Ford sets out action on supply chain sustainability

Motor industry giant Ford has set out the steps it is taking to reduce the carbon footprint of its supply chain in its “2009/10 Blueprint for Sustainability: The Future at Work”.

It said it was making progress in understanding and reducing the climate footprint. “We reduced 2009 operational CO2 emissions by nine per cent globally compared to 2008 and earned our fifth consecutive Energy Star Award for Sustained Excellence from the US Environmental Protection Agency.

“In addition, we announced our participation in the Carbon Disclosure Project’s Supply Chain Initiative and the World Resources Institute/ World Business Council for Sustainable Development’s Scope 3 road testing projects – both as a way to better understand greenhouse gas emissions in our supply chain, the report said, pointing out that it is the only motor manufacturer participating in these two initiatives.

In logistics, the report highlighted a number of achievements in 2009-10:

* Reduced the road-based freight of parts and finished vehicles by increasing the use of rail and sea transport. (Ford reckons switching from road to rail can save 40 per cent of CO2 emissions.)

* Reduced inland road-based transport within Spain by 29 per cent by expanding from three sea ports of entry to six.

* Introduced a barge route between Romania and Bavaria and began using the Black Sea for imports into Russia.

* In North America, at the beginning of 2010, rail and intermodal rail shipments represented almost 40 per cent of the network distance travelled, while accounting for less than 15 per cent of the network carbon footprint. In North America, achieved an average of eight per cent fewer miles travelled by delivery trucks than at the end of 2009, and the network uses 70 per cent rail miles and 30 per cent road miles.

* Increased the use of alternative fuels and fuel-efficient driving practices on delivery vehicles.

* Implemented new packaging guidelines that require supplier-provided packaging to support corporate sustainability goals by seeking a neutral or positive environmental footprint through zero waste to landfill and the use of 100 per cent recycled, renewable, or recyclable materials.

* Increased the use of reusable packaging containers to 90 per cent in our European operations.

In May Ford set out plans to survey its 35 top global suppliers on their energy use and estimated greenhouse gas emissions. The 35 suppliers represent close to 30 per cent of Ford’s $65 billion in annual procurement spending.

“Suppliers play an important role as we look to reduce our overall carbon footprint and drive more efficiency in an energy constrained world,” said Tony Brown, Ford group vice president, Global Purchasing. “This initiative builds on our leadership in collaborating with suppliers and gives them a way to participate in solving an issue that faces our entire industry.”

The suppliers in the initial request include companies that make commodities such as seats, steering systems, tires and metal components, which require more energy to produce and thus have a larger carbon footprint. While many of these suppliers already measure their greenhouse gas emissions, the project would facilitate collaboration and sharing of processes and practices that can drive significant emissions reductions and help meet future regulatory requirements.

The data gathered from suppliers will be evaluated using modelling software from PTC InSight. Preliminary work Ford has done with PTC has indicated there are opportunities for both Ford and suppliers to reduce carbon emissions. Any reductions by suppliers would be in addition to Ford’s own goal of reducing greenhouse gases 30 per cent by 2020 from the company’s 2006 model year baseline.

It said that several of its top suppliers were already working to better understand their carbon emissions, including DuPont, TRW Automotive Holdings Corp., Bosch and Johnson Controls.

Johnson Controls, which supplies seats, interiors, electronics and batteries to Ford, is also working with the Carbon Disclosure Project and has goals in place to reduce greenhouse gas emissions.