Environment and community groups are calling on Hyundai to ensure its $6 billion investment in a new steel plant in Louisiana uses zero carbon steel methods that do not contribute to already high pollution levels in the region, known as ‘Cancer Alley’.
Lead The Charge, a global coalition pushing for fair and sustainable auto supply chains, said the major announcement by the South Korean car maker on Monday must be followed up with evidence to back up their “low carbon” claims, and serious negotiations to ensure harm reduction to and benefits for the local community and environment.
Hyundai yesterday said its investment would be “advancing future technologies” but questions remained about the potential harm:
- Hyundai’s announcement of an integrated steel mill using direct-reduction ironmaking and electric arc furnace signals a commitment to lower-carbon steel production – and an important demonstration that auto grade-steel doesn’t need to rely on polluting blast furnaces.
- However, Hyundai chairman, Chung Eui-sun, stated overnight the company will purchase US LNG (liquified methane gas). This suggests the plant will rely on harmful gas for ironmaking, when it should be transitioning to near-zero carbon emissions green hydrogen, which would also ensure significantly lower air pollution.*
- Hyundai also failed to commit to renewable energy as the electricity source for the electric arc furnace in the steel making process.
The area where the steel project is proposed is part of Louisiana’s ‘Cancer Alley’, known for toxic levels of pollutants resulting in high rates of illnesses, due to high concentration of petrochemical facilities. Hyundai’s statement on the steel project fails to acknowledge community concerns about new industrial development which could raise pollution levels and threaten lives.
The groups said Hyundai must work hard with local communities, labor unions and environmental groups to address serious concerns over how it operates in other regions:
- A worker at the Hyundai battery megaplant in Bryan County Georgia died on Friday in a forklift incident. Separately, a worker was hospitalised on March 3 after a pipe explosion.
- Local media exposed that 91 calls were made to emergency services from the Bryan County megaplant between January 2023 and August 2024
- Workers and their representatives have complained of bad working conditions and union-busting tactics
- Hyundai has been exposed over the use of child labor and prison labor at its car manufacturing plants in Alabama
- A report details how Hyundai sources steel and aluminum for its cars and materials for its steel plants from companies involved in human rights violations and environmental disasters.
Hyundai’s has stated in its principles ‘Progress for Humanity’ that “emissions-free mobility [is] a fundamental human right” and the supply chain—in this case, their own steel subsidiary—is “net zero”. Given these commitments, Hyundai has the opportunity to both stride ahead in the industry and fulfil its mission, but without a clear plan for green hydrogen and renewable energy, and meaningful engagement with local communities, Hyundai risks falling short of their stated aspirations.
Matthew Groch, Mighty Earth
“Hyundai’s announcement is intended to highlight its focus on the American market and its expanding EV production, but the company’s steel supply chain for these vehicles remains deeply troubling. Hyundai hopes to project an image of itself as an industry leader in the transition to EVs and sustainability, even as its steel supply chains remain linked to Russian coal, labor violations, pollution-related deaths, and the disappearance of activists. Hyundai says its new $5 billion steel mill will produce “next-generation” steel—but progress truly worth celebrating would be Hyundai committing to steel made with green hydrogen instead of dirty coal or natural gas and with full protections for human rights and the environment.”
Yong Kwon, Sierra Club
“It is not all clear from Hyundai’s public statement that the company has engaged with the local community in Louisiana to discuss the impact of this facility on public health and how this new facility might add to existing pollution in the local area. In addition, the statements from Hyundai do not address whether the company has considered all the pathways to secure a supply of steel made from green hydrogen. These uncertainties exist not only because Hyundai does not appear to be engaging with local communities, but also has not established measurable public goals to use steel made without fossil fuels.”
Background: Lead the Charge issues an annual ranking of 18 global automakers based on their efforts to build equitable, sustainable, and fossil-free supply chains as they transition to electric vehicles. This year’s analysis shows Hyundai has failed to improve steel and aluminum decarbonization and saw a major drop on workers’ rights.
*Gas-based DRI is less polluting than coal-based blast furnaces but green hydrogen-based DRI produces significantly lower pollution than fossil gas-based DRI.