LVMA's customers often encounter difficulties breaking down the costs of various aspects of die casting automotive parts during the design process, such as raw materials and labor. Customers typically cannot accurately calculate part costs at this stage.

This article provides a detailed breakdown of the costs of die-cast automotive parts, using Mid-Sized Aluminum Motor Housing as an example, to help you understand the cost composition of die-cast parts.

Cost Structure Breakdown (Mid-Sized Aluminum Motor Housing Example)

Taking a mid-sized aluminum alloy motor housing as an example, the ex-factory price is approximately RMB 120(≈ USD 17.1) per unit. The cost structure mainly consists of raw materials, manufacturing, tooling amortization, R&D allocation, and selling and administrative expenses.

Raw Material Costs

Aluminum die casting material costs account for approximately RMB 66–72(≈ USD 9.4–10.3) per unit (55–60%). Aluminum alloy ingots contribute RMB 50–55(≈ USD 7.1–7.9), representing 75–80% of total material costs, while recycled materials, additives, and consumables account for RMB 16–17(≈ USD 2.3–2.4).

Manufacturing Costs

Manufacturing costs range from RMB 24–30(≈ USD 3.4–4.3). Equipment depreciation, including die casting machines, molds, and auxiliary equipment, accounts for RMB 10–12 (≈ USD 1.4–1.7), while labor costs total RMB 6–8 (≈ USD 0.86–1.14) for operators and quality inspectors.

Utilities and Facility Expenses

Utilities such as electricity and water contribute RMB 4–6 per unit (≈ USD 0.57–0.86), while factory rent adds approximately RMB 4 (≈ USD 0.57). Together, these costs represent a stable but rising portion of overall manufacturing expenses.

Tooling Amortization

Tooling costs are amortized at RMB 9.6–14.4 per unit (≈ USD 1.37–2.06), based on a mold cost of RMB 1.2 million (≈ USD 171,400) and a tooling lifespan of 500,000 cycles.

R&D Cost Allocation

R&D expenses account for approximately RMB 6–9.6 per unit (≈ USD 0.86–1.37), covering product design, process development, trial production, and validation activities.

Selling and Administrative Expenses

Selling, marketing, and management expenses represent RMB 3.6–6 per unit (≈ USD 0.51–0.86), including sales operations, management overhead, and administrative support.

Key Cost Pressures in 2025

Cost pressure in 2025 mainly comes from raw material price volatility, with aluminum ingot prices fluctuating by ±10–15% annually and magnesium ingots by ±15–20%, alongside rising labor, energy, and environmental compliance costs.

Labor, Environmental, and Energy Costs

Skilled labor wages are increasing by 8–10% annually. Environmental compliance costs, including VOC treatment, wastewater, and solid waste management, are rising to 3–5% of total costs, while electricity and natural gas prices remain volatile.

Cost Control Strategies of Leading Manufacturers

Leading companies mitigate cost pressure through material optimization (lightweight design and alloy substitution), automation (reducing labor cost share below 15%), tooling optimization (extending mold life beyond 600,000 cycles), and supply chain integration.

Profitability Overview

Industry-wide gross margins average 18–25%. High-end products such as integrated die casting and precision structural components, can achieve margins above 30%, while basic die casting parts typically maintain margins of 15–20%.

Conclusion

This article provides insights into automotive die casting part costs in 2025, including raw materials, manufacturing, molds, R&D, and administrative expenses, helping you improve the profitability and efficiency of both high-end and standard die castings. For any further questions about die castings, please feel free to contact LVMA.