Stable prices are prerequisites for sustainable magnesium industry development
----Interview with Xiongguang Hu
Chairman
Zhejiang Luffy Magnesium Co., Ltd.
Zhejiang Luffy Magnesium Co., Ltd. is a specialized manufacturer of magnesium alloy products, integrating die-casting, machining, and anti-corrosion coating operations. The company is equipped with 10 die-casting machines, 50 CNC lathes, and a dedicated coating production line, with industry-leading experience and processing technology. Integrating product design, R&D, and manufacturing, the company is committed to delivering cost-effective solutions to its clients. Its business footprint spans across Wuyi and Jinhua in Zhejiang, as well as Shenzhen, Guangzhou, Shanghai, Fujian, and Jiangsu. The company continuously introduces advanced technologies and equipment, laying a solid foundation for the production of high-quality products. At the same time, it actively recruits and cultivates talents, forming a management and technical team with strong innovation capabilities, thereby providing robust technical support for the development of superior products.
Asian Metal: Mr. Hu, thank you for joining us for this exclusive interview. To begin, could you please give us an overview of Zhejiang Luffy Magnesium Technology Co., Ltd., including its organizational structure and core business focus?
Xiongguang Hu: Thank you for the invitation. Zhejiang Luffy Magnesium Technology Co., Ltd. is a high-tech enterprise specializing in the deep processing of magnesium alloys. Headquartered in the world’s largest magnesium alloy industrial cluster, the company has established a die-casting manufacturing base equipped with a series of die-casting machines ranging from 350T to 1650T, dedicated to integrated structural component forming. Our key products include magnesium alloy motor hubs, magnesium alloy frames, die-cast frames, magnesium alloy wheels, magnesium alloy castings, integrated magnesium bicycle wheels, electric bicycle hubs, scooter frames, children's bike frames, and balance bike frames. We are a major supplier of integrated wheels for shared bicycles. To better serve the market and improve supply chain efficiency, we have established two dedicated divisions—the Automotive Division and the Two-Wheel Mobility Division. We have also built a "Yangtze River Delta 3-hour supply chain circle," leveraging tools like ERP to ensure timely delivery to OEMs. We focuses on lightweight core components and offers end-to-end services across the entire chain, from material selection to processing to finished products. First, we provide customized alloy development based on usage scenarios, offering grades such as Mg-Al-Zn (AM series), Mg-RE (high-temperature resistant), and Mg-Li (ultra-lightweight). Second, in high-pressure die-casting, we produce automotive parts like display mounts, steering wheels, and cylinder blocks, achieving 25%-40% weight reduction. For two-wheelers, parts like motor hubs, mid-drive motor housings, and folding frames see over 33% weight reduction compared to aluminum alloys. Our process advantages include high-vacuum die-casting (porosity ≤1%) and semi-solid rheocasting (surface finish Ra0.8). Third, we offer precision machining and surface treatment services, including five-axis machining of complex surfaces such as motor and engine housings. Our surface treatments include micro-arc oxidation (hardness ≥800HV, corrosion resistance comparable to aluminum) and eco-friendly chromate-free passivation certified under RoHS. Lastly, we provide collaborative R&D and simulation services, including CAE optimization for die-casting flow and structural lightweighting. We actively participate in clients’ early-stage design to jointly develop magnesium alloy substitution solutions, such as full magnesium alloy designs for electric vehicles.
Asian Metal: In recent years, magnesium prices have remained low, while the price gap between magnesium and aluminum continues to widen. How has this trend affected the demand from your downstream customers? What opportunities has it created for expanding magnesium application?
Xiongguang Hu: I would sum up the impact of this trend with three key points: cost advantage, demand explosion, and technology-driven innovation. First, in terms of cost, magnesium is currently at a historical low, while aluminum prices have risen due to energy costs, creating a highly attractive price gap. For our downstream customers—particularly in electric two-wheelers, automotive lightweighting, and 3C electronics—this represents a golden window to adopt magnesium alloys for better lightweighting at lower costs. For example, one of our new energy vehicle customers reported a 12% reduction in unit cost and a 30% improvement in weight savings after switching to magnesium—this is tangible industrial upgrading. Second, the demand surge. In the past, magnesium adoption was limited by price volatility, but the current gap is encouraging more sectors to try magnesium substitution. We are seeing three major growth areas: First, the two-wheeler sector, which is a massive market. Under the national standard limiting electric bicycle weight to 55kg, magnesium alloys have become an ideal solution. The industry consensus now is, "Every kilogram reduced adds 100 yuan of value." OEMs are even calculating screw weights! Our partners like Yadea have adopted magnesium alloy wheels to reduce 3kg and frames to cut another 5kg. Not only is the material cheaper than aluminum, but the weight reduction also increases vehicle range. Scene-specific applications are also expanding. For example, Meituan's latest shared e-bike models use our magnesium wheels, leading to a 1.8-times increase in average daily ride frequency, as maintenance staff can handle bikes more easily. In high-end motorcycles, the magnesium engine cover on the CF450CL-C has become a viral modification part online. As I often say, "It’s not that the market doesn’t need magnesium—it’s that you haven’t found the right scenario to make it shine." The trillion-yuan two-wheeler market is a golden track for magnesium to evolve from an industrial to a consumer material. Third, technological innovation. Low magnesium prices are pushing us and our clients to co-develop new solutions. For example, corrosion resistance used to be a weak point for magnesium alloys, but our "micro-arc oxidation + nano-coating" solution has increased product lifespan threefold with only a 5% increase in cost. Customers have moved from hesitation to enthusiasm. Looking ahead, we see this price gap as a historic opportunity for the magnesium industry. Luffy has joined forces with over 100 upstream partners to establish the "Magnesium Alloy Innovation Association" and plans to pursue three major initiatives over the next three years: invest 1 billion yuan into R&D for breakthroughs in magnesium welding and recycling; co-develop five national magnesium alloy standards with OEMs and universities; and build the world’s largest integrated magnesium die-casting base in Anhui.
Asian Metal: What is the current penetration of magnesium alloy in components such as battery enclosures and seat frames in new energy vehicles? How do the weight savings and cost compare with aluminum?
Xiongguang Hu: This is a great question. The battery enclosure market largely depends on battery manufacturers like CATL, BYD, and Sunwoda. In 2023, battery box revenue reached RMB 3 billion for CATL, 2.5 billion for BYD, and 1 billion for Sunwoda, indicating a vast market. Current magnesium alloy usage in NEVs ranges from 3 to 5kg, and we expect it to reach 10kg this year. Battery enclosures are still primarily made of aluminum and composite materials, leaving ample room for magnesium penetration. Compared to aluminum, magnesium alloys deliver 25%-35% weight savings for the same volume. Although the material cost per kilogram is lower, the processing cost is higher, so the total cost is roughly comparable.
Asian Metal: Has semi-solid magnesium alloy passed crash safety and NVH testing in NEVs? How is the acceptance among OEMs, and in what products has Luffy made breakthroughs?
Xiongguang Hu: Semi-solid magnesium alloys have made significant progress in both crash safety and NVH validation. In crash testing, AZ91D, for instance, has passed the 2024 CNCAP 40% frontal offset crash test, with a specific energy absorption (SEA) of 35 kJ/kg—superior to conventional die-cast magnesium alloys (25–30 kJ/kg) and approaching aluminum alloy performance. This was achieved through grain refinement and in-situ strengthening with phases like Al?Ca, which raised dynamic bending strength to 220 MPa—meeting crash beam standards such as those on NIO ET5 test models. In NVH testing, semi-solid magnesium parts show strong damping advantages, with internal porosity ≤0.5% and damping coefficients (tanδ) of 0.01–0.015, far exceeding aluminum (0.002–0.005). For example, in motor mounting brackets, noise was reduced by 3–5 dB. BMW iX1 trial parts showed that the semi-solid magnesium dashboard crossbeam reduced weight by 40% and rattling noise by 70% compared to steel parts. In terms of OEM adoption, leading companies like Tesla and BYD are testing magnesium in non-load-bearing structures such as battery beams and seat frames, although critical load-bearing parts (e.g., B-pillars) are still under bench testing. Small batch production is already underway for electric two-wheeler wheels and automotive display mounts.
Asian Metal: Magnesium alloy is known for its flammability and poor corrosion resistance. What solutions has Luffy developed for surface treatment, such as micro-arc oxidation or coating technologies?
Xiongguang Hu: On flammability, magnesium is prone to combustion during machining or melting due to its reactivity with air or water. To address this, we’ve implemented two key measures. First, safety protections: using inert gas mixtures like SF/CO during melting and casting to isolate oxygen and prevent ignition, as well as employing full-synthetic cutting fluids with magnesium inhibitors during machining to suppress fires and reduce hydrogen release. Fire-retardant zones with dry sand are also placed around machines for emergencies. Second, alloy development: incorporating elements such as Ca, Be, and rare earths (Y, Gd) increases ignition temperature and lowers oxidation activity. As for corrosion, magnesium's natural oxide film is porous (Pilling-Bedworth ratio <1), making it ineffective against corrosion. Our main solution is micro-arc oxidation (MAO), which applies high voltage in electrolytes to create a ceramic oxide layer (Al?O?/MgO) on the surface. These layers offer hardness levels of 800–1500 HV and excellent wear resistance. Our MAO-treated parts achieve salt spray resistance of 200–500 hours—far beyond untreated magnesium (24h). Our proprietary MAO process uses plasma uniformization control to avoid localized discharges, forming ultra-dense nanostructured layers. These offer extreme corrosion resistance, insulation, wear resistance, heat resistance, mechanical shock resistance, fatigue resistance, thermal regulation, biocompatibility, and aesthetic finish—all within a single coating. The surface features uniformly distributed micro-blind holes, which serve as ideal bases for secondary coatings, and metallurgical bonding ensures no penetration through the ceramic layer.
Asian Metal: What is Luffy’s current market share domestically and internationally in magnesium processing? Under the "dual carbon" goal, how do you plan to increase international market presence?
Xiongguang Hu: Currently, Luffy holds a 30% market share in magnesium alloy wheels for shared electric vehicles in China. We are also actively expanding overseas, aiming to become the industry standard-setter and innovation leader for magnesium alloy wheels in the global shared mobility sector.
Asian Metal: Given the intensifying global competition in the magnesium industry, what do you consider to be Luffy’s core competitive advantage? How do you view the outlook for China's magnesium sector?
Xiongguang Hu: Our core strength lies in stable quality and continuous improvement. The long-term development of the magnesium industry requires strategic planning and confidence. More than anything, downstream customers need to be assured that switching from aluminum to magnesium can be consistently profitable. By deepening cooperation with customers and broadening application fields, we can promote sustainable and healthy growth across the entire industry.
Asian Metal: How do you assess the current magnesium price trend? What price range do you think is most favorable for expanding magnesium applications?
Xiongguang Hu: Price stability is essential for the sustainable development of the industry. Recently, magnesium ingot prices have hovered in the range of RMB 16,200–16,500/t EXW D/P, while magnesium alloy prices have remained within RMB18,000-18,300/t. Compared to aluminum, magnesium's price advantage is clear, and downstream customers are increasingly willing to experiment. A pricing mechanism that ensures controllable costs, balanced supply and demand, and moderate fluctuations will not only safeguard profitability across the supply chain but also enhance magnesium’s competitiveness in the lightweighting arena. Moving forward, coordinated efforts across policy, technology, and market levels will be essential in driving the magnesium industry toward high-quality applications.
Asian Metal: Thank you, Mr. Hu, for your comprehensive insights. We look forward to witnessing Luffy Magnesium achieve even greater milestones in the future.
Xiongguang Hu: Thank you to Asian Metal for providing this platform. I also look forward to your continued efforts in delivering timely and accurate market intelligence and in supporting the development of the magnesium industry.
