Pricing the future: A new approach to carbon steel pricing models addressing grey vs. green steel on the example of voestalpine

Abstract

This thesis is aiming to provide insights on pricing models applicable in the steel industry. These pricing models are expected to be influenced by sustainability regulations of the EU as the green transition of steel is slowly progressing. The theoretical approach focuses on value-based (VBP), cost-based (CBP) and market-based pricing (MBP) models, the regulations that effect the steel industry regarding decarbonization and the organizational structure that companies should follow to successfully implement pricing strategies and pricing models. A research gap has been identified regarding the application of pricing models in the context of the steel industry. This thesis uses expert interviews to collect empirical data from the steel industry. The interviews were conducted with experts within voestalpine and its customers. The results from the interviews were analyzed following a qualitive content analyses according to Kuckartz. The analysis shows that pricing in the steel industry utilizes manly VBP, CBP and MBP. All three models have certain situations where one or the other stands out most. Furthermore the results show, that VBP seems to be the most suitable model to price green steel in the future, while at the same time it is the most complex model to master for steel manufacturers. While this is supported by the experts interviewed, they also stated that CBP and MBP are also applicable depending on the situation of the cyclic steel market. Also, the results show that pricing models can be seen as a good basis for pricing, while a certain flexibility is needed to provide the right price to the customer. Findings show, that when companies want to implement or adapt pricing models, it is important to install a pricing governance, which means that the company needs a solid pricing management and a culture that is prone to pricing, where every employee understands the importance of pricing models and the strategy behind them. Due to the absence of a definition for green steel, transparency is seen as a main factor for a successful pricing model. The present and upcoming regulations such as ETS and CBAM oppose additional challenges to the industry. While they were supposed to help the European economy, with decarbonization and staying competitive at the same time, they are seen critical by the experts. Still they agreed that regulations are a key factor to foster decarbonization and the development of a green market in the steel industry.

Datum der Bewilligung	2025
Originalsprache	Englisch
Betreuer/-in	Peter Hutterer (Betreuer*in)