Setting Decarbonisation Targets in the Automotive Manufacturing Industry

In the pursuit of a more sustainable future and to meet OEM requirements, South African automotive manufacturing companies are increasingly under pressure to set ambitious sustainability targets. But how does one go about this? Our sustainability team has delved into the intricacies of establishing sustainability goals within the automotive sector, examining key considerations and methodologies employed by leading companies like Volkswagen and Toyota.

  1. Understand the Framework

The first step in setting sustainability targets is to determine the framework that best aligns with your firm’s objectives. For instance, Volkswagen employs the GHG protocol, while Toyota follows the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). Identifying the appropriate framework provides a structured approach to measuring and reporting emissions.

  1. Define Emission Boundaries

Next, it’s crucial to define the emission boundaries. This involves deciding which scopes are included in your assessment. Are you focusing on scope 1, 2, and/or 3 emissions? Additionally, consider whether you’re adopting a cradle-to-grave approach, encompassing both upstream and downstream decarbonisation, or a cradle-to-gate approach, which focuses on emissions from the start to your factory. Clarity on these boundaries ensures comprehensive coverage and accountability.

  1. Data Collection Challenges

Collecting accurate data is paramount but can pose significant challenges, especially when it comes to scope 3 emissions. Partnering with specialised services can streamline the process and ensure data integrity. Here’s a breakdown of key data points to consider:

  • Firm Data: Number of employees, total production mass for the last full year.
  • Part Data: Details such as part number, description, net weight, and quantity supplied.
  • Scope 1 and 2: Stationary and mobile combustion data, including fuel usage, electricity usage and process emissions.
  • Scope 3: Factors such as purchased goods and services, capital goods, upstream transportation and distribution, waste generation, business travel, employee commuting, and leased assets.
  1. Measurable and Verifiable Targets

Sustainability targets must be both measurable and verifiable. For instance, your firm may aim to reduce carbon emissions by a certain percentage annually. Aligning with global standards like the SBTi, ensures credibility and helps combat greenwashing.

In conclusion, setting decarbonisation targets in the automotive manufacturing industry requires a strategic and systematic approach. By understanding the framework, defining emission boundaries, overcoming data collection challenges, and establishing measurable targets, companies can drive decarbonisation towards a more sustainable future.