I have been thinking recently about the automotive sector, and its interesting position in the face of burgeoning pressure from customers and regulators to clean up its act. It is clear that new product development is the main sustainability-related priority, especially electric vehicles (EVs). An ex-colleague of mine is heavily involved in the EV space in Sydney, and when we last caught up I was blown away by how exciting all the developments were. But what about other than EVs? This article looks at what those are based on what the sector is communicating in the sustainability media.
For my amusement, I took an educated guess at what those material issues might be. In addition to carbon emissions and other polluting chemicals and emissions to air and potentially water and land, my guess as to the other material issues were sustainable procurement, conflict minerals, and probably circular economy (i.e. waste management).
This one was almost immediately validated. Recently, in October, Volvo (owned by Geely Holdings) was reported for it plans to be “climate neutral” by 2040. But the Reuters article also mentioned existing commitments from Daimler (carbon neutral fleet by 2039), and Volkswagen (carbon neutral by 2050).
In elaborating on Volvo’s plans, the report mentioned a focus on manufacturing and logistics, including recycled plastic as part of its carbon reduction strategy.
Plastic, of course!
Plastic was not in my introduction’s list, but it is unsurprising given the wonderful “war against plastic” that seems to be happening in the sustainability industry. Not to mention that plastic would play a major role in the manufacturing process; I have seen plastic in a lot of cars.
Sustainable Procurement and Carbon in the Supply Chain
Volvo’s announcement also had a strategy for carbon in the supply chain; that “it aims for its global manufacturing network to be fully climate neutral by 2025”. This means that the suppliers of auto parts and other components of the automotive supply chain need to prioritise reducing the carbon intensity of its products. I love how things like this create a snowball effect up the supply chain.
In August, Cooper Tyre & Rubber was featured in Environmental Leader as making drastic improvements in just that – reducing its carbon emissions as a business up the automotive supply chain. The article mentioned LED lighting upgrades and combined heat and power as two examples of projects under this objective.
Moreover, it was looking at its own product’s contribution to an automobile’s footprint: “Cooper is investing in product optimization to boost fuel efficiency and use fewer raw materials. By improving product weight, construction and materials to maximize performance, Cooper is improving rolling resistance which lowers vehicle fuel consumption and improves efficiency.” In June, Michelin was profiled in GreenBiz for something similar, the development of a prototype airless tyre.
Aside from its carbon footprint, the Cooper article was actually headlined by its efforts in waste management, where it had diverted 78 percent of its waste from landfill to recycling, in its manufacturing processes. That’s impressive.
A competitor to Cooper, Bridgestone, was promoted in Environmental Leader in July for meeting its water reduction target two years early. This is apparently important to Bridgestone because it has factories in water stressed areas of China and Mexico. Despite this, I was left wondering if water is a material issue for the entire auto industry.
What about chemicals and conflict minerals?
It is not surprising that these topics remain absent from the sustainability industry media, which is about promoting progress and innovation, to stand out. Chemicals and conflict minerals are more regulatory/compliance type priorities, so if they were to appear in the media it would probably be about something bad!
Carbon, plastic, waste, sustainable procurement/supply chain – all priorities. Water – maybe. Chemicals and conflict minerals – would have to be. Turns out I guessed quite well!