Map to the Future: How Automakers Can Join the Race to Green Steel

As car companies race to meet ambitious environmental goals, every aspect of the auto supply chain is evolving — even the materials that go into making cars in the first place.  

Steel is a major component of every vehicle, but its production traditionally generates significant carbon emissions. “Green Steel,” however, is made via cleaner processes, resulting in lower emissions. That’s why CALSTART, as part of its mission to decarbonize the automotive sector, is working with stakeholders in the sector to navigate a one-way journey to Green Steel, with no looking back in the rearview mirror.  

CALSTART’s Green Steel Program engages automakers, supports green steelmakers, and accelerates the shift to a truly zero-emission transportation system.  

So how can companies say goodbye to the status quo materials of the past and embrace the sustainable steel of the future? We drew a roadmap to success, and it starts with the steps below.  

Understanding Your Current Steel Use 

Automakers need to take stock of the steel they use in all components of a car, from body panels to structural parts. The choice of steel grade depends on factors like strength, formability, and cost. Whereas mild steel is low-cost and used for parts like brackets and fasteners, Ultra-High-Strength Steel (UHSS) is important for critical structural parts, like door intrusion beams and bumper reinforcements. 

Understanding how your steel is sourced — your suppliers, and how they manufacture the product — is vital. From Nippon Steel to ArcelorMittal to POSCO, manufacturers operate differently and adhere to different standards. It’s important to be aware, for example, if your steel mostly comes from blast furnace-basic oxygen furnace (BF-BOF) production (primary steel, high emissions) versus electric arc furnace (EAF) production. To change your steel, you have to know your steel.  

Assessing the Carbon Footprint of Your Steel  

And knowing your steel also means knowing its environmental impact, which means knowing about Scope 3 emissions. These are indirect greenhouse gas (GHG) emissions that occur across a company’s value chain, including both upstream and downstream activities. Unlike Scope 1 (direct emissions) and Scope 2 (purchased energy emissions), Scope 3 covers all other indirect emissions linked to any given automaker’s operations. 

More broadly, what are your suppliers’ carbon reduction plans or commitments? It helps if they maintain sustainability certifications through organizations like Responsible Steel, an independent standards and certification program for steel in accordance with the ISEAL Codes of Good Practice. 

Most critically of all, what are your emissions reduction targets that address key materials like steel? Are you aligned with initiatives such as SteelZero, the First Movers Coalition (FMC), the Sustainable Steel Buyers Platform, or the Science Based Targets initiative (SBTi)? Factoring in alignments like these will help you establish a baseline for benchmarking future progress.  

Defining Your Path to Green Steel 

The next part is where the rubber (or metal) meets the road — taking action to augment your steel strategy for increased sustainability. While this is generally the purview of Executive Teams, those in the organization focused on supply chain and sustainability can and should be involved. It’s time to make a plan for volume and timeline targets for low-carbon or near-zero emissions steel adoption. It’s also time to determine how much you’re willing to invest or pay to meet your green steel goals.  

When you’re exploring potential suppliers, you might consider offtake agreements, where you agree to purchase a certain quantity of steel produced using low-carbon or renewable energy methods before production begins. This can be crucial for emerging green steel producers to secure revenue and reduce risk.  

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At CALSTART, we are working directly with automakers to help them follow this roadmap exactly. Once you commit to charting the path, it doesn’t take long to begin the journey to a greener destination. It all starts with a cohesive, actionable strategy for decarbonization. 

CALSTART’s Green Steel Program stands ready to support you on this journey — bridging sustainability goals with supply chain solutions to help drive a truly zero-emission transportation future.