On Thursday, Novelis Incorporation announced to build a $2.5 billion low-carbon aluminium recycling and rolling plant in the US to cater to expand the beverage demand in the automotive market.

In the company’s statement, the facility, which will be built in Alabama, will have a capacity of 600,000 tons of finished goods a year initially, the unit of Hindalco Industries Ltd. The work at the site is underway, and the company expects to begin operations by the mid of 2025, they said.

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The new facility will increase Novelis’s recycling capacity to 90 billion cans globally, from 74 billion, it said. Also, more than three-fourths of the capacity will be used to increase demand for aluminium beverage can sheets in North America as customers seek more sustainable packaging.

“It’s really on the back of a resurgence of beverage cans as the most sustainable solution from a packaging standpoint,” Steve Fisher, the chief executive of Novelis, said in a phone interview. “You’re seeing it from our customers preferring more and more infinitely recyclable aluminium.”

North American can demand was effectively flat between 2010 and 2018. Still, Fisher said canmaking investments had totalled about $4 billion since then as consumers increasingly have ditched plastic for more sustainable packaging.

That’s enough to produce some 38 billion new cans annually amid rapidly expanding shortages that have forced companies to airship cans from Brazil, Saudi Arabia and Asia.