Mercedes-Benz stock gains as Hydro deal sharpens climate path

Mercedes-Benz announced on Tuesday, November 10, that it had revised its Ambition 2039 pathway and signed a binding long-term aluminium offtake agreement with Norway's Hydro. Reuters reported that the update followed slower-than-expected electric-vehicle adoption, while Mercedes-Benz said the measures are intended to connect decarbonisation with competitiveness and supply-chain resilience.

Mercedes-Benz stock traded at 40.84 euros on Lang & Schwarz at 11:54 CET on Friday, November 13, 0.34 percent above the Xetra close of Thursday, November 12. The reference Xetra close was 40.70 euros. The quote keeps the stock close to the 41-euro area after the sustainability announcements generated several sessions of investor attention.

Targets become more measurable

The company now targets a 90 percent reduction in emissions from its own production, an 80 percent cut in vehicle use-phase emissions where market conditions allow, and a 70 percent reduction across relevant value-chain stages by 2039, each measured against 2019. Mercedes-Benz intends to reach net zero by 2049 at the latest, with remaining emissions below 10 percent permanently neutralised.

The revised framework is more operational than a broad carbon-neutrality ambition. Mercedes-Benz said it will focus its sustainable business strategy from 2027 on decarbonisation, circularity, safety and people. The company also plans to increase the use of secondary raw materials to 40 percent within the next decade.

Hydro deal supports materials strategy

The Hydro agreement covers at least 10 percent of Mercedes-Benz's primary aluminium demand. The contract runs from 2026 beyond 2030 and requires a step-by-step reduction in the supplied aluminium's carbon footprint to 3.5 kilograms of CO2 equivalent per kilogram by 2028 and 3.0 kilograms from 2030.

Mercedes-Benz said the aluminium it currently sources from Hydro has a footprint of about 4.0 kilograms of CO2 equivalent per kilogram, compared with a global average of 14.4 kilograms. The agreement also includes Hydro CIRCAL, which contains at least 75 percent post-consumer recycled content and is planned for use from 2027.

The company joined the Aluminium Sector of the First Movers Coalition and plans to source at least 10 percent of its annual primary aluminium demand under the coalition's criteria by 2030. For investors, the agreement offers a clearer purchasing commitment, but execution will depend on the availability, cost and industrial scaling of lower-carbon materials.

What investors watch next

The strategy adds long-term milestones to Mercedes-Benz's broader vehicle electrification and procurement plans. Management is also linking renewable energy, circular materials and supply security to production competitiveness, rather than treating sustainability as a separate programme. That framing may matter as the group balances premium positioning with volatile raw-material and vehicle markets.

In the wider German market, investors can follow the DAX alongside automobile shares.

Further developments are available in more news and analyses on Mercedes-Benz stock.

Sources: Reuters and Mercedes-Benz Group.