Volvo Group and steel-maker SSAB have signed a collaboration agreement on research, development, serial production and commercialization of the world’s first vehicles to be made of fossil-free steel. Volvo plans already this year to start the production of concept vehicles and components from steel made by SSAB using hydrogen.
Plans are for smaller-scale serial production to start during 2022 and for a gradual escalation towards mass production to follow.
We are determined to be a climate-neutral company by 2050 in line with the Paris Agreement. This means that our vehicles and machines will be emission-free when in operation but also that we will review the materials, like steel, used in our products and will gradually switch to fossil-free alternatives here as well. This is an important step on the road to completely climate-neutral transports.—Martin Lundstedt, President and CEO at Volvo Group
Volvo and SSAB will also work together in research and development to optimize the use of steel in Volvo’s products with regard to weight and quality. Together, the two companies will develop a number of products of fossil-free steel with the goal of reaching serial production within a few years.
Newly made fossil-free steel from SSAB will be an important complement to the traditional and recycled steel used in Volvo’s trucks, construction equipment and other products. Fossil-free steel will be made by a new technology using fossil-free electricity and hydrogen. The result will be a much lower climate impact and a fossil-free value chain. The steel industry considers that the need for steel will grow significantly in the long term and that newly made fossil-free steel will be needed to meet this demand.
The collaboration framework also includes a review of common logistics solutions that can contribute to reducing SSAB’s environmental impact from internal and external transports. The ambition is to use Volvo vehicles that are powered by batteries or fuel cells.
SSAB aims to start supplying the market with fossil-free steel at a commercial scale in 2026. Development of a fossil-free value chain from mine to finished steel products will take place within the framework of the HYBRIT initiative, which SSAB has been driving with LKAB and Vattenfall since 2016.
A pilot plant has been in place since August 2020 and this will soon start to produce smaller volumes of sponge iron made using hydrogen. This steel will be used to make the steel for use in this collaboration. Another sponge iron plant is planned for Gällivare and this will be operating in 2030 to process total production from the first fossil-free pellet plant. Total capacity will be 2.7 million tonnes of fossil-free sponge iron a year.