Industry News & Progress

On August 01 2024, Stellantis approved a standalone company policy on Free, Prior and Informed Consent, becoming the first automaker to approve a standalone policy on this issue. The policy states that “The protection of Indigenous Peoples’ rights aligns with our core values of ethics and integrity, and our fundamental commitment to social responsibility. We believe, however, that the implementation of our FPIC policy also serves to reduce the potential for conflicts and legal disputes, fostering trust, positive relationships, and long-term operational stability in the communities where we are present.”

Global automakers Honda and Mercedes are facing allegations that they have engaged in illegal union-busting activities in the U.S. Honda has been accused by the National Labor Relations Board of violating the rights of workers at a Greensburg, Indiana, factory by illegally cracking down on union organizing. Mercedes, meanwhile, has been accused by the UAW of engaging “in a relentless anti-union campaign” including the firing of employees who were pro-union and holding frequent captive-audience meetings to spread anti-union views, according to the filing.

Volkswagen AG and Vulcan Green Steel have signed a Memorandum of Understanding (MoU) for a partnership for low-carbon steel – a key element of Volkswagen’s green steel strategy.

A new report by Global Witness has documented the harmful impacts of illegal rare earth mining in Myanmar, linked to the supply chains of major automakers – including Volkswagen, Toyota, Tesla, Nissan, Ford and Hyundai.

Nissan says it will use low CO2 emission aluminium parts made from green or recycled aluminium in new and current models from fiscal year 2024 onward and aims to complete the full transition to such parts by 2030.

Aluminium accounts for approximately 10% of vehicle weight. By using low CO2 emission aluminium, Nissan says it aims to take a significant step towards achieving carbon neutrality.

It wants to achieve carbon neutrality in the entire lifecycle of its vehicles by 2050.

Green aluminium is produced using non-fossil fuel-derived electricity and can reduce CO2 emissions during production by approximately 50%.

Additionally, recycled aluminium can reduce CO2 emissions by approximately 95%. Nissan has been purchasing low CO2 emission aluminium sheets for vehicle panels produced in Japan from Kobe Steel, Ltd. and UACJ Corporation.

A massive, multi-billion-dollar nickel industrial complex in North Maluku and nearby nickel mining is violating the rights of local communities, including Indigenous Peoples, causing significant deforestation, air and water pollution, and emitting massive amounts of greenhouse gases from captive coal plants, Climate Rights International said in a report. 

For the 124-page report, “Nickel Unearthed: The Human and Climate Costs of Indonesia’s Nickel Industry,” Climate Rights International interviewed 45 people living near smelting operations at the Indonesia Weda Bay Industrial Park (IWIP) and nearby nickel mines on the island of Halmahera. Local residents explained how companies, in coordination with Indonesian police and military personnel, have engaged in land grabbing, coercion, and intimidation of Indigenous Peoples and other communities, who are experiencing serious and potentially existential threats to their traditional ways of life.  

Electric vehicle companies such as Tesla, Ford, and Volkswagen that have contracts to source nickel from Indonesia, including from companies with operations at IWIP, should immediately use their leverage to push suppliers to address harms to local communities and the environment, and if necessary, suspend sourcing nickel from companies responsible for such abuses. 

Mercedes-Benz and H2 Green Steel have signed a binding agreement for the delivery of about 50.000 tonnes of green steel to the car maker’s European production annually. In a pioneer move Mercedes-Benz has also signed a memorandum of understanding with H2 Green Steel for the potential supply of green steel produced in North America.

A report released by Mighty Earth highlights GM’s $650 million investments in Lithium Americas Corp to help the company develop its Thacker Pass lithium mine project, which has proceeded without obtaining Indigenous Peoples’ rights and free, prior, and informed consent (FPIC) and is widely opposed by the People of Red Mountain.

ArcelorMittal North America said on Tuesday the steelmaker will supply General Motors (GM.N) with recycled and renewably produced steel, which substantially lowers CO2 emissions.

Material will be supplied from ArcelorMittal Dofasco in Hamilton, Ontario and shipments are expected to begin in the second quarter of 2023, the company said. The terms of the deal were not disclosed.

During the first few months of 2023, several automakers have made announcements of investments and / or progress made on new battery chemistries that promise to reduce their demand of high-intensity minerals such as cobalt, nickel and lithium. In March, the JAC Group’s joint venture with Volkswagen in China made history by introducing the world’s first electric vehicle (EV) powered by a sodium-ion battery – a battery technology that, according to the IEA, “has the potential to completely avoid the use of critical metals.” BYD has also said that it plans to use sodium-ion batteries in its vehicles later in the year. In May, Stellantis announced an investment in lithium-sulphur battery developer Lyten, working on a novel three-dimensional graphene material platform that is free from nickel, cobalt, and manganese.

At Mercedes annual ESG Conference 2023, Mercedes announced further supply chain priorities, plans, and investments across several areas.

Mercedes set “the goal of a green steel supply chain from 2039 at the latest,” including “low-CO2” steel from scrap already part of their vehicles, further details on their partnerships with H2 Green Steel and SSAB, including prototyping parts that contain “almost fossil-free direct-reduced iron,” and their intention to launch models from 2025 that use “almost CO2-free” steel. Like BMW, Mercedes also stated they see themselves as “promoting the transformation of the steel industry.”

Regarding aluminum, Mercedes stated they are working on decarbonization, however did not provide specific targets or milestones. They did state that “a third of the aluminium used in Europe” for EVs will be made with renewable energy, and that they are testing aluminum from Hydro with a minimum 25% scrap content, with the aim of it being incorporated into production this year. Each results in 50% and 70% lower CO₂ emissions, respectively. Also with Hydro, Mercedes plans to pilot “very low CO₂” aluminum by 2030.

Mercedes’ new battery recycling factory will increase their operations and achieve a recycling rate of more than 96%, with the potential to recycle “2,500 tonnes of battery modules per year.” They are also working with partners in China on recyclable materials. Additionally, Mercedes are aiming to reduce the CO2 footprint of battery cells by 40% with further emissions reductions’ possible with renewable energy to produce and refine raw materials.

Mercedes also shared further details on their timeline and milestones to assess 24 raw materials with elevated human rights risks: 70% by 2025 and completed by 2028. They also stated that this year, they plan to “establish risk mitigation measures for all raw materials affected by the future EU battery regulation.”

As part of their value chain-wide climate neutrality by 2050 goal, BMW stated their focus on CO₂-intensive materials, including aluminum and steel.

On steel, from 2026, more than one third of BMW’s steel worldwide will be “CO₂-reduced steel,” eliminating approximately 900,000 tonnes of CO₂ annually. They state that this is based on contracts with suppliers in Europe, China, and the US. BMW also noted that they see their efforts as “promoting the transformation of the steel industry.”

On aluminum, BMW have signed a declaration of intent with Rio Tinto in Canada for “significantly CO₂-reduced” aluminum from 2024. BMW states that compared to conventional methods, “the process avoids around 70% of CO₂ emissions.” This aluminum will be used exclusively in vehicle production at BMW’s Spartanburg plant in the US.

Hyundai Steel says it has become the first steelmaker globally to produce high-strength steel plates by using an electric arc furnace, which helps reduce carbon emissions drastically during the whole process… part of the company’s carbon neutrality initiative, dubbed “Hy-Cube,” with a goal of switching completely to hydrogen-based steel production by 2030.

VW has taken a stake in 24M Technologies whose battery technology claims to require 40% less production area, is more efficient for recycling, and reduces the CO2 footprint of battery production. VW has also signed agreements for “low-CO2” steel from the end of 2025 with Salzgitter and for lithium with Vulcan Energy Resources. Their process claims to use less land, groundwater and energy.

The Business and Human Rights Resource Center has documented multiple allegations of human rights abuses against VW, including forced labor, union busting and health impacts linked to its emissions scandal. Nikkei Asia also reported on environmentally damaging nickel mining in Indonesia that identified VW as an end consumer.

The Business and Human Rights Resource Centre has linked cases of multiple human rights and environmental harms to Toyota’s supply chains, including allegations of pollution and deforestation, forced labour and violations of workers’ rights.

Mercedes will procure “low-carbon aluminum” from Norsk Hydro, launched a partnership with SSAB to “introduce fossil-free steel into vehicle production as early as possible,” their China operations (Beijing Benz Automotive, BBAC signed an MoU with Baosteel for reduced-emissions steel and, in the future, green steel, and signed a lithium supply agreement with Rock Tech Lithium Inc. that will include creating a roadmap to achieving “CO₂ neutral production” of lithium hydroxide by the end of 2030. It also requires that all lithium hydroxide shall be sourced from mining sites audited by the Initiative for Responsible Mining Assurances (IRMA). Mercedes also recognized an established supplier, Big River Steel, with a sustainability award.

According to TechCrunch, “Panasonic battery cells made at the Gigafactory it operates with Tesla will use more recycled materials by the end of 2022 as part of an expanded partnership with startup Redwood Materials.

Panasonic said Tuesday at the 2022 CES tech trade show that Redwood Materials will start supplying it with copper foil produced from recycled materials, a critical component of the anode side of a battery cell. Redwood will begin producing the copper foil in the first half of the year; the copper foil will then head to Panasonic where it will be used in cell production by the end of the year.”

The Business and Human Rights Resource Center has documented allegation that implicate Mercedes’ supply chains in forced labor and human rights violations in rare earth mining.

The Business and Human Rights Resource Centre documents multiple allegations of human rights violations in Tesla’s supply chains, including pollution, forced labor, violations of workers’ rights, and failings to ensure effective human rights diligence. Nickel sourced by Tesla from Indonesia has also been linked to pollution affecting local communities. 

Stellantis has taken an equity stake in Vulcan Energy Resources that plans to mine lithium with zero greenhouse gas emissions, using a direct lithium extraction (DLE) method that uses less land and groundwater. Stellantis has also signed an offtake agreement for “low-carbon lithium” with Controlled Thermal Resources Ltd in the Salton Sea area of Southern California. (Note that there have also been local community concerns raised about this project.)

Allegation have been raised against Stellantis over workers’ rights violations in their auto parts plants, human rights violations in their rare earth supply chains, and forced labor.

From January 2023, Nissan announced plans to use “low-CO₂” steel and green aluminum from Kobe Steel.  Kobenable steel claims to significantly reduces CO2 emissions in the blast furnace process and is “the first time Kobenable Steel will be used in mass-produced vehicles.” They state that the aluminum will be made with solar power only and use recycled aluminum.

According to the Business and Human Rights Resource Centre, Hyundai-Kia’s supply chains have been linked to child labour and workers’ rights violations. Reports also implicate Hyundai-Kia’s supply chains with air pollution and premature deaths in South Korea and environmental contamination in Indonesia.

Hyundai Motor Company also signed an MoU to purchase aluminium from Adaro in Indonesia, which would be powered by new coal-fired power plants.

The Business and Human Rights Resource Centre has documented allegations of forced labor in Nissan’s supply chains.

In November 2022, GM and Cirba extended an agreement for the recycling “of lithium-ion batteries and cell scrap generated by manufacturing and research at select GM facilities through 2024.”

In December 2022, workers at a battery plant of GM supplier Ultium voted overwhelmingly in favor of union representation by the United Auto Workers Union. 

According to the Business and Human Rights Resource Centre, GM’s supply chains have been implicated in forced labour, environmental damage and workers’ rights violations.

Geely, together with Volvo, own a majority stake in the carmaker Polestar which has set an ambitious target of producing a completely climate neutral production car that fully eliminates greenhouse gases from production by 2030. Polestar has also partnered with Circulor to use blockchain technology to track a wide range of raw materials and achieve more sustainable supply chains. With the new partnership, Polestar and Circulor have set a progressive scope and ambition that aims to entail a range of raw materials, focusing on those with identified risks in either environmental and/or human rights, such as nickel, mica, manganese, graphite and lithium, amongst others. 

BYD’s Changsha factory has faced allegations of damaging pollution, which left citizens and children unwell, with 600 children near the factory reporting repeated nosebleeds according to reports.

BMW has signed agreements with Salzgitter AG in Europe, Steel Dynamics (SDI) and Big River Steel in the U.S. and HBIS Group in China for low-carbon steel to be used in its production cycles. In February 2023, BMW also signed an agreement to source reduced CO2 aluminum from Rio Tinto for its US vehicle production.

The Business and Human Rights Resource Centre has documented allegations against BMW’s supply chains for being implicated in environmental harms affecting the rights of Indigenous Peoples and forced labor. Reports also link BMW’s nickel supply chain with pollution in Indonesia.

Ford has established agreements for “low carbon” steel, ”low-carbon” battery and other metals, and a program to help suppliers eliminate their emissions.

Ford’s supply chains have been implicated in alleged worker rights violations, forced labor and environmental pollution affecting the health of local communities: see BHRRC for details and automaker responses.