Mercedes-Benz AG & H2 Green Steel Secure Supply Deal; to Establish North American Supply Chain

Mercedes-Benz has signed a supply agreement with Swedish start-up H2 Green Steel (H2GS) over approximately 50,000 tonnes of almost CO₂-free steel per year for its European press shops. It has also deepened its partnership through a Memorandum of Understanding (MoU) with the aim to establish a sustainable steel supply chain in North America.

After taking an equity stake in H2GS in 2021, the new supply agreement enables Mercedes-Benz to bring almost CO₂-free steel into series production.

The partner plans to start its production during 2025.

Mercedes-Benz is working with all its suppliers towards a net-carbon neutral supply chain from 2039 at the latest. 

H2 Green Steel is headquartered in Stockholm, Sweden, with its first green steel plant under development in Boden, northern Sweden.

Markus Schäfer, Member of the Board of Management of Mercedes-Benz Group AG. Chief Technology Officer, Development & Procurement , says: “With the supply deal of around 50,000 tonnes almost CO₂-free steel from H2 Green Steel for our manufacturing plants in Europe, Mercedes-Benz and H2 Green Steel are accelerating the creation of a decarbonised, regional and resilient steel supply chain. At the same time, we are taking our partnership to the next level with the aim of establishing a sustainable steel supply chain in North America, another important step towards making the auto industry more resilient and sustainable.”

Dr. Gunnar Güthenke, Head of Procurement and Supplier Quality, Mercedes-Benz Cars , adds: “Together with our strategic partner H2 Green Steel we’ve achieved the next milestone of our local for local strategy in procurement. Based on our initial investment into H2 Green Steel we now have a finalized relevant supply agreement for Europe and are looking at establishing a sustainable steel supply with H2 Green Steel in North America.”

Henrik Henriksson, CEO, H2 Green Steel , comments: “H2 Green Steel exists because pioneering companies in the automotive industry, like Mercedes-Benz, signaled the transition in the steel industry was too slow for them to meet their climate targets. Working side-by-side with Mercedes Benz, we have a partner with whom we can raise the bar when it comes to supply chain emissions, circularity and social sustainability. They are a very strong player to liaise with for our European operations, but naturally also as we endeavor into the steel value chain in North America.”

Mercedes-Benz has set itself the target of making its fleet of new vehicles net carbon-neutral over the vehicles’ entire life cycle by 2039.