70 Are there any specific examples of related counter measures taken by Schaeffler In an initial appreciable step in the area of mate rial purchasing we recently agreed a collabora tive partnership with Swedish green steel startup H2GS including the delivery of 100 000 metric tons 110 000 short tons of green steel starting in 2025 But since that doesn t cover our requirement we re also going to pursue a consistent path toward car bon neutral steel with other suppliers as well Plus the decarbonization of steel is only the first step to be followed by plastics and alumuminum What effect does hydrogen have on global supply chains On the one hand it can be used as propulsion en ergy for hauling goods Logistics accounts for five to seven percent of the global carbon footprint and counting Here hydrogen can help reduce emis sions especially in medium and long haul trans portation On the other hand the structual changes that will be required to adapt supply chains to a hy drogen economy should not be underestimated What exactly do you mean by that We need to not only address the production trans portation and utilization of hydrogen which Schaeffler is doing in the areas of hydrogen fuel cell technology as well as with the development of LOHC in other words liquid organic hydrogen carriers but also the question of whether trans portation of hydrogen even makes sense In some cases it will but definitely not across the board There will also be production processes for which local use of hydrogen will make more sense Again let s take steel for example In the old days the steel industry established its mills at locations providing the coal for iron ore reduction In Ger many that was the Ruhr region Going forward the steel industry or at least some of it will be lo cated where green hydrogen can be produced or at least will be easily available In such consider ations it may definitely make sense to think about splitting up integrated steel mills In that case the iron ore reduction process would take place close to the hydrogen source and the steel production process closer to the user It will be necessary to adapt various supply chains to the production sce narios that will have to be reorganized in the wake of a hydrogen economy Let s turn from hydrogen to the perennial tech nology theme of digitalization How can that help make supply chains more efficient and sustain able Digitalization can be of particular help in making the complex flow of goods systems more transpar ent How Well we all know Google Maps and use it when we travel on the road Because all vehicles and their occupants constantly supply data in real time Google Maps is the perfect digital twin of re al world traffic situations As a result we re always able to see if there are any traffic problems on our route and when we re going to arrive at our destina tion Such a holistic digital twin in which the data of all the players involved are merged and analyzed is lacking in relation to the flow of goods It would be of huge help for synchronizing the complex systems suppliers were recognized for outstanding collaboration performance at this year s Schaeffler Supplier Day Andreas Schick said Our suppliers provide major leverage in the bid to reduce greenhouse gases We are having to rethink materials and reconfigure the processes used to produce them We expect our suppliers to follow suit By working together in this way we will succeed in achieving climate neutrality by 2040 17

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