BMW aims to have 7m e-cars on the road in 10 years © Sjoerd van der Wal/Getty Images
BMW aims to have 7m e-cars on the road in 10 years © Sjoerd van der Wal/Getty Images

Supplier's CO2 emissions will be part of tender process, says BMW

29 July 2020

BMW has announced a supplier’s carbon footprint will be a key factor in tendering decisions under a wide-ranging sustainability initiative.

The carmaker said it is aiming for carbon emissions from production and sites to be lowered by 80% per vehicle and it believed its changes would give it the most sustainable supply chain in the auto industry.

Oliver Zipse, chairman of the board of management at BMW, said a key part of the company’s strategy was the development of electric vehicles.

“The main lever here is a far-reaching product strategy with massive expansion of e-mobility: in ten years, the goal is to have... more than seven million electrified BMW Group vehicles on the roads,” he said.

However BMW said it recognised because of the energy-intensiveness of the production of high-voltage batteries it would be impossible to achieve the CO2 emissions targets without supply chain action.

As a result the company said it would define a supplier’s carbon footprint as a decision criterion in its contract award processes.

It believes this would make it the first automobile manufacturer to establish concrete CO2 targets for its supply chain, which consists of around 12,000 tier one suppliers and a spend of more than €60bn per year.

“As a leader in sustainability, what we say counts a great deal with our suppliers – so we leverage our reputation in this respect,” said Zipse. “Our aim is to ensure the most sustainable supply chain in the entire industry.”

The company said it had already agreed with cell manufacturers that they will only use green power to produce fifth-generation battery cells – saving 10m tonnes of CO2 over the next 10 years.

“The company will... in the coming years, work with its component and raw material suppliers to do the same throughout the entire supply chain,” said Zipse.

Without corrective measures throughout the supply chain, the higher proportion of electrified vehicles would mean CO2 emissions per vehicle from the BMW Group supply chain would increase by more than a third by 2030.

Zipse said the board of management and management executives would measure their own performance against the sustainability goals.

“We are not just making abstract statements – we have developed a detailed ten-year plan with annual interim goals for the timeframe up to 2030,” he said.

“The compensation of our board of management and executive management will also be tied to this.”

He said the company aimed to reduce CO2 emissions per vehicle by at least one third across the entire spectrum.

“For a fleet of around 2.5m vehicles, as produced by the BMW Group in 2019, this would correspond to a reduction of more than 40m tonnes of CO2 over the lifecycle in 2030,” BMW added.

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