Automakers Use Green Steel for EV Competitive Edge
Automakers are using clean materials such as low-carbon steel as a competitive marketing tool for new EV models, according to a market report out today that ranks and assesses the supply chain sustainability of 18 car makers.
Car makers Volvo and Mercedes are disclosing for the first time the specific quantities of low-carbon steel used in specific EV models, according to the fourth edition of the Lead the Charge Auto Supply Chain Leaderboard. Mercedes’ new CLA uses 39 kg of steel from electric arc furnaces (EAFs) using renewable energy, while Volvo’s ES90 uses 18% recycled steel and 43% primary aluminium produced with renewable energy. Chinese automaker, Geely, also disclosed that its Zeekr Mix model uses 15% 'renewable steel.'
The move shows how automakers increasingly see economic value, competitive advantage and consumer choice in selling EVs made with cleaner materials. As the transition to EVs accelerates, demand for green steel will further increase, leaving steelmakers that fail to make the necessary investments today at risk of losing major customers.
Other findings from this year’s Leaderboard include:
Tesla has disclosed that it is 'working with mainstream steel mills for a mid-term transition away from blast furnace production and toward direct reduction without coal that will systematically reduce emissions.'
Hyundai and Kia disclosed intentions to expand their use of low-carbon steel, although they did not provide additional details on their plan to do so.
Volvo has published a position paper on sustainable steel that outlines the challenges in steel decarbonization and how the company intends to use its leverage to address those challenges.
Mercedes has signed multiple offtake agreements for low-carbon and fossil free steel and aluminium across multiple regions, and discloses the specific quantities to be procured for some of these agreements.
Overall, the number of automakers taking action to decarbonise the steel used in their vehicles has risen from a minority of companies in 2023 (7/18) to a decisive majority in 2026 (13/18)
"This year's leaderboard demonstrates it is possible to disclose more granular data on supply chain practices and emissions, catalyzing a race to the top. Ford, Volvo and Mercedes set the curve and demonstrated how much climate laggards like Toyota have fallen behind. To remain competitive, other automakers must disclose disaggregated emissions and sourcing information on their steel, aluminum, and battery supply chains."
Abhilasha Bhola, director of the Auto Supply Chain Campaign, Public Citizen
"This year's leaderboard demonstrates it is possible to disclose more granular data on supply chain practices and emissions, catalyzing a race to the top. Ford, Volvo and Mercedes set the curve and demonstrated how much climate laggards like Toyota have fallen behind. To remain competitive, other automakers must disclose disaggregated emissions and sourcing information on their steel, aluminum, and battery supply chains," said Abhilasha Bhola, director of the Auto Supply Chain Campaign, Public Citizen.
"Steel is one of the largest contributors to automakers’ Scope 3 emissions, yet many East Asian automakers, including Hyundai Motor and Kia, still lack clear, steel-specific decarbonization roadmaps. Compared to global best practices, they have not established time-bound targets for green steel adoption or credible implementation mechanisms," said Heather Lee, steel team lead with Solutions For Our Climate.
"At the same time," said Lee, "the absence of a globally aligned green steel definition further weakens accountability. To ensure credibility, green steel definitions must align with IEA principles and prioritize transparent, verifiable, and physically achieved emissions reductions. As trade measures such as the EU’s CBAM increasingly link carbon intensity to market access, steel decarbonization is no longer just an environmental issue but a matter of competitiveness," Lee argued.
Matthew Groch, senior director at Mighty Earth and a regular contributor to Steel Times International, commented: “The latest Lead the Charge Leaderboard makes it clear that industry leaders, such as Mercedes-Benz, Volvo, and Geely automakers, are making significant investments in incorporating low-carbon steel and aluminium into the vehicles they sell, not just in sustainability reports. The Leaderboard exposes just how far behind other automakers are in meaningfully addressing the embodied emissions from steel and aluminium in their vehicles. As automakers drag their feet on committing to low-carbon steel and aluminium, they send a signal to suppliers that pollution from fossil fuel-fired blast furnaces and smelters is still acceptable. Hopefully, the latest Leaderboard findings will be a wake-up call to laggard automakers to clean up their steel and aluminium supply now or risk falling even further behind their competitors.”