ArcelorMittal and Gestamp sign steel-recycling agreement for automotive supply chain
ArcelorMittal Europe - Flat Products and automotive supplier Gestamp have agreed to develop a joint steel-recycling scheme intended to improve environmental sustainability across their supply chain and pass the benefits on to automakers. Gestamp announced the circularity agreement on July 21, 2023.
Mariam Al Mansoori
Securing scrap and lower-emissions steel supplies
The companies will jointly design and implement the scheme to improve steel recycling between their businesses. They describe reliable access to scrap as an important part of decarbonizing steel production and say cooperation among supply-chain partners is the best way to secure it.
According to the announcement, the agreement provides a supply guarantee for automakers choosing reduced-CO2 steel. The companies say that continuity will allow customers to maintain the CO2 performance they establish for their vehicles through the end of production.
Gescrap also participates in the agreement, according to Gestamp's first-half results release of July 25, 2023, which names all three businesses as parties. Gestamp acquired a strategic stake in the metal-recycling subsidiary in 2022. It describes Gescrap as a multinational industrial metal-recycling and total-waste-management group, and as a European leader in managing high-quality scrap.
High-quality scrap is scarce, but securing it supports greater use of lower-emissions steel in automotive components. Gestamp says incorporating scrap collection, sorting and reuse into its production chain enables complete life-cycle traceability.
From steel certificates to component trials
The agreement follows earlier steps by the two companies to introduce lower-emissions steel into automotive manufacturing. In 2021, Gestamp announced that it had become the first Tier 1 automotive supplier to purchase ArcelorMittal's XCarb green steel certificates for component production.
ArcelorMittal's Flat Products business made its first deliveries of XCarb recycled and renewably produced steel in March 2022. The electric arc furnace process uses at least 75% scrap steel and renewable electricity for all of the steelmaking process's electricity needs. The resulting CO2 footprint is nearly 70% below that of the same product made without the XCarb recycled and renewably produced substrate.
In July 2022, the companies successfully tested high-scrap-content, low-carbon-emissions steel for parts intended for vehicles to be produced in Spain and elsewhere in Europe. Gestamp made trial components, including a car's tunnel and seat reinforcements, from Usibor 1500 using XCarb recycled and renewably produced substrate. These were press-hardenable, ultra-high-strength steel parts.
At the time, the trial was the first publicly announced collaboration of its kind, opening the way to broader automotive use of low-carbon-emissions steel. It was a trial, rather than a general rollout across vehicle production.
Gestamp's broader recycling plans
Gestamp has outlined its recycled-steel-focused circular-economy roadmap since December 2022. It presented the roadmap at its Capital Markets Day in June 2023, identifying a long-term goal of contributing to the "Net Zero Car." The company's circularity disclosures also say that more than 98% of its waste is recycled, reused or recovered instead of going to landfill.
A separate partnership signed with Tata Steel UK on October 10, 2023, aimed to nearly double the recycled steel content in automotive components. That agreement sought to increase the recycled content associated with steel supplied to Gestamp from Tata Steel's existing 17% to 30%, without affecting quality, strength or formability.
