Driving Toward Net-Zero: How Recycled Steel from SSAB Helps Volvo Cars Slash CO₂ Emissions
In the race toward a carbon-neutral future, every component of a vehicle matters — including the steel it’s built from. With steel contributing to roughly 25% of all material-related CO₂ emissions in car production, reducing its impact is critical for carmakers like Volvo who are aiming for net-zero greenhouse gas emissions by 2040.
Now, Volvo Cars is taking a bold step forward. In a landmark move, the company has signed an agreement with Swedish steelmaker SSAB to source high-quality, recycled, near zero-emissions steel — starting from 2025. This deal marks a turning point in the automotive industry, where sustainable materials are beginning to reshape not just products, but production itself.
Why Steel Matters in Emissions Reductions
Steel is a crucial part of any car, offering the strength, rigidity, and crash safety required for modern automotive design. However, the traditional method of steel production — which relies on coal-powered blast furnaces and iron ore mining — is one of the world’s most carbon-intensive processes.
Recognizing this, Volvo is tackling steel-related emissions head-on. The new agreement with SSAB positions Volvo as the first automaker to commit to integrating recycled, near-zero-emission steel into serial production.
“We work towards achieving net-zero greenhouse gas emissions by 2040, and cutting steel-related emissions really has the potential to move the needle,”
— Francesca Gamboni, Chief Supply Chain and Manufacturing Officer, Volvo Cars
What is SSAB Zero™ Recycled Steel?
Unlike conventional steel, SSAB’s recycled steel is produced using a closed-loop, electric arc furnace (EAF) process powered by fossil-free electricity and biogas — eliminating the need for fossil fuels like coal entirely.
Key Features of SSAB Zero™:
- Made with around 90% recycled scrap steel
- Results in virtually zero CO₂ emissions per ton
- Avoids iron ore mining, reducing resource consumption
- Meets all safety, strength, and durability standards for automotive use
The use of recycled steel is not only better for the environment — it also supports material circularity, a core goal in Volvo’s climate and sustainability strategy.
SSAB Zero™: The Future of Green Steel
SSAB Zero™ is the world’s first commercially available steel of its kind — made entirely from recycled scrap metal, processed using fossil-free electricity and biogas. The result is virtually zero fossil carbon emissions, without compromising the quality or performance characteristics required by modern automotive manufacturing.
Available in a wide range of grades and dimensions, SSAB Zero™ steel meets strict industrial standards while contributing meaningfully to emission reduction goals. The initiative aligns with SSAB’s ambitious plan to eliminate fossil carbon dioxide emissions from its operations, with SSAB Zero™ officially launched in 2023.
“This collaboration marks a significant step forward in our shared commitment to reducing carbon emissions. With forward-thinking partners like Volvo Cars, we continue to lead the transformation of the steel industry,”
— Tony Harris, Head of SSAB Europe
Volvo’s Ambitious Sustainability Vision
Volvo Cars has long positioned itself as a sustainability pioneer in the automotive sector. The steel used in its vehicles contributes to around 25% of the material-related CO₂ emissions of a new Volvo car — a significant source that the company aims to reduce.
With this new agreement, Volvo Cars becomes the first automaker globally to commit to using decarbonized steel in mass production, setting a bold precedent for the rest of the industry. The SSAB Zero™ steel will be incorporated into key components of Volvo’s upcoming EX60 fully electric SUV, as well as other future models built on Volvo’s next-generation SPA3 vehicle architecture.
“We are working towards achieving net-zero greenhouse gas emissions by 2040, and cutting steel-related emissions really has the potential to move the needle.”
— Francesca Gamboni, Chief Manufacturing & Supply Chain Officer, Volvo Cars
Volvo’s road map to sustainability includes:
- 100% electric car lineup by 2030
- 65-75% reduction in CO₂ emissions per car by 2030 (vs. 2018 baseline)
- Full carbon neutrality across the entire value chain by 2040
Why This Matters for the Steel and Automotive Sectors
The automotive industry is one of the largest consumers of steel globally. Traditionally, steel production has been highly carbon-intensive, making it a major contributor to greenhouse gas emissions. By introducing zero-emission steel into vehicle manufacturing, Volvo and SSAB are redefining what sustainable mobility looks like.
This move is more than just symbolic. It proves that innovative green steel solutions are viable at industrial scale and can meet the safety and durability needs of premium automakers. It also challenges other manufacturers to follow suit or risk falling behind in the race toward decarbonization.
The use of recycled materials and fossil-free processes not only minimizes environmental impact but also contributes to circular economy practices, which are becoming increasingly crucial for compliance with EU environmental regulations and global ESG expectations.
🚆 Volvo Cars and Salzgitter Group: A Closed-Loop Steel Cycle
The Salzgitter Group, one of Germany’s leading steel manufacturers, is expanding its relationship with Volvo Cars by creating a closed-loop steel partnership. Already a supplier of flat-rolled steel to Volvo’s body plant in Olofström, Sweden, Salzgitter announced that starting in 2026, the two companies will close the materials loop by recycling scrap steel back into new high-quality steel.
This closed-loop system involves:
- Delivering flat-rolled steel to Olofström via rail using a single-carriage system.
- Returning scrap steel generated at Volvo’s body plant back to Salzgitter’s mills for recycling.
- Using 100% renewable electricity and optimized rail logistics over the 700-km route to minimize emissions.
The logistical model will use high-capacity, compatible locomotives, ensuring heavy load capability with minimal environmental impact. This efficient circular flow of materials preserves steel quality while drastically cutting CO₂ emissions associated with primary production and transport.
🔁 Volvo Cars and SSAB Zero™: A Leap Toward Fossil-Free Steel
In parallel, Volvo Cars has signed a landmark supply agreement with SSAB for SSAB Zero™ — the world’s first mass-produced fossil-free, recycled steel made using biogas and fossil-free electricity. Beginning in 2025, this near-zero-emission steel will be integrated into serial production of Volvo’s new fully electric models, starting with the EX60 SUV.
SSAB Zero™ steel is manufactured using recycled scrap metal in electric arc furnaces, completely avoiding the use of fossil fuels or coal. This process:
- Generates almost 100% fewer CO₂ emissions compared to traditional steelmaking.
- Maintains superior strength and safety standards for use in automotive components.
- Is made from 90–100% recycled content, reinforcing a circular economy.
Volvo’s long-term goal of achieving net-zero greenhouse gas emissions by 2040 aligns perfectly with SSAB’s steel innovation, enabling them to slash steel-related emissions, which account for 25% of the CO₂ footprint of an average new Volvo car.
The EX60 SUV: The First of a New Era
The EX60, Volvo’s upcoming fully electric SUV, will be among the first models to incorporate SSAB’s recycled steel. Built on the SPA3 vehicle architecture, the EX60 represents a new generation of clean, safe, and sustainable vehicles.
This steel will be used in key components of the car, maintaining Volvo’s uncompromising safety standards while setting a new benchmark for low-emission vehicle production.
Volvo’s Climate Action Plan: A Roadmap to 2040
This partnership with SSAB aligns perfectly with Volvo’s broader climate ambitions, which are some of the most ambitious in the global auto industry:
Key Targets:
- Net-zero greenhouse gas emissions by 2040
- 90–100% electrified sales mix by 2030
- 65–75% CO₂ emissions reduction per car by 2030 (vs 2018 baseline)
- At least 35% recycled or bio-based content in new models by 2030
Volvo is not just electrifying its fleet — it’s also transforming its entire value chain, from materials sourcing and production to logistics and recycling.
Circularity in Action: A Closed-Loop Steel Ecosystem
The agreement also reinforces Volvo’s circular economy goals. In addition to sourcing recycled steel, the company will also sell its own steel scrap back to the supply chain, helping to create a closed-loop system that maximizes material value and minimizes waste.
This circular approach:
- Keeps materials in use longer
- Reduces the need for virgin resource extraction
- Lowers overall lifecycle emissions
- Improves supply chain resilience
A Look Back: The Rich History of Volvo Cars
Founded in 1927 in Gothenburg, Sweden, Volvo Cars was born out of a vision for producing vehicles strong enough to withstand Sweden’s challenging road conditions and cold climate. From the very beginning, Volvo has stood for quality, safety, and durability — values that continue to define the brand nearly a century later.
1927: The First Volvo Rolls Out
On April 14, 1927, the first Volvo car, ÖV 4 (nicknamed Jakob), rolled off the production line in Gothenburg. Built with a wooden frame and a 4-cylinder engine, it marked the beginning of what would become one of the world’s most trusted automobile manufacturers.
1940s–50s: Growth and Innovation
In the post-war years, Volvo expanded its operations rapidly. By the 1940s, the company had already built a reputation for reliability and ruggedness. One of its notable achievements during this period was the PV444, launched in 1944, which became a huge commercial success and helped Volvo break into the U.S. market.
1959: The Three-Point Seatbelt – A Revolution in Safety
Volvo’s most significant contribution to automotive safety came in 1959, when engineer Nils Bohlin invented the three-point safety belt, a standard feature in all Volvo cars. Rather than patent it for exclusive use, Volvo made the design freely available to other manufacturers — a move that is credited with saving over a million lives worldwide.
1970s–80s: Environmental Focus and Iconic Models
During the 1970s and 80s, Volvo began to focus more on sustainability and emissions reduction — values that have only strengthened over time. This period also saw the launch of several iconic models, including the 240 series, which became known for its boxy design and unmatched safety ratings.
1990s: Modernization and Global Expansion
In the 1990s, Volvo introduced more refined, luxurious designs while maintaining its safety-first identity. The Volvo S70, V70, and XC90 SUV helped establish the brand globally, especially in North America and Europe.
In 1999, Volvo Cars was sold by AB Volvo to Ford Motor Company, where it operated under the Premier Automotive Group alongside brands like Jaguar and Aston Martin.
2010–Present: Electrification and Reinvention
A major turning point came in 2010, when Chinese automotive giant Geely Holding Group acquired Volvo Cars from Ford. Under new ownership, the brand entered a period of rapid innovation, redefining itself as a pioneer in electrification, connectivity, and sustainability.
Major accomplishments in the 2010s and 2020s include:
- Launch of the Scalable Product Architecture (SPA) platform
- Introduction of award-winning models like the XC40, S90, and V90
- A bold commitment in 2017 to electrify every new Volvo model starting in 2019
- Pioneering developments in autonomous driving and safety tech
2024: A Record-Breaking Year
In 2024, Volvo Cars recorded a historic year, achieving:
- SEK 27 billion in core operating profit
- SEK 400.2 billion in revenue
- A global sales record of 763,389 cars
These figures demonstrate that Volvo is not only preserving its heritage but also thriving in the age of electric and sustainable mobility.
Looking Ahead: A Future Built on Legacy
As Volvo Cars gears up for its fully electric future, it stays rooted in the core principles that have defined it for nearly 100 years: safety, sustainability, and innovation.
Through strategic partnerships — such as the groundbreaking supply agreement with SSAB for near-zero emissions recycled steel — Volvo continues to set the pace for the global automotive industry’s transition to climate-neutral transportation.
“For Life. To give people the freedom to move in a personal, sustainable and safe way.”
— Volvo Cars’ Purpose Statement
Final Thoughts: Steel Innovation Driving Change
This collaboration with SSAB is just the beginning. As the global steel industry continues its green transition, partnerships like these will play a critical role in decarbonizing transportation and shaping a more sustainable future.
Volvo Cars is not only producing electric vehicles — it’s redefining how those vehicles are made.
🇲🇾 Lux Metal: Advancing Precision Metalwork in Southeast Asia
As Europe pushes toward green steel, Lux Metal proudly echoes this commitment in Malaysia. Based in a region rapidly industrializing, Lux Metal specializes in custom stainless steel and mild steel fabrication, offering high-precision solutions across industries.
Our core services include:
- Laser Cutting
- Sheet Metal Bending & Rolling
- Milling and Turning
- CNC Machining
- Welding and Assembly
- Custom Steel Projects for DIY and Industrial Applications
With a robust lineup of modern CNC equipment, advanced fabrication techniques, and a skilled engineering team, Lux Metal delivers quality, precision, and durability — while embracing the principles of resource efficiency and responsible production.
👉 Explore our solutions at: www.luxmetalgroup.com
🔗 Reference Links
- Salzgitter & Volvo Cars Create Closed-Loop Steel Partnership:
https://metallurgprom.org/en/news/europe/17107-salzgitter-i-volvo-cars-sozdajut-zamknutoe-partnerstvo.html - Volvo Cars Signs Contract for SSAB Zero Steel:
https://metallurgprom.org/en/news/europe/17046-volvo-cars-podpisyvaet-kontrakt-na-postavku-ssab-zero-steel.html - SSAB Official Announcement – SSAB Zero Supply Agreement:
https://www.ssab.com/en/news/2025/06/ssab-and-volvo-cars-sign-ssab-zero-supply-agreement-for-serial-production - Volvo Cars – How Recycled Steel from SSAB Helps Cut CO₂ Emissions:
https://www.volvocars.com/my/news/articles/how-recycled-steel-from-ssab-helps-us-unlock-co2-emission-cuts/ - Volvo Cars Official Press Release:
https://www.media.volvocars.com/global/en-gb/media/pressreleases/349864/volvo-cars-signs-recycled-steel-deal-with-ssab