facilitate their commercial introduction into automotive heat

engines. 

C USDOE Office of Industrial Technologies seeks to stimulate the development and use of industrial technologies that increase energy efficiency and

lower the costs of environmental protection by focusing on technologies to

improve process efficiency within the most energy-intensive industry sectors

of the U.S. economy.32 

C Current ARPA activities emphasize the development of affordable

manufacturing and fabrication techniques for ceramics, oriented toward

finding methods to manufacture low volumes at costs comparable to those of

high-volume production. 

C The Continuous Fiber Ceramic Composite (CFCC) program is a collaborative effort involving industry, national laboratories, academia, and other

government researchers seeking to develop advanced composites for use in

CFCC components.

 
1

 An advanced material is one that exhibits superior physical properties (e.g., strength,

strength-to-density ratios, hardness, durability, etc.) compared with conventional materials.

Advanced materials are also referred to as “new ,” “high-tech,” or “high-performance” materials.

159

Metal Matrix Composites May Be Key to

More Efficient Automobiles

David Lundy Robert Kaproth

(202) 205-3439 (202)205-3120

lundy@usitc.gov kaproth@usitc.gov

Automobile manufacturers are responding to demands for greater

fuel efficiency through use of alternate materials such as metal

matrix composites (MMCs). Parts made of MMCs offer significant

weight savings while maintaining if not improving performance as

compared with conventional materials. Over the last decade,

MMCs have made slow but steady progress toward mainstream

utilization in the automobile industry. Although not used

commercially in U.S. production vehicles, the three major U.S.

automobile companies are testing MMC parts. 

Since this article was first published in the Industry, Trade, and

Technology Review of May 1993, there has been substantial

progress in the commercialization of MMCs. The automobile

industry uses MMC parts in certain limited production vehicles,

and appears poised to expand usage into other vehicles. The

concluding section elaborates further on recent developments.

Environmental concerns, especially in the large automobile markets of the United States,

Japan, and the European Community, have caused strict fuel economy and emission

standards to be implemented, and more stringent standards are expected. As a result, future

automobiles will have to perform more efficiently, using less fuel and generating less

pollution. To meet these standards and to maintain competitiveness, automobile producers

are seriously considering alternate materials in the design of their products. Incorporating

advanced materials, such as metal matrix composites (MMC), into automobiles appears a

promising way to achieve significant improvements in performance.1

The development of the latest generation of advanced materials has been an important goal

of research scientists for a number of decades. Much of the development has been

associated with the defense and aerospace industries, in which performance improvement

is crucial. Many advanced materials are designed to combine desirable properties of

conventional metal, ceramic, or plastic materials into a composite substance. The

adaptation of advanced materials into commercial products has been identified as an

important method of improving competitiveness. This article describes MMCs, focusing

on the types suitable for automobile applications, the structure of the U.S. MMC industry,

and the reasons why automobile companies are interested in MMCs.
2

 Other discontinuous reinforcement shapes include whiskers and fibers, which are in general

more expensive than particulates.

3

 Powder metallurgy involves mixing metal and particulate powers, forming a shape, and

sintering (i.e., heating but not melting).

160

MMC Attributes and Applications

MMCs are composed of a metal or metal alloy base (called the matrix) and a reinforcing

(usually ceramic) material that is dispersed in the matrix. MMCs typically are stronger,

stiffer, operate at higher temperatures, have better abrasion resistance, and have other

advantages.

MMC technology was first developed in the early 1960s. Since that time over $1 billion

has been invested in research and development (R&D), mostly focused on military and

aerospace applications, for which cost considerations are secondary to improved

performance. Lower cost MMCs were developed based on this research, and further

R&D was undertaken by large primary aluminum producers and chemical companies to

develop commercial applications. The automobile industry was targeted as an industry

where suitable applications could be found and where the potential for large volumes of

consumption is high. Aluminum companies specifically targeted aluminum MMCs as a

method of expanding aluminum demand.

MMC properties and production costs are dependent on the type of reinforcement and the

manufacturing process. The reinforcing material may be discontinuous or continuous.

MMCs with continuous reinforcement have the most desirable properties. However,

continuous reinforcement material is more expensive than discontinuous materials, and

continuous-reinforced MMCs require costly processes to manufacture. Present

production costs for the continuous-reinforced MMC exceed $200 per pound whereas

costs for discontinuous- reinforced MMCs can be less than $2 per pound.

The least expensive type of MMC part is the discontinuous type reinforced with

particulates,2 which is relatively inexpensive. This type can be produced using

conventional metal casting techniques. However, particulate MMCs can also produced

using powder metallurgy processes that are more expensive but that produce MMCs

with better physical properties.3

The most promising MMCs for automobile applications are the aluminum-based types.

Reinforced with particulates of silicon carbide or alumina, aluminum MMCs have been

shown to be able to take the place of certain steel and cast iron parts in automobiles

with weight savings in excess of 50 percent. Secondary weight savings are also possible,

because the use of lighter parts allows the use of lighter support systems.

Aluminum MMCs with particluate reinforcement appear to be practically viable for

use in the automobile production process. Small amounts of aluminum MMCs are

currently being used as cylinder liners and in pistons of certain Japanese automobiles.

Aluminum MMCs can be formed with standard metal-casting techniques with minor

modifications. Aluminum MMCs are also amenable to standard machining techniques.

Moreover, the raw materials are generally commodity-type items that are readily available.

At the present stage of technological development, particulate reinforced aluminum
4

 For example, Alcoa has a program with Audi (Germany) to develop an automobile with an

aluminum frame.

161

MMCs for automobile applications can be manufactured at economical production rates

and costs.

Structure of the MMC Industry

The structure of the aluminum MMC industry in North America is presented in figure 1.

Two MMC producers are primary aluminum companies (Duralcan is owned by Alcan)

and appear to be the only firms that are making a significant effort to develop the North

American aluminum MMC market for automobile applications. These companies have

several advantages over other firms that may want to enter this market, including—

P The ability to generate sufficient internal funds to finance large-scale

 research and development efforts;

P A vested interest in generating increased markets for aluminum;

P A history of working closely with automobile companies in researching

and developing aluminum-based components;4 and

P A history of involvement in the automotive supply infrastructure. These

companies have supplied conventional aluminum parts for many years and

it is likely that supplier channels can be adapted to supply MMCs with

only minor changes.

The other component of the MMC raw material providers is companies that

manufacture the silicon carbide particulates. Numerous sources of this raw material are

available. Structurally, MMCs are sold by the producers to companies that form and

machine parts. These companies are either independent or are owned by automobile

companies.

Duralcan and Alcoa produce silicon carbide reinforced aluminum MMCs using different

production processes. Duralcan produces MMCs with a casting process; Alcoa uses a

powder metallurgy process. Duralcan’s MMC is a low-cost product that will likely be used

in the most cost-sensitive areas of automobiles (i.e., brake, driveline, and suspension

systems). Alcoa’s product is a higher cost MMC that could be most effective in

improving automobile engine performance. Connecting rods, pistons, and valve train

components are some of the parts Alcoa is targeting for MMCs.

Duralcan’s facility in Canada can produce large quantities of MMCs and was built before

end-use markets had been established. Duralcan manufactures MMCs in an ingot and

billet form. Fabricating companies use these forms to produce automobile parts, either by

casting or machining. Duralcan has sponsored collaborations with parts and machining

companies to research fabrication, tooling, and welding of MMCs to ensure development

of the necessary application technologies.
5

 Companies that cannot meet U.S. fuel economy standards are subject to Government fines.

162

Intermediate 

users

––––––––––––

Parts

 fabricators

Machining 

 companies

Raw material

providers

––––––––––––

Aluminum

 companies

Reinforcement

 producers

MMC

producers1

––––––––––––

Duralcan

Alcoa

End users

––––––––––––

Automobile

 companies

Figure 1

Structure of the North American metal matrix composite industry

 

1Other companies, such as Advanced Composite Materials Corp., Dow Chemical Corp., and Textron produce MMCs

but are targeting different end users.

Source: Interviews of industry representatives by U.S. International Trade Commission staff.

Alcoa presently produces only test quantities of MMCs; however, it would not be

difficult to adapt present facilities to commercially manufacture MMCs. In Alcoa's

production process, aluminum and silicon powders are mixed and pressed into shape

called a biscuit. This shape is heated to bind the particles and is then forged into a part.

Subsequent machining may be necessary to achieve final part dimensions, although this

"near net shape" process typically requires less machining than the Duralcan process.

U.S. Automobile Companies’ Strategic Considerations

Fuel economy is a major regulatory element in the U.S. automobile market. Because of

expectations that government-set fuel economy standards will become even more stringent

in the future, automobile weight reduction and improved engine performance have

emerged as major strategies to meet these standards. Reportedly, Toyota has targeted

a 40-percent weight reduction for its automobiles. It appears that automobile companies

that cannot reduce the weight of their products or improve the performance of their

engines will face a serious burden in meeting fuel economy standards and a possible

decline in their ability to compete.5

In an attempt to increase competitiveness, the U.S. automobile industry is actively

evaluating lighter materials. Cost is the most import consideration in selecting materials.

Therefore, conventional lightweight materials, such as aluminum and magnesium are
6

 Compared with steel, the higher unit costs of MMCs are offset to some extent by the need to

use a smaller quantity for a given part.

163

the first option to replace cast iron and steel. For applications for which conventional

lightweight materials perform poorly or cannot meet strength or stiffness requirements,

advanced materials are seriously considered. Relative low cost and ease of fabrication

make particulate-reinforced aluminum MMCs the most promising advanced material

alternative. Duralcan's MMC is currently priced at $1.85 to $2.50 per pound in ingot

form (current steel price is under $0.50 per pound).6 Table 1 lists some of the potential

applications of MMCs in automobiles.

Table 1

Potential applications of aluminum metal matric composites in automobiles

System Component Advantage over conventional material

Engine ...... Piston Higher temperature operation, wear resistance, weight reduction.

Cylinder liner Wear and seizure resistance, lower friction, and weight reduction.

Connecting rod Higher stiffness, weight reduction.

Bearings Weight reduction, reduced friction.

Brakes ...... Disk rotors Wear resistance, weight reduction.

Calipers Wear resistance, weight reduction.

Driveline ..... Drive shaft Weight reduction.

Gears Wear resistance.

Suspension . . Struts Damping effect, higher stiffness.

Source: Pradeep Rohatgi, “Cast Aluminum-Matrix Composites for Automotive Applications,” JOM, Apr.

1991, p. 10.

At present all three U.S. automobile producers are testing MMC parts, but there is no

commercial production of U.S. automobiles containing such parts. Industry sources

indicate that the first MMC part in a U.S. production vehicle will probably be a drive shaft

or a brake rotor, perhaps as early as the 1994 model year.

Japanese automobile companies have been more aggressive in adapting MMC

technology to their products. Honda sells a car in Europe with MMC cylinder liners.

Toyota is selling a car with MMC reinforced pistons. Reportedly, Japanese automobile

companies are more willing to test MMC parts on production automobiles to gain

experience with the material even if it is not economically viable. The Japanese

companies also have gained MMC experience by developing in-house MMC production

capability.

Conclusion
164

Application research and development continues for MMCs. A significant amount of effort

is devoted to improving the parts fabrication and machining production stages, because

there can be substantial degradation of physical properties by current methods. Some

of this degradation may be preventable by using near-net-fabrication processes. The U.S.

automobile companies participate in MMC research and development by testing

MMC parts, developing compatible parts (e.g., brake pads that work with MMC rotors), and

developing design specifications for MMC materials.

Although MMCs offer automobile producers a material that will significantly improve

performance, the cost of MMCs and the difficulties in fabrication make it likely that

MMC parts will not be used in significant quantities by the automobile producers for

the rest of the decade. However, this period will likely be an important stage for the

automobile producers in acquiring experience with MMCs in preparation for more

intensive use. The ability to make competitive automobiles in the next century may

hinge in part on success in this stage.

Recent Developments

Aluminum MMCs are making steady progress toward mainstream commercialization.

The most promising market continues to be the automotive industry, where aluminum

MMCs offer substantial weight savings and performance improvement in most aspects as

compared with conventional materials. The efforts of two leading aluminum MMC

makers, Duralcan, a subsidiary of Alcan (Canada), and Lanxide Corp. are described

below.

Duralcan uses the stir-casting process to produce MMCs. Ceramic particles, either

silicon carbide or aluminum oxide, are mixed with molten aluminum. The mixture is

cooled to form ingots, which can be fabricated into parts using conventional casting or

metal-forming processes.

Duralcan has met considerable success in marketing its aluminum MMCs to the

automotive industry. In 1996, both General Motors (GM) and Chrysler Corp.

announced that they would use Duralcan in new limited-production vehicles. GM has

integrated rear brake drums made of Duralcan's MMCs into its experimental electric

vehicle, the EV1. Chrysler features Duralcan rear brake rotors in its unconventional

hot-rod, the Plymouth Prowler. Also unveiled in 1996, Mazda's RX-01 concept car uses

Duralcan brake rotors. Duralcan has moved into larger production runs with the standard

driveshaft of the 1997 Chevrolet Corvette, which also are optional in the 1997

Chevrolet S-10 pickup truck.

In addition, Duralcan has pursued other applications. The German ICE high-speed

train is testing Duralcan brake discs for an estimated weight savings of 13 tons on a

entire train. Duralcan expects the ICE to make widespread use of its material by the

middle or end of 1998. Metal Composite Technology of Towcester, UK, makes brake

discs for 125cc and 250cc motorbikes from Duralcan. Duralcan also is being used for the

studs of snow tires in Scandinavia.

Duralcan MMCs are supplied by a plant in Dubuc, Quebec. The Dubuc plant has an

annual capacity of 25 million lbs/yr, but this could be expanded to 30-32 million lbs/yr.
165

The plant is currently operating at about 15 percent of capacity. Duralcan also

maintains a marketing division in Novi, Michigan.

Eck Industries (Manitowoc, Wisconsin) molds the brake rotors of the Prowler. The

Kelsey-Hayes unit (Livonia, Michigan) of Varity Corp. assembles the rotors into the brake

systems. Unidrive Pty Ltd. of Clayton, Australia makes the driveshafts for the Corvette.

American Axle & Manufacturing Inc. of Three Rivers, Michigan produces driveshafts

for the S-10.

Lanxide has developed two methods of manufacturing aluminum MMCs: the Primex cast

process and the Primex infiltration process. The cast process is similar to Duralcan's

stir-casting process. In the infiltration process, molten aluminum infiltrates a porous

preform part made of silicon carbide and solidifies to form an MMC. This process

allows for a higher ceramic content than the cast processes.

In 1996, the Lotus Elise became the first production car to draw on Lanxide's

technology. Lanxide aluminum MMCs with 30 percent ceramic content are used in the

brake rotors of all four wheels. Lotus incorporated MMCs into the light-weight vehicle at

the design stage, enabling MMC brake components to be used. Elsewhere, Lanxide has

entered into a licensing agreement with Brembo of Italy for the manufacture of MMC

brake rotors and drums in Europe. Lanxide has signed a license with Akebono in Japan

for automobile applications and is in intensive discussions with potential partners in

the United States.

Lanxide has high hopes for the electronic components market, as well, expecting its

sales in electronic components to double in 1997. GM uses Lanxide MMCs in the

electronics of both the EV1 and S-10. Motorola communications satellites also

incorporate components made out of Lanxide MMCs.

Lanxide maintains a pilot scale production facility in Newark, DE. The company has

actively pursued strategic alliances. Lanxide KK is a Tokyo-based joint venture between

Lanxide (65 percent) and Kanematsu (35 percent) to promote Lanxide products in Japan.

Lanxide KK and Nihon Cement Company are 50-50 partners in a joint venture to

manufacture aluminum and ceramic matrix composites in Sendai, Japan.