KGM has signed an MOU with carbon management specialist Hushi Partners to prepare for the European Union's Carbon Border Adjustment Mechanism. The automaker will build a system to calculate emissions by part and collect supply chain data from steel and aluminum suppliers used in vehicles exported to Europe. CBAM currently applies to six product categories including steel and aluminum. Cars are not covered yet, but the European Commission has proposed adding auto parts that rely heavily on those materials starting in 2028. Under CBAM, importers must buy certificates equal to embedded emissions, and if actual data is missing, EU default values apply with a surcharge rising from 10% in 2026 to 30% after 2028. KGM says the agreement is the first step toward a regulatory response framework. Since July, it has worked with Hushi to calculate product-specific embedded emissions under EU rules, covering material inputs, process energy, and certificates of origin from major partners. The plan is to expand the system across the supply chain to protect export competitiveness.
