Commercial, GHG Emissions  -  December 9, 2020

Mercedes-Benz aims for carbon neutral supply chain by 2039

Mercedes-Benz announced this week its ambition to have a carbon-neutral global supply chain by 2039.

This new program, dubbed “Ambition 2039,” will require a shift to a completely electrified power supply for production in addition to an all-electric car fleet. The automaker says that the production of an all-electric vehicle is twice as CO2 intensive as a conventional combustion engine, making it crucial that emissions are taken out of the upstream value chain in order to have a truly carbon neutral product.

In the interim, the company aims to have plug-in hybrids or all-electric vehicles make up more than half of its car sales by 2030. By 2022, all Mercedes-Benz-owned plants will be carbon neutral in production.

Within its supplier network, the company intends to focus on materials and components that are particularly carbon-intensive in manufacturing and processing to start, such as battery cells, steel and aluminum. These things account for about 80% of CO2 emissions in the supply chain of a fully electric vehicle.

“Electric mobility and sustainability go hand in hand for Mercedes-Benz,” Markus Schäfer, member of the Board of Management of Daimler AG and Mercedes-Benz AG, said in a statement. “With the electric EQS luxury sedan, which is already in the starting blocks for next year, we have already achieved important milestones in close cooperation with our partners - for example by purchasing CO2 neutrally produced battery cells. We are consequently pursuing this path: When awarding contracts for our subsequent electric vehicle platform - Mercedes-Benz Modular Architecture (MMA) for compact and medium-sized cars - we are already applying CO2 as a key criterion for the first time consistently.”

Almost half of Mercedes-Benz’s 2,000 suppliers have already signed an “Ambition Letter of Intent” committing to supplying the automaker with only carbon-neutral parts going forward. These companies account for more than half of the annual purchasing volume of Mercedes-Benz AG and the company plans to work closely with all of its other suppliers to jointly develop strategies for CO2 reduction. Those suppliers not willing to sign the Ambition letter will not be considered for new supply contracts, to incentivize the commitment to providing carbon-neutral products.

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