Kirchhoff Automotive, H2 Green Steel sign low-carbon steel delivery offtake deal

Kirchhoff Automotive signed a seven-year agreement with H2 Green Steel for the delivery of low carbon steel to decarbonize its supply chain, the two companies announced Jan. 16.

“The message from our customers is clear, they want to see products with lower CO2 footprint,” said Michael Rank, global executive vice president of procurement at Kirchhoff Automotive.

“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.”

The deliveries of green steel to Kirchhoff Automotive’s plants across Europe from H2 Green Steel’s Boden plant will start in 2027. The offtake agreement is reported to be worth Eur130 million, but the two companies did not disclose the tonnages volume.

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

For Kirchhoff Automotive, 50% of its supply chain is steel, of which 90% of its carbon footprint is currently determined by the use of conventionally produced steel and aluminum.

In 2022, Kirchhoff Automotive started locating the greenhouse gas emissions in its supply chain (Scope 3), both upstream at suppliers and downstream at customers.

Author Annalisa