A recent analysis by Transport & Environment (T&E) and consultancy Ricardo highlights the potential for reducing CO2 emissions in European car manufacturing by switching to steel produced with green hydrogen and electric arc furnaces or recycled from scrap. By 2030, this shift could cut emissions by 6.9 million tonnes, equivalent to the annual emissions of 3.5 million fossil fuel cars. The study indicates that adopting 40% green steel in vehicle production by 2030 would only add €57 to the cost of an electric vehicle. The shift to green steel is crucial as the automotive sector aims for net-zero emissions by 2050. While green hydrogen production presents an environmentally friendly option, significant investment is needed to establish low-carbon steel production, which relies on a reliable market for offtake. T&E urges lawmakers to set targets for increasing the use of green steel in new vehicles from 2030 onwards. The production tracking by Ricardo suggests that Europe could produce up to 172 million tonnes of low-carbon steel annually by 2030, enough to meet the automotive sector's steel demand. The recommendations include having 40% of steel in new cars as green by 2030, with a progressive increase to 75% by 2035 and 100% by 2040. Carmakers are encouraged to distribute initial costs through premium models. The automotive sector, being a significant consumer of steel, is in a prime position to lead the market for green steel in Europe. The shift to lightweighting is also likely to reduce steel usage in car manufacturing over the coming decade, further supporting the transition to low-carbon steel production.