The Swedish carmaker, owned by China's Geely Holding, will be the first car maker to source steel from green steel venture HYBRIT, which is owned by SSAB, Swedish state-owned utility Vattenfall and Swedish miner LKAB.

"This steel will be used for testing purposes and may be used in a concept car," SSAB said in a statement.

The HYBRIT project last year began test operations in Sweden to replace coking coal, traditionally needed for ore-based steel making, with fossil-free electricity and hydrogen, which in turn is produced using only renewable power. It aims for a demonstration plant to be ready in 2026. [L8N2FX3LV]

"Together with Volvo Cars, we aim to developfossil-free steel products for cars of the future," SSAB said, adding that Volvo Cars aimed to be the first carmaker to use fossil-free steel for its own actual car production.

(Reporting by Anna Ringstrom; editing by Niklas Pollard)