Motor industry urged to unite to drive climate action

Car manufacturers hold the key to putting the world on the right road to achieving the world’s global warming aspirations, despite some still not convinced a move to electric vehicles is the future.

Electric Vehicle manufacturers, Polestar and Rivian have collaborated on a ‘Pathway Report’ which concludes that the automotive industry is set to overshoot the IPCC’s 1.5-degree pathway by at least 75% by 2050.

The report, which uses existing, open-source data to model the current trajectory for emissions stemming from the car industry, was carried out by global management consulting firm Kearney.

Passenger vehicles currently account for 15% of all greenhouse gas (GHG) emissions globally. The IPCC has stated that all GHG emissions need to be reduced by 43% by 2030 and the report makes clear that the automotive industry is far off track, and, alarmingly, will have spent its full CO2e budget already by 2035 without urgent action.

Despite the gloomy outlook, the report suggests that the car industry still has a chance to get on track. By redirecting resources and focus, the industry can rapidly build the momentum required to remain in line with the Paris Agreement. The Pathway Report focuses on the current decade and outlines immediate, clear actions that car manufacturers can take between now and 2030, including some that can be triggered immediately.

The data presents a pathway based around three key levers. Lever 1 looks at the speed at which fossil fuel-powered cars need to be replaced by electric cars but points out that this alone will not be enough. A lot more work will be required for levers 2 and 3:

> Increasing renewable energy in power grids

> Reducing greenhouse gas emissions in the manufacturing supply chain

“Pulling just one or two levers in isolation will be insufficient and only reduce the overshoot,” it warns. “Collective action from automakers is needed on all three levers, in parallel, at a global level.

“Firstly, the industry must accelerate the transition to electric vehicles by investing in manufacturing capabilities, as well as implementing a firm end date for fossil fuel car sales globally. Secondly, build out renewable energy supply to global grids that enable EV’s to reach their full potential through green charging. Thirdly, decarbonise the manufacturing supply chains for these vehicles through switching to low carbon materials, and investing in renewable energy solutions for supply chains.”

Fredrika Klarén, (pic) Polestar head of sustainability, says: “Car companies may be on different paths when it comes to brand, design, and business strategies, and some won’t even admit that the road to the future is electric. I believe it is, and that the climate crisis is a shared responsibility, and we must look beyond tailpipe emissions. This report makes clear the importance of acting now and together. There’s a clear cost to inaction, but there’s also a financial opportunity for innovators who find new answers to the challenges we face.”

The report has been shared with several of the world’s leading car makers, with the aim to find a path towards “unprecedented, relevant and collective” climate action for the car industry.

Anisa Costa, Rivian’s chief sustainability officer, added: “The report’s findings are sobering. Our hope is that this report lays the groundwork for the automotive industry to collaborate in driving progress at the pace and scale we need – and ideally inspiring other industries to do the same. Together, I’m confident we can win the race against time.”

Polestar added the Pathway Report clearly showed the cost of inaction and the strong case for sustainable development.

“The investment community is moving and capital flows are shifting from traditional investment to sustainable investment, recognising an increasing link between sustainable transformation and financial benefits. In 2021, global sustainability investments totalled $35.3 trillion, representing over a third of all assets in five of the world’s biggest markets,” it added.

Angela Hultberg, global sustainability director at Kearney, concluded: “The result of our modelling clearly shows that the industry needs to accelerate the pace of becoming a low carbon industry. We looked at different scenarios, different data points, and the conclusion is that no matter how you model it, we are far too close for comfort.

“We sincerely hope this report will be a starting point for the industry to focus on areas where there is agreement and find specific initiatives. It will take collective action to solve some of the issues at hand, and we look forward to seeing what the manufacturers will do in the near future.”

Despite the gloomy outlook, the report suggests that the car industry still has a chance to get on track. By redirecting resources and focus, the industry can rapidly build the momentum required to remain in line with the Paris Agreement.

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