€130 million deal for supply near zero emissions steel

Global supplier to the automotive industry, KIRCHHOFF Automotive, signs 7-year agreement with H2 Green Steel for the delivery of near zero emissions steel from Boden. 

By teaming up with the Swedish impact company H2 Green Steel, KIRCHHOFF Automotive takes further steps to decarbonize its supply chain and to achieving its sustainability goals.  

“The message from our customers is clear, they want to see products with lower CO2 footprint. This matches our ambitions to be in the forefront of sustainable development in the industry, as well as our legacy where sustainability has always been important. It’s great to be able to work with a new player on the market and the team at H2 Green Steel have really pushed the steel industry to do more and move faster in terms of sustainability”, says Michael Rank, Global Executive Vice President Procurement, KIRCHHOFF Automotive.  

KIRCHHOFF Automotive works ambitiously with sustainability, including its supply chain where steel is the main component in its products, accounting for circa 50% of its material purchases. 90% of its carbon footprint is currently determined by the use of conventionally produced steel and aluminum. Based on orders for upcoming generations of vehicles from international car manufacturers, KIRCHHOFF Automotive sees that the demand for safe and sustainable body-in-white parts will increase strongly in the coming years. 

The order from KIRCHHOFF Automotive will see deliveries of green steel from H2 Green Steel’s Boden plant starting 2027, to KIRCHHOFF Automotive’s plants across Europe.  

As early as 2022, KIRCHHOFF Automotive began a process of determining the location of greenhouse gas emissions in their supply chain (Scope 3), both upstream at suppliers and downstream at customers. The company also has an overall goal to establish a high level of sustainability in the automotive industry’s supply chains which is also underlined by the fact that KIRCHHOFF Automotive is one of the founding members of the “Responsible Supply Chain Initiative RSCI e. V.” association. 

“Suppliers to the automotive industry have to follow the ambitious plans that progressive car makers have set out. However, we also have a group of companies that run before the rest as they follow their own compass. KIRCHHOFF Automotive is one such company. They combine their impressive legacy with a strong direction for the future where sustainable products are as much a competitive edge, as they are important for the climate and sustainability targets”, says Stephan Flapper, Head of Commercial, H2 Green Steel.

H2 Green Steel is committed to the Scope 1, 2 and upstream Scope 3 requirements as defined in the GHG Protocol. The company has a gross embodied carbon emission intensity obligation per tonne of steel included in its customer contracts and the continuous work to reduce emissions will impact KIRCHHOFF Automotive’s material supply chain and its upstream Scope 3 emissions. 

The two companies will also work together on a circularity initiative where the aim is to send at least 30% of the steel scrap volumes back to H2 Green Steel’s electric arc furnaces in Boden for recycling.  

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