# Get inspired: Scania

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### Action Plan and Target Setting

Scania was the first heavy vehicle manufacturer to set science-based targets. Via the SBTi framework, the company has committed to a 50% emissions reduction from its operations (Scope 1 and 2) and a 20% reduction from its product end-uses (Scope 3) by 2025, using a 2015 baseline. Looking to the long term, Scania is committed to achieving net zero before 2050 in line with the standards set by SBTi.Electrification is the main strategy for decarbonization. By 2030, Scania is aiming for 50% electric sales. As electrification expands and emissions from fossil fuel vehicles decrease, materials such as steel and batteries will represent an increasingly bigger portion of Scania’s emissions footprint. This shift amplifies the need to tackle upstream emissions and deepen supplier engagement to achieve their targets and be a driving force for sustainable transportation.In alignment with this focus on upstream emissions, Scania has together with its suppliers outlined an ambitious strategy for decarbonizing its supply chain by 2030. The strategy is centered around Scania’s key emissions hotspots: batteries, aluminum, steel, and cast iron, which collectively account for about 80% of Scania’s emissions from production materials. By 2030, Scania targets 100% green batteries, aluminum, steel, and cast iron in their European production [1]. This is the first step towards an even broader ambition encompassing Scania’s global supply chain. The strategy is effective in the company’s sourcing processes since September 2023, thus placing mandatory green purchasing requirements on suppliers in any of the four hotspot areas.  [1] Scania’s definition of “green” in this context implies eliminating the main sources of emissions by utilizing new technologies, green electricity and/or recycled material. In batteries, for example, access to green energy in production is decisive. In the production of flat steel, replacing coal with green hydrogen is key.


### Supplier Engagement

Emphasizing a proactive approach in relationships with suppliers and collaboration in sector-wide initiatives, Scania’s approach to supplier engagement is foundational for future preparedness in the green transition. Proactive engagement ensures Scania’s access to low-carbon materials, while sector involvement not only drives robust demand but also promotes best practice sharing; as peers in the automotive sector move along similar trajectories and other industries follow the same roadmap, knowledge sharing becomes an important asset in the decarbonization journey.Batteries and steel are the two main CO2e emissions hotspots of Scania’s supply chain. To realize their Scope 3 reduction targets and supply chain decarbonization ambition, Scania has partnered with the green battery manufacturer Northvolt, sharing an ambition to develop and commercialize a top-performance battery cell enabling Scania’s plans for electrifying heavy transport. In early 2023, the collaboration came to fruition as Scania and Northvolt unveiled a green battery capable of powering trucks for 1.5 million kilometers – equivalent to the truck’s whole lifetime. The battery is produced with fossil-free electricity in northern Sweden with a carbon footprint of one-third of that of a comparative industry reference.Scania has moreover developed a green steel roadmap for 2030 in direct dialogue with their suppliers so that they are aware of their role and Scania’s expectations on the needed ramp-up of green steel production. During 2023 Scania secured two landmark strategic agreements with steelmakers for the company’s supply of green steel. In June, Scania placed its first order of green steel from H2 Green Steel. Mid-November, a joint target was announced with SSAB to decarbonise all current steel deliveries by 2030. Green steel supplies for Scania’s European production are targeted to start in 2026.Additionally, as a founding member of the First Movers’ Coalition, which encourages companies to increase low-carbon purchases in areas hard to decarbonize, Scania amplifies its commitment to low-carbon sourcing, with the H2 Green Steel contract contributing to growing the demand for green steel.Decarbonizing the supply chain of heavy vehicle manufacturing will be challenging, but it is Scania’s firm belief that it is possible. The key to success is a close collaboration with suppliers, with clear demand signals and detailed plans for transition. Scania is willing to do the work.