Volkswagen Group and Salzgitter have extended their long-standing partnership by signing a memorandum of understanding for the supply of low-CO2 steel. Volkswagen plans to use the steel for future projects from the end of 2025.
The reduction of CO2 emissions in the supply chain is a key element in Volkswagen’s strategy to gradually become a carbon-neutral mobility provider by 2050. In doing so, the manufacturer is pursuing the approach of a so-called hot spot analysis – it is concentrating on reducing CO2 emissions where they are mainly generated during the production of a car. By the end of 2022, both partners intend to contractually agree on purchase quantities for the steel in the period 2025 to 2030.
The agreement also aims to establish a closed-loop recycling system for steel between Volkswagen’s main plant in Wolfsburg and Salzgitter’s steelworks. Salzgitter processes Volkswagen’s steel residue into new steel products, delivering them to Wolfsburg for use in vehicle production. The aim is to extend this closed loop for steel to other Volkswagen production sites in future.
Cooperation between the two companies on so-called ‘green steel’ has already begun. Last year Volkswagen processed sample quantities of CO2-reduced steel from Salzgitter, which it says has a 66 per cent reduced CO2 footprint. This year Volkswagen plans to purchase a further 3000 tonnes.
“Purchasing is a decisive factor for the Volkswagen Group on the road to CO2 neutrality and we want to achieve this goal by 2050 at the latest,” said Murat Aksel, Group Board Member for Purchasing at Volkswagen.
Gunnar Groebler, Chairman of the Executive Board of Salzgitter, welcomed the extended cooperation with Volkswagen. “The decarbonisation of society and the economy can only succeed with the cooperation of strong partners. Our joint project is an excellent example of this new way of doing business – the circular economy with closed material flows,” Groebler said.