Mercedes-Benz, Hydro expand partnership to strengthen low-carbon aluminium sourcing

• Mercedes-Benz expands low-carbon aluminium sourcing for future EVs
• Hydro partnership combines recycled and low-carbon primary aluminium
• Automakers deepen procurement of lower-carbon raw materials

Mercedes-Benz has expanded its partnership with Norwegian aluminium producer Hydro to increase the use of recycled and low-carbon aluminium across its next generation of electric vehicles, as automakers increasingly extend decarbonisation efforts beyond manufacturing operations to the materials used in vehicle production.

Under the agreement, Mercedes-Benz will become the first automotive manufacturer in Europe to integrate Hydro CIRCAL, a recycled aluminium product containing at least 75% recycled content, into serial production for its upcoming large EV models. The companies will also expand the use of Hydro REDUXA low-carbon primary aluminium, reflecting a broader shift in automotive procurement towards sourcing lower-carbon materials alongside maintaining resilient supply chains.

Partnership expands access to lower-carbon aluminium

The latest agreement broadens the companies’ collaboration across both recycled and primary aluminium. Alongside integrating Hydro CIRCAL into serial vehicle production, Mercedes-Benz will increase sourcing of Hydro REDUXA while both companies continue working to reduce the carbon footprint of primary aluminium.

The dual-material approach recognises that recycled aluminium alone cannot meet automotive demand, making lower-carbon primary aluminium an important complement as manufacturers seek to reduce emissions across the aluminium value chain without compromising quality, safety or performance.

Hydro CIRCAL is produced using post-consumer scrap recovered from end-of-life vehicles, buildings and infrastructure, supporting a more circular supply of aluminium for new vehicle production.

Material sourcing becomes a bigger focus for automakers

The expanded partnership comes as automakers increasingly target emissions embedded in raw materials alongside those generated during manufacturing and vehicle use. Aluminium has emerged as a strategic material because of its importance in lightweight vehicle design and its contribution to a vehicle’s embedded carbon footprint.

As manufacturers pursue Scope 3 emissions reductions, procurement decisions are increasingly influenced by the carbon intensity of materials alongside traditional considerations such as cost, quality and supply security. This is driving stronger collaboration between automakers and suppliers capable of providing certified recycled and lower-carbon materials.

The agreement also reflects a growing emphasis on regional and circular supply chains. Recovering aluminium from post-consumer scrap and processing it closer to manufacturing operations reduces reliance on virgin raw materials while strengthening supply-chain resilience. Mercedes-Benz said future automotive supply chains would increasingly be shaped by circularity, localisation and transparency as manufacturers seek to lower emissions across the value chain.

Collaboration evolves from roadmap to commercial sourcing

The latest agreement builds on a partnership established in 2022, when Mercedes-Benz and Hydro signed a letter of intent to develop a low-carbon aluminium technology roadmap through 2030. The collaboration was expanded in 2024 to encompass the entire aluminium value chain, while the companies also launched a joint initiative to strengthen human rights due diligence across their supply chain.

The progression from technology collaboration to larger-scale commercial sourcing reflects the increasing integration of lower-carbon materials into Mercedes-Benz’s production strategy.

Outlook

As automotive decarbonisation extends further upstream, procurement strategies are expected to place greater emphasis on verified recycled content and lower-carbon primary materials alongside cost, quality and supply security. This is likely to encourage more long-term partnerships between automakers and aluminium producers capable of supplying certified low-carbon products, while supporting increasingly regional and circular supply chains as manufacturers work to reduce emissions embedded across vehicle production.