Novelis Inc, a United States-based company specializing in industrial aluminum, is confident in the potential of China's automotive market despite its sales dip last year, expecting rising demand from the country's growing number of new energy vehicles and tougher rules on gasoline car emissions.

Steve Fisher, president and CEO of the Atlanta-headquartered company, said the adoption of aluminum products in vehicles will grow faster in the coming years in China than in the US and Europe, which are currently its top markets.

Novelis's plant, in Changzhou, Jiangsu province, started to localize its products in 2014. With an annual capacity of 100,000 metric tons, it has been serving carmakers ranging from FAW-Volkswagen and Chery Jaguar Land Rover to SAIC Motor and startup Nio. The momentum of China's new energy vehicle market is becoming another driver of Novelis' business in the country. Last year, more than 1.2 million new energy cars were sold, accounting for about half of the world's total. The China Passenger Car Association expects the figure to rise to 1.7 million this year.

James Liu, managing director of Novelis China, said China's dual credit policy, which requires carmakers to produce a certain quota of new energy vehicles and also to meet the 2020 fuel consumption standard of five liters per 100 kilometers, will spur faster and wider adoption of aluminum products.

Based on that judgment, the carmaker started a project late last year to expand its Changzhou plant with an investment of $180 million.

The annual capacity of the plant will be doubled to 200,000 tons when the project is completed in 2020.

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