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Mercedes-Benz is latest automaker to embrace low-carbon steel in manufacturing

SSAB low-carbon steel

SSAB has been working alongside iron ore miner LKAB and Swedish state-owned energy firm Vattenfall to develop the HYBRIT (Hydrogen Breakthrough Ironmaking Technology) system.

SSAB

Mercedes-Benz has become the latest major carmaker to attempt to source low-carbon steel to help manufacture its vehicles, last week announcing a partnership with steelmaker SSAB, one of the leading firms behind the pioneering HYBRIT fossil fuel-free steel facility in Sweden.

The German car brand, owned by auto giant Daimler, is aiming to ensure all its new passenger cars are "carbon neutral" across its entire value chain by 2039 at the latest, and as such it has teamed up with SSAB to source steel produced using green hydrogen, rather than coking coal.

The carmaker plans to use the fossil-free steel "as quickly as possible" to make prototype parts for car body shells, which it said were already being planned for next year.

The shift towards green steel is set to complement Mercedes-Benz's wider plans to only manufacture electric vehicles (EVs) by the end of the decade, "where market conditions allow."

Since 2016, SSAB has been working alongside iron ore miner LKAB and Swedish state-owned energy firm Vattenfall to develop the HYBRIT (Hydrogen Breakthrough Ironmaking Technology) system, which is being piloted at its site in Luleå, Sweden.

The firms claim the process virtually eliminates carbon dioxide emissions from steelmaking, which at present remains heavily reliant on fossil fuels worldwide, and is therefore seen as a major challenge in the quest for a net-zero emissions economy.

The firms claim the process virtually eliminates carbon dioxide emissions from steelmaking, which at present remains heavily reliant on fossil fuels worldwide.

Last month, the Luleå plant marked a major milestone in the development of fossil-free steel production worldwide, revealing that the first steel produced using the HYBRIT technology had been delivered to carmaker Volvo, which is planning to use the low CO2 metal to produce concept cars.

SSAB plans to supply the market with fossil fuel-free steel at a commercial scale from 2026 once it converts its Oxelösund blast furnaces to an electric arc furnace, and deploys the HYBRIT technology — which uses green electricity and hydrogen in the steelmaking process — as a replacement for coal. It then plans to gradually convert all its operations to become a fossil fuel-free metals company by 2045 at the latest.

Martin Lindqvist, president and CEO of SSAB, welcomed Mercedes-Benz as the latest partner for its fossil-free steel products. "Together, we are building an entirely fossil-free value chain all the way to the end customer," he said. "We are proud to reduce global carbon dioxide emissions in collaboration with our new partner."

The deal marks the second green steel tie-up announced by SSAB this month, with the firm also revealing it has partnered with automotive tech firm Faurecia to jointly explore the development of fossil-free, advanced high-strength steel for use in manufacturing car seats.

As part of the collaboration, Faurecia plans to start equipping its seat structures with SSAB green steel from 2026 onwards.

Patrick Koller, CEO at Faurecia, described the partnership as "a major step in our CO2 neutrality journey for Scope 3" value chain emissions.

"We are very proud to be the first automotive supplier to secure fossil-free steel produced by SSAB," he said. "We are driving our roadmap with conviction and determination and take every step possible to achieve our ambition."

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