Industry News & Progress

Mercedes and H2 Green Steel announce agreements in both Europe and North America

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.

ArcelorMittal to supply recycled and renewably produced steel to General Motors

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.

Progress on battery chemistries holds potential to reduce demand for high-intensity minerals

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.

Ford and VW nickel partnerships in Indonesia may impact local environment and community’s health

Ford and VW both announced new partnerships and investments in nickel and an “EV ecosystem” in Indonesia. While the Ford announcement includes claims of “sustainable and low-carbon nickel” and “setting the right ESG standards,” few details are provided and there are numerous allegations of environmental damage, local community land grabs and displacement, and impacts on local communities’ health.

The Indonesian government has stated they intend to improve the environmental monitoring of nickel operations and that new smelters would only be approved if they used renewable energy, as well as deadlines for existing smelters to switch from coal to renewable energy.

As of mid April, the Business and Human Rights Resource Center had contacted Ford but had not yet received a response. Both Ford and VW should provide detailed information about how they plan to use their leverage in these partnerships in order to ensure these projects implement stringent human rights and environmental protections, whilst also truly benefiting, rather than harming, local communities.

Mercedes announces new supply chain goals, including steel, aluminum, battery recycling, and human rights risk assessment

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.”

By 2026, more than one third of BMW’s steel will be “CO₂-reduced” + “CO₂-reduced” aluminum agreement

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 produces low-carbon, high-strength steel plates

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 invests in resource-efficient battery design and signs agreements for “low CO2” steel and “environmentally-friendly”lithium

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.

Allegations of forced labor and human rights violations, and environmental damage in VW’s supply chains

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.

Allegations of pollution, workers’ rights violations and forced labour in Toyota’s supply chains

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 establishes multiple partnerships on steel, aluminum, and lithium with IRMA certification requirement

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.

Tesla’s gigafactory to use recycled materials in battery cell production

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.”

Allegations of forced labor and human rights violations in rare earth supply chains

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.

Allegations of pollution, workers’ rights violations, forced labor and due diligence failings

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 invests in “low” and “zero” emissions lithium operations with offtake agreement and equity stake

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.)

Allegations of workers’ rights and human rights violations in Stellantis parts plants and supply chains

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.

Nissan to use “low-CO₂” steel and green aluminum

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.

Pollution, child labour, workers’ rights violations and new coal-fired power plants in Hyundai-Kia’s supply chains

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.

Allegations of forced labor

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

Recycling and unionization in GM’s battery supply chain

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. 

Allegations of forced labour, workers’ rights violations and environmental degradation

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 & Volvo-owned Polestar sets goal to produce climate-neutral car by 2030

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. 

Pollution allegations against BYD’s factory in China

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 signs agreements for low-carbon steel & aluminum in Europe, US and China

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.

Allegations of negative environmental impacts & forced labor

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 signs agreements for various “low-carbon” and “zero-carbon” metals, including steel

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

Allegations of supply chain worker rights violations, forced labor and environmental degradation

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.