Superalloy’s (SAI) recycled aluminium wheels gain traction among luxury auto brands, fuelling H1 revenue growth

The world's leading auto wheel rim manufacturer, Superalloy (SAI), has reported robust operational results for the second quarter and first half of 2024.

The Taiwan-headquartered company experienced significant order growth during the year's first half, driven primarily by increased demand from luxury European and Japanese automotive brands, including Toyota, Jaguar Land Rover, Porsche, BMW, and Ferrari. This surge in orders effectively counterbalanced a decline in shipments to American brands.

As the tier-one supplier of world-leading automakers, SAI have experience in product design for leading European, US, and Japanese automakers, with customers located worldwide.

Revenue for the period was notably diversified, with 61 per cent coming from European brands, 20 per cent from Japanese brands, 12 per cent from American brands, and the remaining 7 per cent from other customers. Notably, revenue from Japanese brands surged by 83 per cent, while European brands saw a 12.9 per cent increase compared to the same period in 2023.

Secondary aluminium wheels are gaining momentum in the luxury market

The share of secondary aluminium wheel rims in SAI's total production has grown from 26 per cent in the first half of 2023 to 32 per cent in 2024, reflecting the increasing focus on ESG (Environmental, Social, and Governance) practices by automotive brands. This shift has also supported SAI's promotion of recycled aluminium materials. SAI's secondary aluminium recently received certification from Rolls-Royce and has been adopted by seven other brand clients.

As luxury car manufacturers continue introducing new energy vehicles, they are also pushing for reductions in their carbon emissions. Beyond requiring new projects to include green or secondary aluminium quotes, SAI plans to integrate secondary aluminium into existing products for approved clients. By the end of 2024, the adoption rate of secondary aluminium is expected to rise to 40 per cent, contributing to sustained profitability growth.

Despite a slowdown in global sales of regular passenger vehicles, the luxury car market continues to outpace this trend. According to the latest USD Analytics report on the electric luxury car market, the sector is projected to grow at a compound annual growth rate (CAGR) of 12.9 per cent from 2024 to 2032.

Additionally, brands like BMW, Mercedes-Benz, and Audi have withdrawn from the price wars in the Chinese market, which is anticipated to stabilise and strengthen the overall luxury car market.

With the shift towards hybrid, electric, and new-energy vehicles within the luxury car segment, the overall automotive industry is gradually evolving. This trend is expected to boost sales of SAI's customised wheel rims.

Looking ahead to the year's second half, SAI remains cautiously optimistic. It expects shipment volumes to surpass those of the first half. The company aims to maintain year-over-year revenue growth for the entire year.

SAI will also continue to explore, innovate, and develop new applications for forged aluminium, fully committing to a responsible aluminium value chain to maximise aluminium's value contribution and further align with ESG sustainable development goals.

In July 2024, SAI reported consolidated revenue of NT$547 million (approximately US$16.86 million), a 3.84 per cent decrease from NT$569 million in July 2023. For the second quarter of 2024, consolidated revenue stood at NT$1.873 billion, down 2.64 per cent year-over-year, while operating profit reached NT$258 million, up 88.88 per cent year-over-year. However, due to the depreciation of the Japanese yen, the net profit attributable to the parent company in the second quarter was NT$164 million, down 3.67 per cent year-over-year.

For the first half of 2024, SAI's cumulative consolidated revenue was NT$3.828 billion, up 3.05 per cent year-over-year. Operating profit increased by 68.39 per cent to NT$530 million, and net profit attributable to the parent company rose by 37.02 per cent to NT$413 million. The gross margin for the first half of 2024 was 27 per cent, the operating profit margin was 14 per cent, and the net profit margin was 11 per cent, all showing improvement compared to 2023.

This marks the highest profitability for the year's first half in the past five years. Cumulative consolidated revenue from January to July 2024 reached NT$4.375 billion, up 2.13 per cent from NT$4.284 billion in 2023.

USD 1 = NT$32.44