What prompted Hyundai Motor to end its aluminium deal with Adaro Minerals?

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Hyundai Motor Ends Aluminium Deal with Adaro Minerals Amid Climate Campaign

Hyundai Motor has terminated its non-binding memorandum of understanding (MoU) with PT Adaro Minerals Indonesia Tbk, a subsidiary of Adaro Energy Indonesia, at the close of 2023. This decision followed a campaign by climate activists, supported by K-pop fans, urging the automaker to cease procuring aluminium produced using coal power. Both companies have agreed to pursue independent opportunities moving forward.
Climate Activist Pressure Influenced Decision

The termination of the aluminium supply agreement was directly influenced by a campaign spearheaded by the climate activist group Kpop4Planet. This group mobilised K-pop fans to advocate against Hyundai Motor's procurement of aluminium from Adaro, citing concerns over the energy source used in its production. Kpop4Planet publicly welcomed the carmaker's decision, framing it as a success for fans committed to addressing the climate crisis.
Agreement Details and Carbon Neutrality Concerns

Hyundai Motor had initially entered into the MoU with Adaro Minerals in 2022 with the intention of securing aluminium for its operations. At the time of signing, Hyundai had expressed expectations that the aluminium sourced from Adaro's subsidiary, PT Kalimantan Aluminium Industry, would align with the automaker's carbon neutrality objectives. The growing demand for aluminium among global car manufacturers was a key factor driving this agreement.
Environmental Impact of Aluminium Smelting

The production of aluminium is an energy-intensive process, and the use of coal as an energy source results in significant carbon emissions. This environmental consideration was central to the concerns raised by climate activists. Adaro Minerals has indicated plans to power the third phase of its aluminium smelter project with a hydropower plant currently under construction by its group, suggesting a future shift towards more sustainable energy sources.

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What prompted Hyundai Motor to end its aluminium deal with Adaro Minerals?

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